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Policies for Reducing Income Inequality: Latin America During the Last Decade

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Author Info

  • Giovanni Andrea Cornia
  • Bruno Martorano

    (University of Florence)

Abstract

In most Latin American countries, income inequality rose steadily during the 1980s and 1990s, and declined from 2002 to 2007. This paper analyzes the factors that could explain the changes in income inequality from 1990 to 2007, by focusing on external shocks and changes in domestic policies. Particular reference will be made to macroeconomic, educational and social policies introduced during recent years, and to the impact of the election of an increasing number of leftof- centre governments which have come to power during the last decade. The paper tests econometrically the importance of all these factors on data for 18 countries from 1990 to 2007. On the basis of this model, the paper estimates the income inequality level for the crisis years 2008 and 2009. The results suggest that a continuation of fiscally prudent distributive and redistributive policies, which have emerged in much of the region in the 2000s, should preserve most of the income inequality gains recorded in recent years.

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File URL: http://www.unicef.org/socialpolicy/files/Postscript_Formatted_Policies_for_reducing_income_inequality.pdf
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Bibliographic Info

Paper provided by UNICEF,Division of Policy and Strategy in its series Working papers with number 1006.

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Length: 50 pages
Date of creation: 2010
Date of revision:
Handle: RePEc:uce:wpaper:1006

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Related research

Keywords: Latin America; Income Inequality; domestic policies; educational and social policies; redistributive policies; financial crisis.;

References

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  1. Esteban Pérez Caldentey & Matías Vernengo, 2010. "Back to the future: Latin America's current development strategy," Journal of Post Keynesian Economics, M.E. Sharpe, Inc., vol. 32(4), pages 623-644, July.
  2. Roberto Frenkel & Martin Rapetti, 2008. "Five years of competitive and stable real exchange rate in Argentina, 2002-2007," International Review of Applied Economics, Taylor & Francis Journals, vol. 22(2), pages 215-226.
  3. Ariel Fiszbein & Norbert Schady & Francisco H. G. Ferreira & Margaret Grosh & Niall Keleher & Pedro Olinto & Emmanuel Skoufias, 2009. "Conditional Cash Transfers : Reducing Present and Future Poverty," World Bank Publications, The World Bank, number 2597, August.
  4. Kristensen, Nicolai & Cunningham, Wendy, 2006. "Do minimum wages in Latin America and the Caribbean matter ? Evidence from 19 countries," Policy Research Working Paper Series 3870, The World Bank.
  5. Leonardo Gasparini & Guillermo Cruces & Leopoldo Tornarolli & Mariana Marchionni, 2009. "A Turning Point? Recent Developments on Inequality in Latin America and the Caribbean," CEDLAS, Working Papers 0081, CEDLAS, Universidad Nacional de La Plata.
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Cited by:
  1. Bruno Martorano & Marco Sanfilippo & UNICEF Innocenti Research Centre, 2012. "Innovative Features in Conditional Cash Transfers: An impact evaluation of Chile Solidario on households and children," Innocenti Working Papers inwopa656, UNICEF Innocenti Research Centre.
  2. Isabel Ortiz & Matthew Cummins, 2011. "Global Inequality: Beyond the Bottom Billion – A Rapid Review of Income Distribution in 141 Countries," Working papers 1102, UNICEF,Division of Policy and Strategy.

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