1990–2010
Elissa Braunstein and Stephanie Seguino
Keywords: Latin America; gender; labor markets; minimum wage; government spending
Published in print:Jul 2018
Elissa Braunstein and Stephanie Seguino
Keywords: Latin America; gender; labor markets; minimum wage; government spending
Published in print:Jul 2018
Category:Research Article
Pages:307–332
Download PDF (279.4 KB)
Latin America experienced a decline in household income inequality in the 2000s, in sharp contrast to growing inequality in other regions of the world. This has been attributed to macroeconomic policy, social spending, and increased returns to education. This paper explores this issue from a gender perspective by econometrically evaluating how changes in economic structure and policy have impacted gendered employment and unemployment rates, as well as gender inequality in these variables, using country-level panel data for a set of 18 Latin American countries between 1990 and 2010. Three variables stand out as having consistent gender-equalizing effects in the labor market: social spending, minimum wages, and public investment. Less important or consistent were the effects of external factors (such as terms of trade), economic structure, and GDP growth.
Full Text
1 INTRODUCTION
After about a decade of relatively strong economic growth, most Latin American economies are struggling to emerge from the global growth slowdown, evident since 2009, and the ripple effects of the end of the commodity price boom. From a human development perspective, this is a particularly troubling turn of economic fortunes because the boom of the early and mid 2000s, a real departure from the crises of the 1980s and the doldrums of the 1990s, was accompanied by significant declines in household income inequality across the region. This was especially noteworthy, occurring in a region that has historically been among the world's most unequal and at a time when inequality was widening globally. Though the growth slowdown in 2009 has not yet reversed the declining inequality trend of the 2000s, it may be too soon to tell if that declining trend is structural or cyclical. It is thus all the more important to understand its causes, and whether and how more challenging economic conditions may subvert the social and economic progress achieved over the last decade. 1 A number of scholars have taken up this question, focusing on both the political (the rise of left-of-center governments) and the economic (macroeconomic and social policies) as casual factors, and relying primarily on the net household Gini coefficient (post-tax and -transfer) to measure inequality (Cornia 2014; Lopez-Calva and Lustig 2010; Tsounta and Osueke 2014).
A related but as yet unevaluated question is whether gender inequality also declined in the 2000s and if so, whether the economic determinants are similar to those identified in the empirical literature on household inequality. Considering gender inequality separately from income inequality is important because income is not always equitably shared at the household level. Research on intrahousehold resource distribution identifies distinct gender differences in access to and control over resources, indicative of non-pooling of income. Gender equality is also an important development goal in itself, not least because of the association between a number of gender equality measures (for example, health, education, and employment) and higher rates of economic growth. Time series data on the gender distribution of income at the household level do not exist, so in this paper we focus on differences in economic opportunity as reflected in employment and unemployment rates. These measures of economic opportunity are important because earning an income through employment is a crucial vector for women's economic empowerment, one that has lagged behind the substantial achievements in gender equality in health and education throughout the region. Moreover, our focus on gender-specific labor market outcomes indicates whether and how changes in economic policy and structure affect more than household income, and whether these changes contribute to creating the conditions for sustainable and transformative improvements in well-being and gender equality. Taking as a guide the empirical literature exploring income inequality trends in Latin America, we econometrically evaluate how changes in economic policy and structure have impacted gendered employment and unemployment rates, using country-level panel data for a set of 18 Latin American countries between 1990 and 2010.
Download PDF (279.4 KB)
Latin America experienced a decline in household income inequality in the 2000s, in sharp contrast to growing inequality in other regions of the world. This has been attributed to macroeconomic policy, social spending, and increased returns to education. This paper explores this issue from a gender perspective by econometrically evaluating how changes in economic structure and policy have impacted gendered employment and unemployment rates, as well as gender inequality in these variables, using country-level panel data for a set of 18 Latin American countries between 1990 and 2010. Three variables stand out as having consistent gender-equalizing effects in the labor market: social spending, minimum wages, and public investment. Less important or consistent were the effects of external factors (such as terms of trade), economic structure, and GDP growth.
Full Text
1 INTRODUCTION
After about a decade of relatively strong economic growth, most Latin American economies are struggling to emerge from the global growth slowdown, evident since 2009, and the ripple effects of the end of the commodity price boom. From a human development perspective, this is a particularly troubling turn of economic fortunes because the boom of the early and mid 2000s, a real departure from the crises of the 1980s and the doldrums of the 1990s, was accompanied by significant declines in household income inequality across the region. This was especially noteworthy, occurring in a region that has historically been among the world's most unequal and at a time when inequality was widening globally. Though the growth slowdown in 2009 has not yet reversed the declining inequality trend of the 2000s, it may be too soon to tell if that declining trend is structural or cyclical. It is thus all the more important to understand its causes, and whether and how more challenging economic conditions may subvert the social and economic progress achieved over the last decade. 1 A number of scholars have taken up this question, focusing on both the political (the rise of left-of-center governments) and the economic (macroeconomic and social policies) as casual factors, and relying primarily on the net household Gini coefficient (post-tax and -transfer) to measure inequality (Cornia 2014; Lopez-Calva and Lustig 2010; Tsounta and Osueke 2014).
A related but as yet unevaluated question is whether gender inequality also declined in the 2000s and if so, whether the economic determinants are similar to those identified in the empirical literature on household inequality. Considering gender inequality separately from income inequality is important because income is not always equitably shared at the household level. Research on intrahousehold resource distribution identifies distinct gender differences in access to and control over resources, indicative of non-pooling of income. Gender equality is also an important development goal in itself, not least because of the association between a number of gender equality measures (for example, health, education, and employment) and higher rates of economic growth. Time series data on the gender distribution of income at the household level do not exist, so in this paper we focus on differences in economic opportunity as reflected in employment and unemployment rates. These measures of economic opportunity are important because earning an income through employment is a crucial vector for women's economic empowerment, one that has lagged behind the substantial achievements in gender equality in health and education throughout the region. Moreover, our focus on gender-specific labor market outcomes indicates whether and how changes in economic policy and structure affect more than household income, and whether these changes contribute to creating the conditions for sustainable and transformative improvements in well-being and gender equality. Taking as a guide the empirical literature exploring income inequality trends in Latin America, we econometrically evaluate how changes in economic policy and structure have impacted gendered employment and unemployment rates, using country-level panel data for a set of 18 Latin American countries between 1990 and 2010.
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