IDEAS home Printed from https://ideas.repec.org/p/wbk/wbrwps/2691.html
   My bibliography  Save this paper

Evolution of earnings and rates of returns to education in Mexico

Author

Listed:
  • Lopez-Acevedo, Gladys

Abstract

Reviewing the factors, and mechanisms that have been driving inequality in earnings in Mexico, the author finds that inequality in education, accounts for the largest share by far of the variation in earnings. In fact, the contribution of educational inequality to earnings inequality in Mexico, ranks second in size in Latin America, after that in Brazil, and its significance has been increasing. Moreover, the income effect is always prevalent, and the distribution of education is highly significant, even after controlling for changes in other relevant variables, such as age, region, economic sector, and labor market status. But the increase in earnings inequality in Mexico, does not appear to be the result of a worsening in the distribution of education - although the income profile, which is related to returns to schooling, has become much steeper. This means that the shift in demand toward high-skilled labor, has not been matched by an increase in supply. The probable reason: the increased economic openness in Mexico has facilitated skill-biased technological change.

Suggested Citation

  • Lopez-Acevedo, Gladys, 2001. "Evolution of earnings and rates of returns to education in Mexico," Policy Research Working Paper Series 2691, The World Bank.
  • Handle: RePEc:wbk:wbrwps:2691
    as

    Download full text from publisher

    File URL: http://www-wds.worldbank.org/external/default/WDSContentServer/WDSP/IB/2001/12/11/000094946_01110204024950/Rendered/PDF/multi0page.pdf
    Download Restriction: no

    References listed on IDEAS

    as
    1. Shorrocks, A F, 1980. "The Class of Additively Decomposable Inequality Measures," Econometrica, Econometric Society, vol. 48(3), pages 613-625, April.
    2. Frank A. Cowell, 1980. "On the Structure of Additive Inequality Measures," Review of Economic Studies, Oxford University Press, vol. 47(3), pages 521-531.
    3. Feenstra, Robert C & Hanson, Gordon H, 1996. "Globalization, Outsourcing, and Wage Inequality," American Economic Review, American Economic Association, vol. 86(2), pages 240-245, May.
    4. Mueller, Richard E., 1998. "Public-private sector wage differentials in Canada: evidence from quantile regressions," Economics Letters, Elsevier, vol. 60(2), pages 229-235, August.
    5. Hanson, G.H. & Harrison, A., 1995. "Trade, Technology and Wage Inequality," Papers 95-20, Columbia - Graduate School of Business.
    6. Almeida dos Reis, Jose Guilherme & Paes de Barros, Ricardo, 1991. "Wage inequality and the distribution of education : A study of the evolution of regional differences in inequality in metropolitan Brazil," Journal of Development Economics, Elsevier, vol. 36(1), pages 117-143, July.
    7. Hanson, Gordon H, 1997. "Increasing Returns, Trade and the Regional Structure of Wages," Economic Journal, Royal Economic Society, vol. 107(440), pages 113-133, January.
    8. Leibbrandt, M.V. & Woolard, C.D. & Woolard, I.D., 1996. "The Contribution of Income Components to Income Inequality in South Africa. A Decomposable Gini Analysis," Papers 125a, World Bank - Living Standards Measurement.
    9. Cesar Patricio Bouillon & Arianna Legovini & Nora Lustig, 2003. "Rising Inequality in Mexico: Household Characteristics and Regional Effects," Journal of Development Studies, Taylor & Francis Journals, vol. 39(4), pages 112-133.
    10. Psacharopoulos, George, 1994. "Returns to investment in education: A global update," World Development, Elsevier, vol. 22(9), pages 1325-1343, September.
    11. Bourguignon, Francois, 1979. "Decomposable Income Inequality Measures," Econometrica, Econometric Society, vol. 47(4), pages 901-920, July.
    12. Schultz, T. Paul, 1988. "Education investments and returns," Handbook of Development Economics,in: Hollis Chenery & T.N. Srinivasan (ed.), Handbook of Development Economics, edition 1, volume 1, chapter 13, pages 543-630 Elsevier.
    13. 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.
    14. Knight, J B & Sabot, R H, 1983. "Educational Expansion and the Kuznets Effect," American Economic Review, American Economic Association, vol. 73(5), pages 1132-1136, December.
    15. 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)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. World Bank, 2005. "Mexico : Determinants of Learning Policy Note," World Bank Other Operational Studies 8284, The World Bank.
    2. repec:kap:iaecre:v:11:y:2005:i:2:p:231-242 is not listed on IDEAS
    3. Guillermo E. Perry & Omar S. Arias & J. Humberto López & William F. Maloney & Luis Servén, 2006. "Poverty Reduction and Growth : Virtuous and Vicious Circles," World Bank Publications, The World Bank, number 6997, April.
    4. Rodriguez-Oreggia, Eduardo & Lopez-Videla, Bruno, 2014. "Imputación de ingresos laborales: Una aplicación con encuestas de empleo en México
      [Labor earnings imputation: An application using labor surveys in Mexico]
      ," MPRA Paper 54436, University Library of Munich, Germany.

    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:wbk:wbrwps:2691. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Roula I. Yazigi). General contact details of provider: http://edirc.repec.org/data/dvewbus.html .

    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 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.

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

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.