Inequality in Latin America: Determinants and Consequences

41 Pages Posted: 20 Apr 2016

See all articles by Humberto Lopez

Humberto Lopez

World Bank - Research Department

Guillermo E. Perry

World Bank - Latin America and Caribbean Region

Date Written: February 1, 2008

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

Suggested Citation

Lopez, Humberto and Perry, Guillermo E., Inequality in Latin America: Determinants and Consequences (February 1, 2008). World Bank Policy Research Working Paper Series, Vol. , pp. -, 2008. Available at SSRN: https://ssrn.com/abstract=1090391

Humberto Lopez

World Bank - Research Department ( email )

1818 H Street, N.W.
Washington, DC 20433
United States

Guillermo E. Perry

World Bank - Latin America and Caribbean Region ( email )

1818 H Street NW
Washington, DC 20433
United States

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