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Inequality and poverty under Latin America’s new left regimes

Author

Listed:
  • Darryl McLeod

    (Fordham University)

  • Nora Lustig

    (Tulane University and Center for Global Development)

Abstract

Inequality and poverty fell sharply in many Latin American countries during a decade in which voters in ten countries chose left-leaning leaders. Are these developments related? Using data for 18 Latin American countries, this paper presents econometric evidence that social democratic regimes in Brazil and Chile were more successful at reducing inequality and poverty than the so-called populist regimes of Argentina, Bolivia, and Venezuela. Both groups implemented policies to redistribute income, but the social democratic regimes’ efforts were more effective. The left populists regimes such as Argentina and Venezuela started the 1990-2008 sample window with lower levels of inequality, so to some extent recent reductions in inequality are a return to “normal” levels (as estimated by fixed effects). Conversely, inequality and poverty in Brazil and Chile fell to historic lows. Moreover, overall terms of trade shocks were more favorable to Argentina and Venezuela, so part of the drop in inequality can be attributed to commodity price booms.

Suggested Citation

  • Darryl McLeod & Nora Lustig, 2011. "Inequality and poverty under Latin America’s new left regimes," Working Papers 208, ECINEQ, Society for the Study of Economic Inequality.
  • Handle: RePEc:inq:inqwps:ecineq2011-208
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    File URL: http://www.ecineq.org/milano/WP/ECINEQ2011-208.pdf
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    References listed on IDEAS

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    As found by EconAcademics.org, the blog aggregator for Economics research:
    1. Inequality and Poverty under Latin America’s New Left Regimes
      by maximorossi in NEP-LTV blog on 2011-02-21 18:20:36

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    Cited by:

    1. Porras, Laila, 2015. "Croissance, inégalités et pauvreté au sein des pays émergents : le cas des BRICS," Revue de la Régulation - Capitalisme, institutions, pouvoirs, Association Recherche et Régulation, vol. 18.
    2. Gibrán Cruz-Martínez, 2017. "Welfare State Development, Individual Deprivations and Income Inequality: A Cross-Country Analysis in Latin America and the Caribbean," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 134(3), pages 955-979, December.
    3. Nancy Birdsall & Nora Lustig & Darryl McLeod, 2011. "Declining inequality in Latin America: Some economics, some politics," Working Papers 201, ECINEQ, Society for the Study of Economic Inequality.
    4. Seguino, Stephanie & Braunstein, Elissa, 2012. "The impact of economic policy and structural change on gender employment inequality in Latin America, 1990-2010," MPRA Paper 43261, University Library of Munich, Germany.
    5. Leonardo Gasparini, 2019. "La Desigualdad en su Laberinto: Hechos y Perspectivas sobre Desigualdad de Ingresos en América Latina," CEDLAS, Working Papers 0256, CEDLAS, Universidad Nacional de La Plata.
    6. Carlos Felipe Balcázar, 2016. "Long-run effects of democracy on income inequality in Latin America," The Journal of Economic Inequality, Springer;Society for the Study of Economic Inequality, vol. 14(3), pages 289-307, September.
    7. Daniel L. Hicks & Beatriz Maldonado & Brian Piper & Alejandra Goytia Rios, 2018. "Identity, Patronage, and Redistribution: Economic Inequality in Bolivia under Evo Morales," Journal of Economics, Race, and Policy, Springer, vol. 1(1), pages 26-41, July.
    8. Cruz-Martinez, Gibran, 2019. "Comparative social policy in contemporary Latin America: Concepts, theories and a research agenda," SocArXiv ygh8d, Center for Open Science.
    9. Azevedo, Joao Pedro & Davalos, Maria Eugenia & Diaz-Bonilla, Carolina & Atuesta, Bernardo & Castaneda, Raul Andres, 2013. "Fifteen years of inequality in Latin America : how have labor markets helped ?," Policy Research Working Paper Series 6384, The World Bank.
    10. Verónica Amarante & Martín Brun & Cecilia Rossel, 2020. "Poverty and inequality in Latin America’s research agenda: A bibliometric review," Development Policy Review, Overseas Development Institute, vol. 38(4), pages 465-482, July.
    11. Kapelyuk Sergey, 2014. "Impact of minimum wage on income distribution and poverty in Russia," EERC Working Paper Series 14/03e, EERC Research Network, Russia and CIS.

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    More about this item

    Keywords

    inequality; poverty; social policy; new left; Latin America.;
    All these keywords.

    JEL classification:

    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
    • D33 - Microeconomics - - Distribution - - - Factor Income Distribution
    • I32 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Measurement and Analysis of Poverty
    • I38 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Government Programs; Provision and Effects of 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
    • P16 - Economic Systems - - Capitalist Systems - - - Political Economy of Capitalism

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