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Inequality in Latin America : determinants and consequences

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Author Info

  • Lopez , J. Humberto
  • Perry, Guillermo

Abstract

Latin America is together with Sub-Saharan Africa the most unequal region of the world. This paper documents recent inequality trends in the Latin American region, going beyond traditional measures of income inequality. The paper also reviews some of the explanations that have been put forward to understand the current situation, and discusses why reducing income inequality should be an important policy priority. In particular, the authors discuss channels through which inequality can affect growth and output volatility. On the whole, the analysis suggests a two-pronged approach to reduce inequality in the region that combines policies aimed at improving the distribution of assets (especially education) with elements aimed at improving the capacity of the state to redistribute income through taxes and transfers.

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Bibliographic Info

Paper provided by The World Bank in its series Policy Research Working Paper Series with number 4504.

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Date of creation: 01 Feb 2008
Date of revision:
Handle: RePEc:wbk:wbrwps:4504

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Related research

Keywords: Inequality; Rural Poverty Reduction; Economic Conditions and Volatility; Achieving Shared Growth; Poverty Impact Evaluation;

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References

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  8. Hongyi Li & Heng-fu Zou, 1998. "Income Inequality Is Not Harmful for Growth: Theory and Evidence," CEMA Working Papers 74, China Economics and Management Academy, Central University of Finance and Economics.
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  16. Lopez, Humberto & Serven, Luis, 2006. "A normal relationship ? Poverty, growth, and inequality," Policy Research Working Paper Series 3814, The World Bank.
  17. Lykke Andersen, 2001. "Social Mobility in Latin America: Links with Adolescent Schooling," Research Department Publications 3130, Inter-American Development Bank, Research Department.
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Citations

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Cited by:
  1. Jeffrey G. Williamson, 2009. "Five Centuries of Latin American Inequality," NBER Working Papers 15305, National Bureau of Economic Research, Inc.
  2. Jean-Paul Faguet & Mahvish Shami, 2008. "Fiscal policy and spatial inequality in Latin America and beyond," LSE Research Online Documents on Economics 27162, London School of Economics and Political Science, LSE Library.
  3. Dobado González, Rafael & García Montero, Héctor, 2010. "Colonial Origins of Inequality in Hispanic America? Some Reflections Based on New Empirical Evidence," Revista de Historia Económica, Cambridge University Press, vol. 28(02), pages 253-277, September.
  4. Carlyn Dobson & Antonio Rodríguez, 2010. "Is Corruption Really Bad for Inequality? Evidence from Latin America," Development Research Working Paper Series 02/2010, Institute for Advanced Development Studies.
  5. Raymundo M. Campos Vázquez & Andrés Hincapie & Rubén I. Rojas Valdés, 2011. "Family Income Inequality and the Role of Wives Earnings in Mexico: 1988-2010," Serie documentos de trabajo del Centro de Estudios Económicos 2011-07, El Colegio de México, Centro de Estudios Económicos.
  6. Rabindra Bhandari & Gyan Pradhan & Mukti Upadhyay, 2010. "Another empirical look at the Kuznets curve," International Journal of Economic Sciences and Applied Research (IJESAR), Technological Educational Institute (TEI) of Kavala, Greece, vol. 3(2), pages 7-19, December.

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