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Human capital and earnings inequality in Brazil, 1988-98 : quantile regression evidence

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Author Info
G. Reza Arabsheibani
Francisco Galrao Carneiro
Andrew Henley

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Abstract

The authors undertake an empirical examination of rates of return to human capital for men in Brazil, through the period of macroeconomic stabilization and trade liberalization, using data from the 1988, 1992, and 1998 Brazilian household surveys (Pesquisa Nacional por Amostra de Domic?os, PNAD). The authors estimate simultaneous quantile equations to gain an insight on the impact of human capital on wages across the hourly earnings distribution. They conclude that there is evidence of growing inequality in rates of return to education in Brazil. But the authors find evidence that education is no longer used as a screening device in the labor market, but rather rewarded for its innate association with higher productivity. Although increases in rates of return to education have been more pronounced at the top of the earnings distribution, this has not led to increased inequality. This is because the levels of education and other labor market-rewarded endowments have increased and offset the rate of return effect.

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Paper provided by The World Bank in its series Policy Research Working Paper Series with number 3147.

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Date of creation: 01 Oct 2003
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Handle: RePEc:wbk:wbrwps:3147

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Keywords: Public Health Promotion; Decentralization; Health Monitoring&Evaluation; Curriculum&Instruction; Teaching and Learning; Economic Theory&Research; Fiscal&Monetary Policy; Curriculum&Instruction; Teaching and Learning; Health Monitoring&Evaluation;

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Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
  1. Jorge Saba Arbache & Carlos Henrique Corseuil, 2004. "Liberalização Comercial e Estruturas de Emprego e Salário," Revista Brasileira de Economia, Graduate School of Economics, Getulio Vargas Foundation (Brazil), vol. 58(4), April. [Downloadable!]
  2. Koenker, Roger W & Bassett, Gilbert, Jr, 1978. "Regression Quantiles," Econometrica, Econometric Society, vol. 46(1), pages 33-50, January. [Downloadable!] (restricted)
  3. Lee, Kiong-Hock, 1980. "Screening, ability, and the productivity of education in Malaysia," Economics Letters, Elsevier, vol. 5(2), pages 189-193. [Downloadable!] (restricted)
  4. Psacharopoulos, George, 1979. "On the weak versus the strong version of the screening hypothesis," Economics Letters, Elsevier, vol. 4(2), pages 181-185. [Downloadable!] (restricted)
  5. Carneiro, Francisco G., 1998. "Productivity effects in brazilian wage determination," World Development, Elsevier, vol. 26(1), pages 139-153, January. [Downloadable!] (restricted)
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Cited by:
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  1. João Pedro W. de Azevedo, 2004. "Entrepreneurship And Liquidity Constraints In Deprived Areas: Evidence From The Slums Of Rio De Janeiro," Anais do XXXII Encontro Nacional de Economia [Proceedings of the 32th Brazilian Economics Meeting] 135, ANPEC - Associação Nacional dos Centros de Pósgraduação em Economia [Brazilian Association of Graduate Programs in Economics]. [Downloadable!]
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