Inequality in Latin America: determinants and consequences

Humberto Lopez and Guillermo Perry

No 4504, Policy Research Working Paper Series from The World Bank

Abstract: Latin America is together with Sub-Saharan Africa the most unequal region of the world. This paper documents recent inequality trends in the Latin American region, going beyond traditional measures of income inequality. The paper also reviews some of the explanations that have been put forward to understand the current situation, and discusses why reducing income inequality should be an important policy priority. In particular, the authors discuss channels through which inequality can affect growth and output volatility. On the whole, the analysis suggests a two-pronged approach to reduce inequality in the region that combines policies aimed at improving the distribution of assets (especially education) with elements aimed at improving the capacity of the state to redistribute income through taxes and transfers.

Keywords: Inequality; Rural Poverty Reduction; Economic Conditions and Volatility; Achieving Shared Growth; Poverty Impact Evaluation (search for similar items in EconPapers)
Date: 2008-02-01
New Economics Papers: this item is included in nep-dev and nep-lam
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Citations: View citations in EconPapers (26)

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Persistent link: https://EconPapers.repec.org/RePEc:wbk:wbrwps:4504

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