Financial Development and the Distribution of Income in Latin America and the Caribbean
Gustavo J. Canavire Bacarreza () and
Additional contact information
Gustavo J. Canavire Bacarreza: World Bank
Authors registered in the RePEc Author Service: Gustavo Javier Canavire-Bacarreza ()
No 3796, IZA Discussion Papers from Institute of Labor Economics (IZA)
One of the central concerns in Latin America and the Caribbean (LAC) has been the reduction of poverty and inequality so prevalent in the continent. Using large world samples, the literature has found that financial development increases economic growth, increases the income of the poor, and reduces inequality. This paper studies the effects of financial development on the whole distribution of income in LAC. We find that the income of the poorest quintile has not been affected by expansion in the financial system. However, we do find that financial development has had a disproportionate positive effect on the incomes of the second, third and fourth quintiles. We also find some evidence for the Greenwood-Jovanovic (1991) hypothesis that this positive effect only begins after a country crosses a certain economic development threshold.
Keywords: financial development; distribution of income; inequality (search for similar items in EconPapers)
JEL-codes: G00 O11 O16 (search for similar items in EconPapers)
Pages: 20 pages
New Economics Papers: this item is included in nep-dev and nep-lam
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (10) Track citations by RSS feed
Published - published in: Well-Being and Social Policy, 2009, 5 (1), 1-18
Downloads: (external link)
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: https://EconPapers.repec.org/RePEc:iza:izadps:dp3796
Ordering information: This working paper can be ordered from
IZA, Margard Ody, P.O. Box 7240, D-53072 Bonn, Germany
Access Statistics for this paper
More papers in IZA Discussion Papers from Institute of Labor Economics (IZA) IZA, P.O. Box 7240, D-53072 Bonn, Germany. Contact information at EDIRC.
Bibliographic data for series maintained by Holger Hinte ().