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on Central and South America |
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Issue of 2011‒09‒22
seven papers chosen by |
| By: | Fernando Borraz (Banco Central del Uruguay y Departamento de Economía, Facultad de Ciencias Sociales, Universidad de la República); Nicolás Gonzalez Pampillón (Universidad de Montevideo); Máximo Rossi (Departamento de Economía, Facultad de Ciencias Sociales, Universidad de la República) |
| Abstract: | There is an increasing literature that discusses how to measure the middle class. Some approaches are based on an arbitrary deÖnition such as income quartiles or the poverty line. Recently, Foster and Wolfson developed a methodology which lacks of arbitrariness that enables us to compare the middle class of two di§erent income distributions. We apply this new tool jointly with a complementary method ñrelative distribution approach- to household income data in 1994-2004 and 2004-2010, to analyze the evolution of the middle class and polarization in Uruguay. During the Örst period, which is characterized by an increasing income inequality, we Önd that the middle class declined and income polarization increased. In the second one, where the Uruguayan economy experienced a recovery from the downturn su§ered in 2002, we Önd that the middle class rose and polarization decreased. However, this last result is attenuated when we do not consider the household income imputation because of the new health system implemented in 2008. |
| Keywords: | income polarization, middle class, inequality, social policies, bipolarization |
| JEL: | D3 D6 I3 |
| Date: | 2011–08 |
| URL: | http://d.repec.org/n?u=RePEc:ude:wpaper:2011&r=lam |
| By: | Andrea Doneschi (Departamento de Economía, Facultad de Ciencias Sociales, Universidad de la República); Rossana Patron (Departamento de Economía, Facultad de Ciencias Sociales, Universidad de la República) |
| Abstract: | The figures show that in Uruguay there are not significant changes in the composition of employment by qualifications during the last decade, being the majority group those of medium skilled workers. Even when in the period there was a significant increment in employment, it was not exempt of significant fluctuations which affected differently qualification groups and activity sectors. From these data some long term policy recommendations arise, as courter cyclical policies for skill formation as well as a careful consideration of promoting sector-specific-skills for riskier sectors. |
| Keywords: | skills, employment, economic cycle |
| JEL: | J21 |
| Date: | 2011–08 |
| URL: | http://d.repec.org/n?u=RePEc:ude:wpaper:1411&r=lam |
| By: | Fernando Borraz (Banco Central del Uruguay y Departamento de Economía, Facultad de Ciencias Sociales, Universidad de la República); Alejandro Fried (Banco Central del Uruguay); Diego Gianelli (Banco Central del Uruguay y Departamento de Economía, Facultad de Ciencias Sociales, Universidad de la República) |
| Abstract: | Analizamos las calificaciones de deuda soberana a partir de modelos logit para una muestra de 53 países entre 2000 y 2010. Dado que la literatura sobre el tema omite un tratamiento diferencial para variables explicativas no estacionarias incorporamos un factor de tendencia que interactúa con el nivel de actividad para balancear las ecuaciones. Concluimos que las calificaciones de deuda soberana dependen de un conjunto de variables macroeconómicas e institucionales y que Uruguay al cierre del 2010 contaba con meritos suficientes para acceder al Grado Inversor. Sin perjuicio de ello, el alto nivel de dolarización interactuaría con los restantes fundamentos generándole a su calificación una alta volatilidad cíclica. |
| Keywords: | sovereign debt, sovereign credit ratings, investment grade, credit ratings agencies |
| JEL: | E44 F37 G15 |
| Date: | 2011–08 |
| URL: | http://d.repec.org/n?u=RePEc:ude:wpaper:2111&r=lam |
| By: | Fernando Borraz (Banco Central del Uruguay y Departamento de Economía, Facultad de Ciencias Sociales, Universidad de la República); Nicolás Gonzalez Pampillón (Universidad de Montevideo); Marcelo Olarreaga (University of Geneva and CEPR) |
| Abstract: | In the case of natural monopolies there tends to be a trade-off between a higher quality of output provided by private firms, and a better access for poor consumers provided by public firms. This is partly the reflection of differences in objectives by private and public firms. The former tend to be product-driven, whereas the latter tend to base decisions on political agendas (Chong and Lopez de Silanes, 2005). The objective of this paper is to explore the impact on network access, water quality, and health outcomes of Uruguay's nationalization of water services. An important advantage of focusing on nationalization rather than privatization is that it avoids selection bias due to cherry-picking by firms or governments at the time of privatization. Indeed, nationalization in Uruguay affected all previously privatized firms, as water was declared "part of the public domain". Results suggest that the change in ownership led to an increase in the sanitation rate, as well as improvements in water quality. It was also accompanied by a decline in water-related child mortality, although this latter effect tends not to be statistically significant across specifications. |
| Keywords: | minimum wage, wage inequality, IV, semiparametric estimation |
| JEL: | D60 H51 I10 I30 L33 O12 |
| Date: | 2011–08 |
| URL: | http://d.repec.org/n?u=RePEc:ude:wpaper:1811&r=lam |
| By: | Fernando Borraz (Banco Central del Uruguay y Departamento de Economía, Facultad de Ciencias Sociales, Universidad de la República); Nicolás Gonzalez Pampillón (Universidad de Montevideo) |
| Abstract: | This paper analyzes the role of the sharply increases in the minimum wage after 2004 in Uruguay in the slight decrease on wage inequality. We Önd no impact of the miminum wage increases on wage inequality. This results can be explained by the low starting level of the minimum wage or lack of compliance with it. The Uruguayan experience shows that the minimum wage is not always e§ective as a redistribution instrument. |
| Keywords: | minimum wage, wage inequality, IV, semiparametric estimation |
| JEL: | J20 J31 J38 |
| Date: | 2011–08 |
| URL: | http://d.repec.org/n?u=RePEc:ude:wpaper:1711&r=lam |
| By: | Alvaro Forteza (Departamento de Economía, Facultad de Ciencias Sociales, Universidad de la República) |
| Abstract: | This paper summarizes the main findings in a series of coordinated studies conducted to assess the impact of social security programs on the distribution of lifetime labor income in Argentina, Brazil, Chile, Mexico and Uruguay. The country-case studies find varying degrees of redistribution, with PAYG-DB and mixed programs redistributing more than individual savings accounts programs. Notwithstanding, it is the Chilean individual savings accounts program, combined with the recently reformed solidarity pillar, the one that contributes more to reducing inequality in this group of countries. |
| Keywords: | Redistribution, Social Security |
| JEL: | H55 J14 J2 |
| Date: | 2011–08 |
| URL: | http://d.repec.org/n?u=RePEc:ude:wpaper:1311&r=lam |
| By: | Alvaro Forteza (Departamento de Economía, Facultad de Ciencias Sociales, Universidad de la República); Irene Mussio (Departamento de Economía, Facultad de Ciencias Sociales, Universidad de la República) |
| Abstract: | We assess redistribution in the Uruguayan main pension and unemployment insurance programs on a lifetime basis. Using administrative records from social security, we simulate lifetime declared labor income and flows of contributions and benefits of affiliates to the programs. Expected present values of income and net flows are also computed. Equipped with these estimations we construct standard measures of distribution and redistribution of lifetime labor income through the social security system. Our findings suggest that these programs reduce income inequality. In particular, social Security reduces the Gini coefficient of expected lifetime formal labor income by almost 2 percentage points. |
| Keywords: | Redistribution; Social Security; Uruguay |
| JEL: | H55 J14 J2 |
| Date: | 2011–08 |
| URL: | http://d.repec.org/n?u=RePEc:ude:wpaper:1211&r=lam |