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Declining Inequality in Latin America in the 2000s: The Cases of Argentina, Brazil, and Mexico

Author Info

Listed author(s):
  • Lustig, Nora
  • Lopez-Calva, Luis F.
  • Ortiz-Juarez, Eduardo

Abstract

During 2000–10, the Gini coefficient declined in 13 of 17 Latin American countries. The decline was statistically significant and robust to changes in the time interval, inequality measures, and data sources. In depth country studies for Argentina, Brazil, and Mexico suggest two main phenomena underlie this trend: a fall in the premium to skilled labor and more progressive government transfers. The fall in the premium to skills resulted from a combination of supply, demand, and institutional factors. Their relative importance depends on the country.

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File URL: http://www.sciencedirect.com/science/article/pii/S0305750X12002276
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Article provided by Elsevier in its journal World Development.

Volume (Year): 44 (2013)
Issue (Month): C ()
Pages: 129-141

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Handle: RePEc:eee:wdevel:v:44:y:2013:i:c:p:129-141
DOI: 10.1016/j.worlddev.2012.09.013
Contact details of provider: Web page: http://www.elsevier.com/locate/worlddev

Keywords: income inequality; skill premium; government transfers; Latin America;

Other versions of this item:

Find related papers by JEL classification:
  • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
  • I24 - Health, Education, and Welfare - - Education - - - Education and Inequality
  • H53 - Public Economics - - National Government Expenditures and Related Policies - - - Government Expenditures and Welfare Programs
  • O15 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration
  • O54 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Latin America; Caribbean

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  1. Raymundo Campos & Gerardo Esquivel & Nora Lustig, 2012. "The Rise and Fall of Income Inequality in Mexico, 1989–2010," Working Papers 267, ECINEQ, Society for the Study of Economic Inequality.
  2. Lawrence F. Katz & Kevin M. Murphy, 1992. "Changes in Relative Wages, 1963–1987: Supply and Demand Factors," The Quarterly Journal of Economics, Oxford University Press, vol. 107(1), pages 35-78.
  3. Marco Manacorda & Carolina Sanchez-Paramo & Norbert Schady, 2010. "Changes in Returns to Education in Latin America: The Role of Demand and Supply of Skills," ILR Review, Cornell University, ILR School, vol. 63(2), pages 307-326, January.
  4. Mariano Bosch & Marco Manacorda, 2010. "Minimum Wages and Earnings Inequality in Urban Mexico," American Economic Journal: Applied Economics, American Economic Association, vol. 2(4), pages 128-149, October.
  5. Gasparini, Leonardo & Galiani, Sebastian & Cruces, Guillermo & Acosta, Pablo A., 2011. "Educational Upgrading and Returns to Skills in Latin America: Evidence from a Supply-Demand Framework, 1990-2010," IZA Discussion Papers 6244, Institute for the Study of Labor (IZA).
  6. Azevedo, Joao Pedro & Inchauste, Gabriela & Sanfelice, Viviane, 2013. "Decomposing the recent inequality decline in Latin America," Policy Research Working Paper Series 6715, The World Bank.
  7. José Antonio Ocampo & Juliana Vallejo, 2012. "Economic Growth, Equity and Human Development in Latin America," Journal of Human Development and Capabilities, Taylor & Francis Journals, vol. 13(1), pages 107-133, February.
  8. Guillermo Cruces & Leonardo Gasparini, 2008. "A Distribution in Motion: The Case of Argentina," CEDLAS, Working Papers 0078, CEDLAS, Universidad Nacional de La Plata.
  9. David De Ferranti & Guillermo E. Perry & Francisco H.G. Ferreira & Michael Walton, 2004. "Inequality in Latin America : Breaking with History?," World Bank Publications, The World Bank, number 15009, July.
  10. Diego Battistón & Carolina García-Domench & Leonardo Gasparini, 2014. "Could an Increase in Education Raise Income Inequality? Evidence for Latin America," Latin American Journal of Economics-formerly Cuadernos de Economía, Instituto de Economía. Pontificia Universidad Católica de Chile., vol. 51(1), pages 1-39, May.
  11. 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.
  12. Cruces, Guillermo & Gasparini, Leonardo, 2011. "Inequality in Education: Evidence for Latin America," WIDER Working Paper Series 093, World Institute for Development Economic Research (UNU-WIDER).
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  15. repec:idb:brikps:60098 is not listed on IDEAS
  16. Giovanni Andrea Cornia, 2010. "Income Distribution under Latin America's New Left Regimes," Journal of Human Development and Capabilities, Taylor & Francis Journals, vol. 11(1), pages 85-114.
  17. Lerman, Robert I & Yitzhaki, Shlomo, 1985. "Income Inequality Effects by Income," The Review of Economics and Statistics, MIT Press, vol. 67(1), pages 151-156, February.
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  19. Bound, John & Johnson, George, 1992. "Changes in the Structure of Wages in the 1980's: An Evaluation of Alternative Explanations," American Economic Review, American Economic Association, vol. 82(3), pages 371-392, June.
  20. Ravallion, M. & Datt, G., 1991. "Growth and Redistribution Components of Changes in Poverty Measures," Papers 83, World Bank - Living Standards Measurement.
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