Publication:
Earnings Inequality Within and Across Gender, Racial, and Ethnic Groups in Four Latin American Countries

Loading...
Thumbnail Image
Files in English
English PDF (526.52 KB)
813 downloads
English Text (173.98 KB)
147 downloads
Date
2008-04
ISSN
Published
2008-04
Author(s)
Jacobsen, Joyce P.
Editor(s)
Abstract
Latin American countries are generally characterized as displaying high income and earnings inequality overall along with high inequality by gender, race, and ethnicity. However, the latter phenomenon is not a major contributor to the former phenomenon. Using household survey data from four Latin American countries (Bolivia, Brazil, Guatemala, and Guyana) for which stratification by race or ethnicity is possible, this paper demonstrates (using Theil index decompositions as well as Gini indices, and 90/10 and 50/10 percentile comparisons) that within-group earnings inequality rather than between-group earnings inequality is the main contributor to overall earnings inequality. Simulations in which the relatively disadvantaged gender and/or racial/ethnic group is treated as if it were the relatively advantaged group tend to reduce overall earnings inequality measures only slightly and in some cases have the effect of increasing earnings inequality measures.
Link to Data Set
Citation
Jacobsen, Joyce P.; Cunningham, Wendy. 2008. Earnings Inequality Within and Across Gender, Racial, and Ethnic Groups in Four Latin American Countries. Policy Research Working Paper No. 4591. © World Bank. http://hdl.handle.net/10986/6724 License: CC BY 3.0 IGO.
Associated URLs
Associated content
Report Series
Report Series
Other publications in this report series
  • Publication
    Geopolitics and the World Trading System
    (Washington, DC: World Bank, 2024-12-23) Mattoo, Aaditya; Ruta, Michele; Staiger, Robert W.
    Until the beginning of this century, the GATT/WTO system worked. Economic research provided a compelling explanation. It showed that if governments maximize the well-being of their own countries broadly defined, GATT/WTO principles would facilitate mutually beneficial cooperation over their trade policy choices. Now heightened geopolitical rivalry seems to have undermined the WTO. A simple transposition of the previous rationalization suggests that geopolitics and trade cooperation are not compatible. The paper shows that this is only true if rivalry eclipses any consideration of own-country well-being. In all other circumstances, there are gains from trade cooperation even with geopolitics. Furthermore, the WTO’s relevance is in question only if it adheres too rigidly to its existing rules and norms. Through measured adaptation to the geopolitical imperative, the WTO can continue to thrive as a forum for multilateral trade cooperation in the age of geopolitics.
  • Publication
    The Macroeconomic Implications of Climate Change Impacts and Adaptation Options
    (Washington, DC: World Bank, 2025-05-29) Abalo, Kodzovi; Boehlert, Brent; Bui, Thanh; Burns, Andrew; Castillo, Diego; Chewpreecha, Unnada; Haider, Alexander; Hallegatte, Stephane; Jooste, Charl; McIsaac, Florent; Ruberl, Heather; Smet, Kim; Strzepek, Ken
    Estimating the macroeconomic implications of climate change impacts and adaptation options is a topic of intense research. This paper presents a framework in the World Bank's macrostructural model to assess climate-related damages. This approach has been used in many Country Climate and Development Reports, a World Bank diagnostic that identifies priorities to ensure continued development in spite of climate change and climate policy objectives. The methodology captures a set of impact channels through which climate change affects the economy by (1) connecting a set of biophysical models to the macroeconomic model and (2) exploring a set of development and climate scenarios. The paper summarizes the results for five countries, highlighting the sources and magnitudes of their vulnerability --- with estimated gross domestic product losses in 2050 exceeding 10 percent of gross domestic product in some countries and scenarios, although only a small set of impact channels is included. The paper also presents estimates of the macroeconomic gains from sector-level adaptation interventions, considering their upfront costs and avoided climate impacts and finding significant net gross domestic product gains from adaptation opportunities identified in the Country Climate and Development Reports. Finally, the paper discusses the limits of current modeling approaches, and their complementarity with empirical approaches based on historical data series. The integrated modeling approach proposed in this paper can inform policymakers as they make proactive decisions on climate change adaptation and resilience.
  • Publication
    Global Poverty Revisited Using 2021 PPPs and New Data on Consumption
    (Washington, DC: World Bank, 2025-06-05) Foster, Elizabeth; Jolliffe, Dean Mitchell; Ibarra, Gabriel Lara; Lakner, Christoph; Tettah-Baah, Samuel
    Recent improvements in survey methodologies have increased measured consumption in many low- and lower-middle-income countries that now collect a more comprehensive measure of household consumption. Faced with such methodological changes, countries have frequently revised upward their national poverty lines to make them appropriate for the new measures of consumption. This in turn affects the World Bank’s global poverty lines when they are periodically revised. The international poverty line, which is based on the typical poverty line in low-income countries, increases by around 40 percent to $3.00 when the more recent national poverty lines as well as the 2021 purchasing power parities are incorporated. The net impact of the changes in international prices, the poverty line, and new survey data (including new data for India) is an increase in global extreme poverty by some 125 million people in 2022, and a significant shift of poverty away from South Asia and toward Sub-Saharan Africa. The changes at higher poverty lines, which are more relevant to middle-income countries, are mixed.
  • Publication
    From Patriarchy to Policy
    (Washington, DC: World Bank, 2025-05-29) Bussolo, Maurizio; Rexer, Jonah M.; Hu, Lynn
    Legal institutions play an important role in shaping gender equality in economic domains, from inheritance to labor markets. But where do gender equal laws come from? Using cross-country data on social norms and legal equality, this paper investigates the socio-cultural roots of gender inequity in the legal system and its implications for female labor force participation. To identify the impact of social norms, the analysis uses an empirical strategy that exploits pre-modern differences in ancestral patriarchal culture as an instrument for present-day gender norms. The findings show that ancestral patriarchal culture is a strong predictor of contemporary norms, and conservative social norms are associated with more gender inequality in the de jure legal framework, the de facto implementation of laws, and the labor market. The paper presents evidence for a political selection mechanism linking norms to laws: countries with more conservative norms elect political leaders who are more hostile to gender equality, who then pass less progressive legislation. The results highlight the cultural roots and political drivers of legalized gender inequality.
  • Publication
    Global Socio-economic Resilience to Natural Disasters
    (Washington, DC: World Bank, 2025-05-22) Middelanis, Robin; Jafino, Bramka Arga; Hill, Ruth; Nguyen, Minh Cong; Hallegatte, Stephane
    Most disaster risk assessments use damages to physical assets as their central metric, often neglecting distributional impacts and the coping and recovery capacity of affected people. To address this shortcoming, the concepts of well-being losses and socio-economic resilience—the ability to experience asset losses without a decline in well-being—have been proposed. This paper uses microsimulations to produce a global estimate of well-being losses from, and socio-economic resilience to, natural disasters, covering 132 countries. On average, each $1 in disaster-related asset losses results in well-being losses equivalent to a $2 uniform national drop in consumption, with significant variation within and across countries. The poorest income quintile within each country incurs only 9% of national asset losses but accounts for 33% of well-being losses. Compared to high-income countries, low-income countries experience 67% greater well-being losses per dollar of asset losses and require 56% more time to recover. Socio-economic resilience is uncorrelated with exposure or vulnerability to natural hazards. However, a 10 percent increase in GDP per capita is associated with a 0.9 percentage point gain in resilience, but this benefit arises indirectly—such as through higher rate of formal employment, better financial inclusion, and broader social protection coverage—rather than from higher income itself. This paper assess ten policy options and finds that socio-economic and financial interventions (such as insurance and social protection) can effectively complement asset-focused measures (e.g., construction standards) and that interventions targeting low-income populations usually have higher returns in terms of avoided well-being losses per dollar invested.
Journal
Journal Volume
Journal Issue

Related items

Showing items related by metadata.

  • Publication
    Declining Inequality in Latin America in the 2000s : The Cases of Argentina, Brazil, and Mexico
    (World Bank, Washington, DC, 2012-10) Ortiz-Juarez, Eduardo; Lustig, Nora; Lopez-Calva, Luis F.
    Between 2000 and 2010, the Gini coefficient declined in 13 of 17 Latin American countries. The decline was statistically significant and robust to changes in the time interval, inequality measures, and data sources. In-depth country studies for Argentina, Brazil, and Mexico suggest two main phenomena underlie this trend: a fall in the premium to skilled labor and more progressive government transfers. The fall in the premium to skills resulted from a combination of supply, demand, and institutional factors. Their relative importance depends on the country.
  • Publication
    Measuring Inequality of Opportunities in Latin America and the Caribbean
    (Washington, DC: World Bank, 2009) Paes de Barros, Ricardo; Ferreira, Francisco H.G.; Molinas Vega, Jose R.; Saavedra Chanduvi, Jaime
    Over the past decade, faster growth and smarter social policy have reversed the trend in Latin America's poverty. Too slowly and insufficiently, but undeniably, the percentage of Latinos who are poor has at long last begun to fall. This has shifted the political and policy debates from poverty toward inequality, something to be expected in a region that exhibits the world's most regressive distribution of development outcomes such as income, land ownership, and educational achievement. This book is a breakthrough in the measurement of human opportunity. It builds sophisticated formulas to answer a rather simple question: how much influence do personal circumstances have on the access that children get to the basic services that are necessary for a productive life? Needless to say, producing a methodology to measure human opportunity, and applying it across countries in one region, is just a first step. On the one hand, technical discussions and scientific vetting will continue, and refinements will surely follow. On the other, applying the new tool to a single country will allow for adjustments that make the findings much more useful to its policy realities. And fascinating comparative lessons could be learned by measuring human opportunity in developed countries across, say, the states of the United States or the nations of Europe. But the main message this book delivers remains a powerful one: it is possible to make equity a central purpose, if not the very definition, of development. That is, perhaps, it's most important contribution.
  • Publication
    Inequality of Economic Opportunity in Turkey
    (World Bank, Ankara, 2010-03) Gignoux, Jérémie; Ferreira, Francisco H. G.; Aran, Meltem
    Using information on asset ownership, housing quality, and access to services to construct an indicator of household wealth, the author estimates the share of inequality among prime-age Turkish women that can be attributed to unequal opportunities. Both parametric and non-parametric estimation methods are used, and robustness to some sample redefinitions is verified. The author find that at least one-third (one-fourth) of overall wealth (imputed consumption) inequality in Turkey is associated with morally irrelevant, pre-determined circumstances. The circumstances that account for the largest share of the variance are rural or urban birth area and father's education. Controlling for rural birth, parents' education, language spoken at home, and number of siblings, a three-way regional breakdown of birthplace is not an important predictor of wealth. An opportunity deprivation profile reveals that more than two thirds of the most deprived group in Turkey consists of women born in the rural areas of the Eastern region, from mothers with no formal education.
  • Publication
    Measuring Inequality of Opportunity with Imperfect Data : The Case of Turkey
    (World Bank, Washington, DC, 2010-02) Gignoux, Jeremie; Ferreira, Francisco H.G.; Aran, Meltem
    The measurement of inequality of opportunity has hitherto not been attempted in a number of countries because of data limitations. This paper proposes two alternative approaches to circumventing the missing data problems in countries where a demographic and health survey and an ancillary household expenditure survey are available. One method relies only on the demographic and health survey, and constructs a wealth index as a measure of economic advantage. The alternative method imputes consumption from the ancillary survey into the demographic and health survey. In both cases, the between-type share of overall inequality is computed as a lower bound estimator of inequality of opportunity. Parametric and non-parametric estimates are calculated for both methods, and the parametric approach is shown to yield preferable lower-bound measures. In an application to the sample of ever-married women aged 30-49 in Turkey, inequality of opportunity accounts for at least 26 percent (31 percent) of overall inequality in imputed consumption (the wealth index).
  • Publication
    Breaking Out of Inequality Traps : Political Economy Considerations
    (World Bank, Washington, DC, 2008-10) Fritz, Verena; Katayama, Roy; Simler, Kenneth
    This note is based on presentations and comments by Francois Bourguignon, Frances Stewart, Leonard Wantchekon, and Nancy Birdsall (chair) at the 2008 PREM Conference session on political economy of inequality: implications for inclusive growth and focuses on actions that the World Bank may pursue to promote more inclusive growth.

Users also downloaded

Showing related downloaded files

  • Publication
    Government Matters III : Governance Indicators for 1996-2002
    (World Bank, Washington, DC, 2003-08) Kaufmann, Daniel; Kraay, Aart; Mastruzzi, Massimo
    The authors present estimates of six dimensions of governance covering 199 countries and territories for four time periods: 1996, 1998, 2000, and 2002. These indicators are based on several hundred individual variables measuring perceptions of governance, drawn from 25 separate data sources constructed by 18 different organizations. The authors assign these individual measures of governance to categories capturing key dimensions of governance and use an unobserved components model to construct six aggregate governance indicators in each of the four periods. They present the point estimates of the dimensions of governance as well as the margins of errors for each country for the four periods. The governance indicators reported here are an update and expansion of previous research work on indicators initiated in 1998 (Kaufmann, Kraay, and Zoido-Lobat 1999a,b and 2002). The authors also address various methodological issues, including the interpretation and use of the data given the estimated margins of errors.
  • Publication
    Governance Matters IV : Governance Indicators for 1996-2004
    (World Bank, Washington, DC, 2005-06) Kaufmann, Daniel; Kraay, Aart; Mastruzzi, Massimo
    The authors present the latest update of their aggregate governance indicators, together with new analysis of several issues related to the use of these measures. The governance indicators measure the following six dimensions of governance: (1) voice and accountability; (2) political instability and violence; (3) government effectiveness; (4) regulatory quality; (5) rule of law, and (6) control of corruption. They cover 209 countries and territories for 1996, 1998, 2000, 2002, and 2004. They are based on several hundred individual variables measuring perceptions of governance, drawn from 37 separate data sources constructed by 31 organizations. The authors present estimates of the six dimensions of governance for each period, as well as margins of error capturing the range of likely values for each country. These margins of error are not unique to perceptions-based measures of governance, but are an important feature of all efforts to measure governance, including objective indicators. In fact, the authors give examples of how individual objective measures provide an incomplete picture of even the quite particular dimensions of governance that they are intended to measure. The authors also analyze in detail changes over time in their estimates of governance; provide a framework for assessing the statistical significance of changes in governance; and suggest a simple rule of thumb for identifying statistically significant changes in country governance over time. The ability to identify significant changes in governance over time is much higher for aggregate indicators than for any individual indicator. While the authors find that the quality of governance in a number of countries has changed significantly (in both directions), they also provide evidence suggesting that there are no trends, for better or worse, in global averages of governance. Finally, they interpret the strong observed correlation between income and governance, and argue against recent efforts to apply a discount to governance performance in low-income countries.
  • Publication
    Design Thinking for Social Innovation
    (2010-07) Brown, Tim; Wyatt, Jocelyn
    Designers have traditionally focused on enchancing the look and functionality of products.
  • Publication
    Measuring Financial Inclusion : The Global Findex Database
    (World Bank, Washington, DC, 2012-04) Demirguc-Kunt, Asli; Klapper, Leora
    This paper provides the first analysis of the Global Financial Inclusion (Global Findex) Database, a new set of indicators that measure how adults in 148 economies save, borrow, make payments, and manage risk. The data show that 50 percent of adults worldwide have an account at a formal financial institution, though account penetration varies widely across regions, income groups and individual characteristics. In addition, 22 percent of adults report having saved at a formal financial institution in the past 12 months, and 9 percent report having taken out a new loan from a bank, credit union or microfinance institution in the past year. Although half of adults around the world remain unbanked, at least 35 percent of them report barriers to account use that might be addressed by public policy. Among the most commonly reported barriers are high cost, physical distance, and lack of proper documentation, though there are significant differences across regions and individual characteristics.
  • Publication
    Governance Matters VIII : Aggregate and Individual Governance Indicators 1996–2008
    (2009-06-01) Kaufmann, Daniel; Kraay, Aart; Mastruzzi, Massimo
    This paper reports on the 2009 update of the Worldwide Governance Indicators (WGI) research project, covering 212 countries and territories and measuring six dimensions of governance between 1996 and 2008: Voice and Accountability, Political Stability and Absence of Violence/Terrorism, Government Effectiveness, Regulatory Quality, Rule of Law, and Control of Corruption. These aggregate indicators are based on hundreds of specific and disaggregated individual variables measuring various dimensions of governance, taken from 35 data sources provided by 33 different organizations. The data reflect the views on governance of public sector, private sector and NGO experts, as well as thousands of citizen and firm survey respondents worldwide. The authors also explicitly report the margins of error accompanying each country estimate. These reflect the inherent difficulties in measuring governance using any kind of data. They find that even after taking margins of error into account, the WGI permit meaningful cross-country comparisons as well as monitoring progress over time. The aggregate indicators, together with the disaggregated underlying indicators, are available at www.govindicators.org.