IDEAS home Printed from https://ideas.repec.org/p/nbr/nberwo/31459.html
   My bibliography  Save this paper

Globalization and Inequality in Latin America

Author

Listed:
  • Rafael Dix-Carneiro
  • Brian K. Kovak

Abstract

We survey the recent literature studying the effects of globalization on inequality in Latin America. Our focus is on research emerging from the late 2000s onward, with an emphasis on empirical work considering new mechanisms, studying new dimensions of inequality, and developing new methodologies to capture the many facets of globalization's relationship to inequality. After summarizing both design-based and quantitative work in this area, we propose directions for future work. Our overarching recommendation is that researchers develop unifying frameworks to help synthesize the results of individual studies that focus on distinct aspects of globalization's relationship to inequality.

Suggested Citation

  • Rafael Dix-Carneiro & Brian K. Kovak, 2023. "Globalization and Inequality in Latin America," NBER Working Papers 31459, National Bureau of Economic Research, Inc.
  • Handle: RePEc:nbr:nberwo:31459
    Note: DEV ITI LS
    as

    Download full text from publisher

    File URL: http://www.nber.org/papers/w31459.pdf
    Download Restriction: Access to the full text is generally limited to series subscribers, however if the top level domain of the client browser is in a developing country or transition economy free access is provided. More information about subscriptions and free access is available at http://www.nber.org/wwphelp.html. Free access is also available to older working papers.
    ---><---

    As the access to this document is restricted, you may want to look for a different version below or search for a different version of it.

    Other versions of this item:

    References listed on IDEAS

    as
    1. Verónica Escudero & Jochen Kluve & Elva López Mourelo & Clemente Pignatti, 2019. "Active Labour Market Programmes in Latin America and the Caribbean: Evidence from a Meta-Analysis," Journal of Development Studies, Taylor & Francis Journals, vol. 55(12), pages 2644-2661, December.
    2. Gonzaga, Gustavo & Menezes Filho, Naercio & Terra, Cristina, 2006. "Trade liberalization and the evolution of skill earnings differentials in Brazil," Journal of International Economics, Elsevier, vol. 68(2), pages 345-367, March.
    3. David McKenzie, 2017. "How Effective Are Active Labor Market Policies in Developing Countries? A Critical Review of Recent Evidence," The World Bank Research Observer, World Bank, vol. 32(2), pages 127-154.
    4. David Autor & David Dorn & Gordon Hanson & Kaveh Majlesi, 2020. "Importing Political Polarization? The Electoral Consequences of Rising Trade Exposure," American Economic Review, American Economic Association, vol. 110(10), pages 3139-3183, October.
    5. Petia Topalova, 2010. "Factor Immobility and Regional Impacts of Trade Liberalization: Evidence on Poverty from India," American Economic Journal: Applied Economics, American Economic Association, vol. 2(4), pages 1-41, October.
    6. Costa, Francisco & Garred, Jason & Pessoa, João Paulo, 2016. "Winners and losers from a commodities-for-manufactures trade boom," Journal of International Economics, Elsevier, vol. 102(C), pages 50-69.
    7. Sandra E. Black & Elizabeth Brainerd, 2004. "Importing Equality? The Impact of Globalization on Gender Discrimination," ILR Review, Cornell University, ILR School, vol. 57(4), pages 540-559, July.
    8. Hirata, Guilherme & Soares, Rodrigo R., 2020. "Competition and the racial wage gap: Evidence from Brazil," Journal of Development Economics, Elsevier, vol. 146(C).
    9. Naércio Aquino Menezes Filho & Marc-Andreas Muendler, 2007. "Labor Reallocation in Response to Trade Reform," CESifo Working Paper Series 1936, CESifo.
    10. Rafael Dix-Carneiro & João Paulo Pessoa & Ricardo Reyes-Heroles & Sharon Traiberman, 2023. "Globalization, Trade Imbalances, and Labor Market Adjustment," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 138(2), pages 1109-1171.
    11. Paz, Lourenço S., 2014. "The impacts of trade liberalization on informal labor markets: A theoretical and empirical evaluation of the Brazilian case," Journal of International Economics, Elsevier, vol. 92(2), pages 330-348.
    12. Carmen Pagés-Serra, 2000. "The Cost of Job Security Regulation: Evidence from Latin American Labor Markets," Economía Journal, The Latin American and Caribbean Economic Association - LACEA, vol. 0(Fall 2000), pages 109-154, August.
    13. Melvin Stephens, 2002. "Worker Displacement and the Added Worker Effect," Journal of Labor Economics, University of Chicago Press, vol. 20(3), pages 504-537, July.
    14. Sergey Nigai, 2016. "On Measuring the Welfare Gains from Trade Under Consumer Heterogeneity," Economic Journal, Royal Economic Society, vol. 126(593), pages 1193-1237, June.
    15. A. Kerem Co?ar & Nezih Guner & James Tybout, 2016. "Firm Dynamics, Job Turnover, and Wage Distributions in an Open Economy," American Economic Review, American Economic Association, vol. 106(3), pages 625-663, March.
    16. Feenstra, Robert C. & Lewis, Tracy R., 1994. "Trade adjustment assistance and Pareto gains from trade," Journal of International Economics, Elsevier, vol. 36(3-4), pages 201-222, May.
    17. Kirill Borusyak & Xavier Jaravel, 2018. "The Distributional Effects of Trade: Theory and Evidence from the United States," 2018 Meeting Papers 284, Society for Economic Dynamics.
    18. Ornelas, Emanuel & Ogeda, Pedro & Soares, Rodrigo, 2021. "Labor Unions and the Electoral Consequences of Trade Liberalization," CEPR Discussion Papers 16721, C.E.P.R. Discussion Papers.
    19. Camila Cisneros-Acevedo, 2022. "Unfolding Trade Effect in Two Margins of Informality. The Peruvian Case," The World Bank Economic Review, World Bank, vol. 36(1), pages 141-170.
    20. Irene Brambilla & Daniel Lederman & Guido Porto, 2012. "Exports, Export Destinations, and Skills," American Economic Review, American Economic Association, vol. 102(7), pages 3406-3438, December.
    21. Rafael Dix‐Carneiro, 2014. "Trade Liberalization and Labor Market Dynamics," Econometrica, Econometric Society, vol. 82(3), pages 825-885, May.
    22. Rafael Dix-Carneiro, 2019. "Trade and Informality in the Presence of Labor Market Frictions and Regulations," 2019 Meeting Papers 144, Society for Economic Dynamics.
    23. Che, Yi & Lu, Yi & Pierce, Justin R. & Schott, Peter K. & Tao, Zhigang, 2022. "Did trade liberalization with China influence US elections?," Journal of International Economics, Elsevier, vol. 139(C).
    24. Goldin, Claudia, 2006. "The Quiet Revolution That Transformed Women’s Employment, Education, and Family," Scholarly Articles 2943933, Harvard University Department of Economics.
    25. Koujianou Goldberg, Pinelopi & Pavcnik, Nina, 2003. "The response of the informal sector to trade liberalization," Journal of Development Economics, Elsevier, vol. 72(2), pages 463-496, December.
    26. Pamela Bombarda & Maria Bas, 2023. "Foreign Technology and Informal Employment: Evidence from Mexico," THEMA Working Papers 2023-02, THEMA (THéorie Economique, Modélisation et Applications), Université de Cergy-Pontoise.
    27. Guillermo Cruces & Guido Porto & Mariana Viollaz, 2018. "Trade liberalization and informality in Argentina: exploring the adjustment mechanisms," Latin American Economic Review, Springer;Centro de Investigaciòn y Docencia Económica (CIDE), vol. 27(1), pages 1-29, December.
    28. Rafael Dix-Carneiro & Rodrigo R. Soares & Gabriel Ulyssea, 2018. "Economic Shocks and Crime: Evidence from the Brazilian Trade Liberalization," American Economic Journal: Applied Economics, American Economic Association, vol. 10(4), pages 158-195, October.
    29. David Atkin, 2016. "Endogenous Skill Acquisition and Export Manufacturing in Mexico," American Economic Review, American Economic Association, vol. 106(8), pages 2046-2085, August.
    30. Wolfgang Dauth & Sebastian Findeisen & Jens Suedekum, 2014. "The Rise Of The East And The Far East: German Labor Markets And Trade Integration," Journal of the European Economic Association, European Economic Association, vol. 12(6), pages 1643-1675, December.
    31. David Atkin & Benjamin Faber & Marco Gonzalez-Navarro, 2018. "Retail Globalization and Household Welfare: Evidence from Mexico," Journal of Political Economy, University of Chicago Press, vol. 126(1), pages 1-73.
    32. David Autor & David Dorn & Gordon Hanson, 2019. "When Work Disappears: Manufacturing Decline and the Falling Marriage Market Value of Young Men," American Economic Review: Insights, American Economic Association, vol. 1(2), pages 161-178, September.
    33. David H. Autor & David Dorn & Gordon H. Hanson, 2013. "The China Syndrome: Local Labor Market Effects of Import Competition in the United States," American Economic Review, American Economic Association, vol. 103(6), pages 2121-2168, October.
    34. Sarra Ben Yahmed & Pamela Bombarda, 2020. "Gender, Informal Employment and Trade Liberalization in Mexico," The World Bank Economic Review, World Bank, vol. 34(2), pages 259-283.
    35. Sharon Traiberman, 2019. "Occupations and Import Competition: Evidence from Denmark," American Economic Review, American Economic Association, vol. 109(12), pages 4260-4301, December.
    36. He, Zheli, 2019. "Trade and Real Wages of the Rich and Poor: Evidence from Brazil and Mexico," IDB Publications (Working Papers) 9961, Inter-American Development Bank.
    37. Diaz Gutierrez, Julian, 2023. "Trade Effects on Substance Abuse: Evidence from Colombia's Liberalization," 2023 Annual Meeting, July 23-25, Washington D.C. 335460, Agricultural and Applied Economics Association.
    38. Porto, Guido G., 2006. "Using survey data to assess the distributional effects of trade policy," Journal of International Economics, Elsevier, vol. 70(1), pages 140-160, September.
    39. Eric A. Verhoogen, 2008. "Trade, Quality Upgrading, and Wage Inequality in the Mexican Manufacturing Sector," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 123(2), pages 489-530.
    40. Juan Blyde & Matias Busso & Kyunglin Park & Dario Romero, 2023. "Short‐ and long‐run labor market adjustment to import competition," Review of International Economics, Wiley Blackwell, vol. 31(4), pages 1552-1569, September.
    41. Romain Wacziarg & Karen Horn Welch, 2008. "Trade Liberalization and Growth: New Evidence," The World Bank Economic Review, World Bank, vol. 22(2), pages 187-231, June.
    42. Alan V. Deardorff & Robert W. STAIGER, 2011. "An Interpretation Of The Factor Content Of Trade," World Scientific Book Chapters, in: Robert M Stern (ed.), Comparative Advantage, Growth, And The Gains From Trade And Globalization A Festschrift in Honor of Alan V Deardorff, chapter 38, pages 531-545, World Scientific Publishing Co. Pte. Ltd..
    43. Lorenzo Caliendo & Maximiliano Dvorkin & Fernando Parro, 2019. "Trade and Labor Market Dynamics: General Equilibrium Analysis of the China Trade Shock," Econometrica, Econometric Society, vol. 87(3), pages 741-835, May.
    44. Orazio Attanasio & Arlen Guarín & Carlos Medina & Costas Meghir, 2017. "Vocational Training for Disadvantaged Youth in Colombia: A Long-Term Follow-Up," American Economic Journal: Applied Economics, American Economic Association, vol. 9(2), pages 131-143, April.
    45. Rafael Dix-Carneiro & Pinelopi K. Goldberg & Costas Meghir & Gabriel Ulyssea, 2021. "Trade and Domestic Distortions: the Case of Informality," NBER Working Papers 28391, National Bureau of Economic Research, Inc.
    46. CataÞo, Luis & Pagés, Carmen & Rosales, María Fernanda, 2009. "Financial Dependence, Formal Credit and Informal Jobs: New Evidence from Brazilian Household Data," IDB Publications (Working Papers) 1100, Inter-American Development Bank.
    47. Elhanan Helpman & Oleg Itskhoki & Stephen Redding, 2010. "Inequality and Unemployment in a Global Economy," Econometrica, Econometric Society, vol. 78(4), pages 1239-1283, July.
    48. Erhan Artuç & Shubham Chaudhuri & John McLaren, 2010. "Trade Shocks and Labor Adjustment: A Structural Empirical Approach," American Economic Review, American Economic Association, vol. 100(3), pages 1008-1045, June.
    49. Sofía Fernández Guerrico, 2021. "The effects of trade-induced worker displacement on health and mortality in Mexico," ULB Institutional Repository 2013/340349, ULB -- Universite Libre de Bruxelles.
    50. Juhn, Chinhui & Ujhelyi, Gergely & Villegas-Sanchez, Carolina, 2014. "Men, women, and machines: How trade impacts gender inequality," Journal of Development Economics, Elsevier, vol. 106(C), pages 179-193.
    51. Gabriel Ulyssea, 2018. "Firms, Informality, and Development: Theory and Evidence from Brazil," American Economic Review, American Economic Association, vol. 108(8), pages 2015-2047, August.
    52. Hani Mansour & Pamela Medina & Andrea Velásquez, 2022. "Import Competition and Gender Differences in Labor Reallocation," CESifo Working Paper Series 9639, CESifo.
    53. Ana Cecília Fieler & Marcela Eslava & Daniel Yi Xu, 2018. "Trade, Quality Upgrading, and Input Linkages: Theory and Evidence from Colombia," American Economic Review, American Economic Association, vol. 108(1), pages 109-146, January.
    54. Gueorgui Kambourov, 2009. "Labour Market Regulations and the Sectoral Reallocation of Workers: The Case of Trade Reforms," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 76(4), pages 1321-1358.
    55. Artuc, Erhan & Porto, Guido & Rijkers, Bob, 2019. "Trading off the income gains and the inequality costs of trade policy," Journal of International Economics, Elsevier, vol. 120(C), pages 1-45.
    56. Francesco Iacoella & Patricia Justino & Bruno Martorano, 2020. "Roots of dissent: Trade liberalization and the rise of populism in Brazil," WIDER Working Paper Series wp-2020-118, World Institute for Development Economic Research (UNU-WIDER).
    57. Jones, Ronald W., 1975. "Income distribution and effective protection in a multicommodity trade model," Journal of Economic Theory, Elsevier, vol. 11(1), pages 1-15, August.
    58. Claudia Goldin, 2006. "The Quiet Revolution That Transformed Women's Employment, Education, and Family," American Economic Review, American Economic Association, vol. 96(2), pages 1-21, May.
    59. Isis Gaddis & Janneke Pieters, 2017. "The Gendered Labor Market Impacts of Trade Liberalization: Evidence from Brazil," Journal of Human Resources, University of Wisconsin Press, vol. 52(2), pages 457-490.
    60. Hale Utar, 2018. "Workers beneath the Floodgates: Low-Wage Import Competition and Workers’ Adjustment," The Review of Economics and Statistics, MIT Press, vol. 100(4), pages 631-647, October.
    61. Dix-Carneiro, Rafael & Traiberman, Sharon, 2023. "Globalization, trade imbalances and inequality," Journal of Monetary Economics, Elsevier, vol. 133(C), pages 48-72.
    62. Pinelopi Koujianou Goldberg & Nina Pavcnik, 2007. "Distributional Effects of Globalization in Developing Countries," Journal of Economic Literature, American Economic Association, vol. 45(1), pages 39-82, March.
    63. Fernando Parro, 2013. "Capital-Skill Complementarity and the Skill Premium in a Quantitative Model of Trade," American Economic Journal: Macroeconomics, American Economic Association, vol. 5(2), pages 72-117, April.
    64. Mansour, Hani & Medina, Pamela & Velásquez, Andrea, 2022. "Import competition and gender differences in labor reallocation," Labour Economics, Elsevier, vol. 76(C).
    65. Brian K. Kovak, 2013. "Regional Effects of Trade Reform: What Is the Correct Measure of Liberalization?," American Economic Review, American Economic Association, vol. 103(5), pages 1960-1976, August.
    66. Vladimir Ponczek & Gabriel Ulyssea, 2022. "Enforcement of Labour Regulation and the Labour Market Effects of Trade: Evidence from Brazil," The Economic Journal, Royal Economic Society, vol. 132(641), pages 361-390.
    67. Rafael Dix-Carneiro & Brian K. Kovak, 2015. "Trade Liberalization and the Skill Premium: A Local Labor Markets Approach," American Economic Review, American Economic Association, vol. 105(5), pages 551-557, May.
    68. Rafael Dix-Carneiro, 2019. "Trade and Informality in the Presence of Labor Market Frictions and Regulations," 2019 Meeting Papers 144, Society for Economic Dynamics.
    69. Bosch, Mariano & Goñi-Pacchioni, Edwin & Maloney, William, 2012. "Trade liberalization, labor reforms and formal–informal employment dynamics," Labour Economics, Elsevier, vol. 19(5), pages 653-667.
    70. Maria Bas & Pamela Bombarda, 2023. "Input-Trade Liberalization and Formal Employment: Evidence from Mexico," Documents de travail du Centre d'Economie de la Sorbonne 23007, Université Panthéon-Sorbonne (Paris 1), Centre d'Economie de la Sorbonne.
    71. Brussevich, Masha, 2018. "Does trade liberalization narrow the gender wage gap? The role of sectoral mobility," European Economic Review, Elsevier, vol. 109(C), pages 305-333.
    72. Catão, Luis A. V. & Pagés, Carmen & Rosales, Maria Fernanda, 2009. "Financial Dependence, Formal Credit, and Informal Jobs: New Evidence from Brazilian Household Data," IZA Discussion Papers 4609, Institute for the Study of Labor (IZA).
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. César, Andrés & Falcone, Guillermo & Gasparini, Leonardo, 2021. "Costs and benefits of trade shocks: Evidence from Chilean local labor markets," Labour Economics, Elsevier, vol. 73(C).
    2. Connolly, Laura, 2022. "The effects of a trade shock on gender-specific labor market outcomes in Brazil," Labour Economics, Elsevier, vol. 74(C).
    3. Sarra Ben Yahmed & Pamela Bombarda, 2020. "Gender, Informal Employment and Trade Liberalization in Mexico," The World Bank Economic Review, World Bank, vol. 34(2), pages 259-283.
    4. Dix-Carneiro, Rafael & Kovak, Brian K., 2019. "Margins of labor market adjustment to trade," Journal of International Economics, Elsevier, vol. 117(C), pages 125-142.
    5. Muendler, Marc-Andreas, 2017. "Trade, technology, and prosperity: An account of evidence from a labor-market perspective," WTO Staff Working Papers ERSD-2017-15, World Trade Organization (WTO), Economic Research and Statistics Division.
    6. Rafael Dix-Carneiro & Brian K. Kovak, 2017. "Trade Liberalization and Regional Dynamics," American Economic Review, American Economic Association, vol. 107(10), pages 2908-2946, October.
    7. L. Alan Winters & Antonio Martuscelli, 2014. "Trade Liberalization and Poverty: What Have We Learned in a Decade?," Annual Review of Resource Economics, Annual Reviews, vol. 6(1), pages 493-512, October.
    8. Pavcnik, Nina & Goldberg, Pinelopi, 2016. "The Effects of Trade Policy," CEPR Discussion Papers 11104, C.E.P.R. Discussion Papers.
    9. Wang, Feicheng & Liang, Zhe & Lehmann, Hartmut, 2021. "Import competition and informal employment: Empirical evidence from China," University of Göttingen Working Papers in Economics 426, University of Goettingen, Department of Economics.
    10. Nina Pavcnik, 2017. "The Impact of Trade on Inequality in Developing Countries," NBER Working Papers 23878, National Bureau of Economic Research, Inc.
    11. Rafael Dix-Carneiro & Brian K. Kovak, 2015. "Trade Reform and Regional Dynamics: Evidence From 25 Years of Brazilian Matched Employer-Employee Data," NBER Working Papers 20908, National Bureau of Economic Research, Inc.
    12. Ulyssea, Gabriel & Ponczek, Vladimir, 2018. "Enforcement of Labor Regulation and the Labor Market Effects of Trade: Evidence from Brazil," IZA Discussion Papers 11783, Institute of Labor Economics (IZA).
    13. Stephen J. Redding, 2020. "Trade and Geography," NBER Working Papers 27821, National Bureau of Economic Research, Inc.
    14. Felipe Benguria & Josh Ederington, 2023. "Decomposing the effect of trade on the gender wage gap," Canadian Journal of Economics/Revue canadienne d'économique, John Wiley & Sons, vol. 56(3), pages 1082-1120, August.
    15. Manuel Fernández & Gabriela Serrano, 2022. "New Perspectives on Inequality in Latin America," Documentos CEDE 20295, Universidad de los Andes, Facultad de Economía, CEDE.
    16. Margaret S. McMillan & Brian McCaig, 2019. "Trade Liberalization and Labor Market Adjustment in Botswana," NBER Working Papers 26326, National Bureau of Economic Research, Inc.
    17. Costinot, Arnaud & Adao, Rodrigo & Carrillo, Paul & Donaldson, Dave & Pomeranz, Dina, 2020. "International Trade and Earnings Inequality: A New Factor Content Approach," CEPR Discussion Papers 15598, C.E.P.R. Discussion Papers.
    18. Vrolijk, Kasper, 2023. "How does globalisation affect social cohesion?," IDOS Discussion Papers 5/2023, German Institute of Development and Sustainability (IDOS).
    19. David H. Autor & David Dorn & Gordon H. Hanson & Jae Song, 2014. "Trade Adjustment: Worker-Level Evidence," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 129(4), pages 1799-1860.
    20. Dai, Mi & Huang, Wei & Zhang, Yifan, 2021. "How do households adjust to tariff liberalization? Evidence from China's WTO accession," Journal of Development Economics, Elsevier, vol. 150(C).

    More about this item

    JEL classification:

    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • F62 - International Economics - - Economic Impacts of Globalization - - - Macroeconomic Impacts
    • F66 - International Economics - - Economic Impacts of Globalization - - - Labor
    • J0 - Labor and Demographic Economics - - General
    • O10 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - General

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:nbr:nberwo:31459. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: the person in charge (email available below). General contact details of provider: https://edirc.repec.org/data/nberrus.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.