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Simulating Income Distribution Changes in Bolivia: a Microeconometric Approach

Author

Listed:
  • Leonardo Gasparini
  • Mariana Marchionni

    (Centro de Estudios Distributivos, Laborales y Sociales (CEDLAS) FCE - UNLP
    Centro de Estudios Distributivos, Laborales y Sociales (CEDLAS) FCE - UNLP)

  • Federico Gutierrez

    (Centro de Estudios Distributivos, Laborales y Sociales (CEDLAS) FCE - UNLP)

Abstract

This paper uses microeconometric simulations to characterize the distributional changes occurred in the Bolivian economy in the period 1993-2002, and to assess the potential distributional impact of various alternative economic scenarios for the next decade. Wage equations for urban and rural areas estimated by both OLS and quantile regression are the main inputs for the microsimulations. A sizeable increase in the dispersion in worker unobserved wage determinants is the main factor behind the significant increase in household income inequality in the 90s. The results of the microsimulations suggest a small poverty-reducing effect of several potential scenarios, including education upgrading, sectoral transformations, labor informality reduction, gender and race wage gap closing, and changes in the structure of the returns to education. Sustainable and vigorous productivity growth seems to be a necessary condition for Bolivia to meet the poverty Millennium Development Goal by 2015.

Suggested Citation

  • Leonardo Gasparini & Mariana Marchionni & Federico Gutierrez, 2004. "Simulating Income Distribution Changes in Bolivia: a Microeconometric Approach," CEDLAS, Working Papers 0012, CEDLAS, Universidad Nacional de La Plata.
    • Handle: RePEc:dls:wpaper:0012
    as

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    File URL: http://cedlas.econo.unlp.edu.ar/archivos_upload/doc_cedlas12.pdf
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    References listed on IDEAS

    as
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    Full references (including those not matched with items on IDEAS)

    Citations

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    Cited by:

    1. Carlos Foronda Rojas, 2006. "Evaluación de los efectos de las políticas de exportación y de productividad en la distribución del ingreso a partir de microsimulaciones," Investigación & Desarrollo 0206, Universidad Privada Boliviana, revised Mar 2006.
    2. Monserrat Bustelo, 2004. "Caracterización de los Cambios en la Desigualdad y la Pobreza en Argentina Haciendo Uso de Técnicas de Descomposiciones Microeconometricas (1992-2001)," CEDLAS, Working Papers 0013, CEDLAS, Universidad Nacional de La Plata.
    3. Jing Dai & Stefan Sperlich & Walter Zucchini, 2016. "A Simple Method for Predicting Distributions by Means of Covariates with Examples from Poverty and Health Economics," Swiss Journal of Economics and Statistics (SJES), Swiss Society of Economics and Statistics (SSES), vol. 152(I), pages 49-80, March.
    4. Jing Dai & Stefan Sperlich & Walter Zucchini, 2011. "Estimating and Predicting Household Expenditures and Income Distributions," MAGKS Papers on Economics 201147, Philipps-Universität Marburg, Faculty of Business Administration and Economics, Department of Economics (Volkswirtschaftliche Abteilung).
    5. Ricardo Bebczuk, 2009. "SME Access to Credit in Guatemala and Nicaragua: Challenging Conventional Wisdom with New Evidence," CEDLAS, Working Papers 0080, CEDLAS, Universidad Nacional de La Plata.
    6. Javier Alejo, 2010. "Transición Demográfica y Pobreza en América Latina. Un Análisis de Microsimulaciones," CEDLAS, Working Papers 0108, CEDLAS, Universidad Nacional de La Plata.
    7. Eid, Ahmed & Aguirre, Rodrigo, 2013. "Tendencias en desigualdad de ingreso y consumo en Bolivia: un cuento de hadas de gigantes empequeñeciendo y enanos. en crecimiento," Revista Latinoamericana de Desarrollo Economico, Carrera de Economía de la Universidad Católica Boliviana (UCB) "San Pablo", issue 20, pages 75-110, Noviembre.
    8. World Bank, 2005. "Peru : Opportunities for All, Peru Poverty Assessment," World Bank Publications - Reports 8809, The World Bank Group.
    9. Yanez-Pagans, Monica, 2008. "Culture and Human Capital Investments: Evidence of an Unconditional Cash Transfer Program in Bolivia," IZA Discussion Papers 3678, Institute of Labor Economics (IZA).
    10. Carlos Alberto Foronda Rojas & Milenka Ocampo, 2008. "Retornos de la educación pública y privada: Inferencia asintótica y bootstrap en medidas de desigualdad," Investigación & Desarrollo 0308, Universidad Privada Boliviana, revised Mar 2008.
    11. repec:aru:wpaper:201304 is not listed on IDEAS

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    More about this item

    Keywords

    distribution; Bolivia; wages; decompositions; quantile; education; MDG;
    All these keywords.

    JEL classification:

    • C15 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Statistical Simulation Methods: General
    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
    • I21 - Health, Education, and Welfare - - Education - - - Analysis of Education
    • J23 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Demand
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials

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