Changes in Human Capital and Wage Inequality in Mexico
Over the last two decades, Mexico has witnessed a significant increase in wage inequality, typically attributed to the increase in relative demand for skilled labour. Over this period, educational achievements and their distribution across the labour force have also changed substantially. In this paper, the impact of changes in human capital on wage inequality in Mexico is analysed. The analysis focuses on decomposing the level of inequality in any given year and the change in inequality over time into observable (e.g. age, education, etc.) and unobservable differences across workers. The main findings of this paper are that unobservable factors account for most of the inequality in any given year; among the observable factors, human capital emerges as the most important variable explaining the level of inequality in any given year, and, further, it is the changes in human capital, specifically the returns to education, that are mainly responsible for the observed changes in inequality.
Volume (Year): 39 (2011)
Issue (Month): 3 (February)
|Contact details of provider:|| Web page: http://www.tandfonline.com/CODS20|
|Order Information:||Web: http://www.tandfonline.com/pricing/journal/CODS20|
References listed on IDEAS
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.:
- David Fairris & Gurleen Popli & Eduardo Zepeda, 2008. "Minimum Wages and the Wage Structure in Mexico," Review of Social Economy, Taylor & Francis Journals, vol. 66(2), pages 181-208.
- Behrman, Jere R & Deolalikar, Anil B, 1991. "School Repetition, Dropouts, and the Rates of Return to Schooling: The Case of Indonesia," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 53(4), pages 467-480, November.
- Binder, Melissa & Woodruff, Christopher, 2002. "Inequality and Intergenerational Mobility in Schooling: The Case of Mexico," Economic Development and Cultural Change, University of Chicago Press, vol. 50(2), pages 249-267, January.
- Feenstra, Robert C. & Hanson, Gordon H., 1997.
"Foreign direct investment and relative wages: Evidence from Mexico's maquiladoras,"
Journal of International Economics,
Elsevier, vol. 42(3-4), pages 371-393, May.
- Robert C. Feenstra & Gordon H. Hanson, 1995. "Foreign Direct Investment and Relative Wages: Evidence from Mexico's Maquiladoras," NBER Working Papers 5122, National Bureau of Economic Research, Inc.
- David Fairris, 2003. "Unions and Wage Inequality in Mexico," ILR Review, Cornell University, ILR School, vol. 56(3), pages 481-497, April.
- Gordon H. Hanson & Ann Harrison, 1999. "Trade Liberalization and Wage Inequality in Mexico," ILR Review, Cornell University, ILR School, vol. 52(2), pages 271-288, January.
- Juhn, Chinhui & Murphy, Kevin M & Pierce, Brooks, 1993. "Wage Inequality and the Rise in Returns to Skill," Journal of Political Economy, University of Chicago Press, vol. 101(3), pages 410-442, June.
- Card, David, 2001. "Estimating the Return to Schooling: Progress on Some Persistent Econometric Problems," Econometrica, Econometric Society, vol. 69(5), pages 1127-1160, September.
- David Card, 2000. "Estimating the Return to Schooling: Progress on Some Persistent Econometric Problems," NBER Working Papers 7769, National Bureau of Economic Research, Inc.
- Lerman, Robert I. & Yitzhaki, Shlomo, 1989. "Improving the accuracy of estimates of Gini coefficients," Journal of Econometrics, Elsevier, vol. 42(1), pages 43-47, September.
- Cortez, Willy W., 2001. "What is Behind Increasing Wage Inequality in Mexico?," World Development, Elsevier, vol. 29(11), pages 1905-1922, November.
- Cragg, Michael Ian & Epelbaum, Mario, 1996. "Why has wage dispersion grown in Mexico? Is it the incidence of reforms or the growing demand for skills?," Journal of Development Economics, Elsevier, vol. 51(1), pages 99-116, October. Full references (including those not matched with items on IDEAS)