Income distribution in Latin America: the evolution in the last 20 years

Abstract

While Latin America has historically been considered a region of very high inequality, the performance of most Latin American countries in terms of reduction of income inequality has been remarkable good in the first decade of this century. Given that those improvements took place in a context of rising inequality in most of the world, the evolution of income inequality in the region has caught the attention of researchers and policy makers around the world. Taking advantage of a large database of comparable microdata from household surveys, this article updates the evidence on the trends of income inequality in all Latin American countries for the period 1992-2015. It also provides an analysis of how the distinctive evolution of income inequality in this century in Latin America has changed the position of the different countries of the region in both, the global distribution of income in the world and the global distribution of income in Latin America. Finally, the paper decomposes the evolution of income inequality in several countries of the region, discussing the role played by several factors on that evolution.