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Inequality and Poverty under Latin America's New Left Regimes

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Author Info

  • Darryl McLeod

    ()
    (Department of Economics, Fordham University)

  • Nora Lustig

    ()
    (Department of Economics, Tulane University)

Abstract

Inequality and poverty fell sharply in many Latin American countries during a decade in which voters in ten countries chose left-leaning leaders. Are these developments related? Using data for 18 Latin American countries, this paper presents econometric evidence that social democratic regimes in Brazil and Chile were more successful at reducing inequality and poverty than the so-called populist regimes of Argentina, Bolivia, and Venezuela. Both groups implemented policies to redistribute income, but the social democratic regimes' efforts were more effective. Argentina and Venezuela started the 1990-2008 sample window with lower levels of inequality, so to some extent recent reductions in inequality are a return to "normal" levels (as estimated by fixed effects). Conversely, inequality and poverty in Brazil and Chile fell to historic lows. Second, overall terms of trade shocks were more favorable to Argentina and Venezuela, so part of the drop in inequality can be attributed to commodity price booms.

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File URL: http://econ.tulane.edu/RePEc/pdf/tul1117.pdf
File Function: First version, 2010
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Bibliographic Info

Paper provided by Tulane University, Department of Economics in its series Working Papers with number 1117.

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Length: 31 pages
Date of creation: Apr 2011
Date of revision:
Handle: RePEc:tul:wpaper:1117

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Keywords: inequality; poverty; social policy; new left; Latin America;

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References

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  1. Leonardo Gasparini & Guillermo Cruces & Leopoldo Tornarolli, 2009. "Recent trends in income inequality in Latin America," Working Papers 132, ECINEQ, Society for the Study of Economic Inequality.
  2. Maxim Pinkovskiy & Xavier Sala-i-Martin, 2009. "Parametric Estimations of the World Distribution of Income," NBER Working Papers 15433, National Bureau of Economic Research, Inc.
  3. Daron Acemoglu & Georgy Egorov & Konstantin Sonin, 2011. "A Political Theory of Populism," Levine's Working Paper Archive 661465000000001179, David K. Levine.
  4. Fernanda Brollo & Tommaso Nannicini & Roberto Perotti & Guido Tabellini, 2013. "The Political Resource Curse," American Economic Review, American Economic Association, vol. 103(5), pages 1759-96, August.
  5. Collier, Paul & Goderis, Benedikt, 2008. "Commodity Prices, Growth, and the Natural Resource Curse: Reconciling a Conundrum," MPRA Paper 17315, University Library of Munich, Germany.
  6. Giovanni Andrea cornia, 2009. "Income Distribution under Latin America’s New Left Regimes," Working Papers - Economics wp2009_16.rdf, Universita' degli Studi di Firenze, Dipartimento di Scienze per l'Economia e l'Impresa.
  7. Collier, Paul & Goderis, Benedikt, 2012. "Commodity prices and growth: An empirical investigation," European Economic Review, Elsevier, vol. 56(6), pages 1241-1260.
  8. Lustig, N. & Mcleod, D., 1996. "Minimum Wages and Poverty in Developing Countries : Some Empirical Evidence," Papers 125, Brookings Institution - Working Papers.
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Citations

Blog mentions

As found by EconAcademics.org, the blog aggregator for Economics research:
  1. Inequality and Poverty under Latin America’s New Left Regimes
    by maximorossi in NEP-LTV blog on 2011-02-21 12:20:36
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Cited by:
  1. Nancy Birdsall & Nora Lustig & Darryl McLeod, 2011. "Declining inequality in Latin America: Some economics, some politics," Working Papers 201, ECINEQ, Society for the Study of Economic Inequality.
  2. Azevedo, Joao Pedro & Davalos, Maria Eugenia & Diaz-Bonilla, Carolina & Atuesta, Bernardo & Castaneda, Raul Andres, 2013. "Fifteen years of inequality in Latin America : how have labor markets helped ?," Policy Research Working Paper Series 6384, The World Bank.
  3. Seguino, Stephanie & Braunstein, Elissa, 2012. "The impact of economic policy and structural change on gender employment inequality in Latin America, 1990-2010," MPRA Paper 43261, University Library of Munich, Germany.
  4. Kapelyuk Sergey, 2014. "Impact of minimum wage on income distribution and poverty in Russia," EERC Working Paper Series 14/03e, EERC Research Network, Russia and CIS.

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  1. Nora Lustig in Wikipedia (English)

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