The distributional implications of short-term income mobility: evidence for Latin America

In recent years, a branch of the economic literature has analyzed household income movements in longitudinal datasets. Previous research has shown that household income is considerably more volatile in Latin America than in developed economies, though little is known so far about the distributional implications of such income changes. This paper exploits the unique database built in Beccaria et al. (2022) from Latin American household surveys for seven countries in 2002-2015 to analyze the impact of household income movements on income distribution. I combine the analysis from traditional indicators in the literature with a novel methodology that quantifies this precise phenomenon and allows for comparisons and rankings across population groups and countries. My results show that Latin American economies feature less equalizing mobilitythan developed countries, although variability between countries is considerable. Moreover, the mobility pattern observed benefitted essentially all households other than those in the right tail of the income distribution. Finally, I provide more specific results for population groups defined in terms of gender and educational attainment.