Income polarisation: an exploratory analysis for Latin America

Abstract

This document presents a set of statistics that characterise the degree of income polarisation in Latin American and the Caribbean (LAC). The study is based on a dataset of household surveys from 21 LAC countries in the period 1989-2004. Latin America is characterised by a high level of income polarisation. On average, income polarisation has mildly increased in the region since the early 1990s. The paper suggests that institutions and conflict interact in different ways with the various characteristics of the income distribution. In particular, countries with high income polarisation and inequality are more likely to have high levels of conflict and corruption.