Evolution of earnings and rates of returns to education in Mexico

Gladys Lopez-Acevedo
Authors registered in the RePEc Author Service: Gladys Lopez-Acevedo

No 2691, Policy Research Working Paper Series from The World Bank

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.

Keywords: Environmental Economics&Policies; Poverty Impact Evaluation; Health Economics&Finance; Economic Theory&Research; Labor Policies; Economic Theory&Research; Governance Indicators; Inequality; Poverty Impact Evaluation; Environmental Economics&Policies (search for similar items in EconPapers)
Date: 2001-10-31
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Citations: View citations in EconPapers (4)

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