Wage Inequality in Latin America : Understanding the Past to Prepare for the Future

What caused the decline in wage inequality of the 2000s in Latin America? Looking to the future, will the current economic slowdown be regressive? Wage Inequality in Latin America: Understanding the Past to Prepare for the Future addresses these two questions by reviewing relevant literature and pro...

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Bibliographic Details
Main Authors:	Messina, Julian, Silva, Joana
Format:	Book
Language:	English
Published:	Washington, DC: World Bank 2017
Subjects:	INEQUALITY ECONOMIC DEVELOPMENT WAGE LATIN AMERICA ECONOMIC BOOM FIRM HETEROGENEITY EARNINGS INEQUALITY EDUCATION EXPANSION LABOR MARKETS
Online Access:	http://hdl.handle.net/10986/28682

id	okr-10986-28682
recordtype	oai_dc
spelling	okr-10986-286822021-04-23T14:04:49Z Wage Inequality in Latin America : Understanding the Past to Prepare for the Future Messina, Julian Silva, Joana INEQUALITY ECONOMIC DEVELOPMENT WAGE LATIN AMERICA ECONOMIC BOOM FIRM HETEROGENEITY EARNINGS INEQUALITY EDUCATION EXPANSION LABOR MARKETS What caused the decline in wage inequality of the 2000s in Latin America? Looking to the future, will the current economic slowdown be regressive? Wage Inequality in Latin America: Understanding the Past to Prepare for the Future addresses these two questions by reviewing relevant literature and providing new evidence on what we know from the conceptual, empirical, and policy perspectives. The answer to the first question can be broken down into several parts, although the bottom line is that the changes in wage inequality resulted from a combination of three forces: (a) education expansion and its effect on falling returns to skill (the supply-side story); (b) shifts in aggregate domestic demand; and (c) exchange rate appreciation from the commodity boom and the associated shift to the nontradable sector that changed interfirm wage differences. Other forces had a non-negligible but secondary role in some countries, while they were not present in others. These include the rapid increase of the minimum wage and a rapid trend toward formalization of employment, which played a supporting role but only during the boom. Understanding the forces behind recent trends also helps to shed light on the second question. The analysis in this volume suggests that the economic slowdown is putting the brakes on the reduction of inequality in Latin America and will likely continue to do so—but it might not actually reverse the region’s movement toward less wage inequality. 2017-11-06T22:33:59Z 2017-11-06T22:33:59Z 2018 Book 978-1-4648-1039-8 http://hdl.handle.net/10986/28682 English Latin American Development Forum; CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo World Bank Washington, DC: World Bank Publications & Research Publications & Research :: Publication Latin America & Caribbean Caribbean Central Africa Latin America
repository_type	Digital Repository
institution_category	Foreign Institution
institution	Digital Repositories
building	World Bank Open Knowledge Repository
collection	World Bank
language	English
topic	INEQUALITY ECONOMIC DEVELOPMENT WAGE LATIN AMERICA ECONOMIC BOOM FIRM HETEROGENEITY EARNINGS INEQUALITY EDUCATION EXPANSION LABOR MARKETS
spellingShingle	INEQUALITY ECONOMIC DEVELOPMENT WAGE LATIN AMERICA ECONOMIC BOOM FIRM HETEROGENEITY EARNINGS INEQUALITY EDUCATION EXPANSION LABOR MARKETS Messina, Julian Silva, Joana Wage Inequality in Latin America : Understanding the Past to Prepare for the Future
geographic_facet	Latin America & Caribbean Caribbean Central Africa Latin America
relation	Latin American Development Forum;
description	What caused the decline in wage inequality of the 2000s in Latin America? Looking to the future, will the current economic slowdown be regressive? Wage Inequality in Latin America: Understanding the Past to Prepare for the Future addresses these two questions by reviewing relevant literature and providing new evidence on what we know from the conceptual, empirical, and policy perspectives. The answer to the first question can be broken down into several parts, although the bottom line is that the changes in wage inequality resulted from a combination of three forces: (a) education expansion and its effect on falling returns to skill (the supply-side story); (b) shifts in aggregate domestic demand; and (c) exchange rate appreciation from the commodity boom and the associated shift to the nontradable sector that changed interfirm wage differences. Other forces had a non-negligible but secondary role in some countries, while they were not present in others. These include the rapid increase of the minimum wage and a rapid trend toward formalization of employment, which played a supporting role but only during the boom. Understanding the forces behind recent trends also helps to shed light on the second question. The analysis in this volume suggests that the economic slowdown is putting the brakes on the reduction of inequality in Latin America and will likely continue to do so—but it might not actually reverse the region’s movement toward less wage inequality.
format	Book
author	Messina, Julian Silva, Joana
author_facet	Messina, Julian Silva, Joana
author_sort	Messina, Julian
title	Wage Inequality in Latin America : Understanding the Past to Prepare for the Future
title_short	Wage Inequality in Latin America : Understanding the Past to Prepare for the Future
title_full	Wage Inequality in Latin America : Understanding the Past to Prepare for the Future
title_fullStr	Wage Inequality in Latin America : Understanding the Past to Prepare for the Future
title_full_unstemmed	Wage Inequality in Latin America : Understanding the Past to Prepare for the Future
title_sort	wage inequality in latin america : understanding the past to prepare for the future
publisher	Washington, DC: World Bank
publishDate	2017
url	http://hdl.handle.net/10986/28682
_version_	1764467531042521088

Wage Inequality in Latin America : Understanding the Past to Prepare for the Future

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