New Economics Papers
on Central and South America
Issue of 2012‒03‒28
eleven papers chosen by

  1. Inequality in Education: Evidence for Latin America By Cruces, Guillermo; Gasparini, Leonardo
  2. Uruguayâ..s Income Inequality and Political Regimes during 1981â..2010 By Amarante, Veronica; Vigorito, Andrea
  3. Do Cash Transfers Improve Birth Outcomes? Evidence from Matched Vital Statistics, Social Security and Program Data By Amarante, Veronica; Manacorda, Marco; Miguel, Edward; Vigorito, Andrea
  4. On the Distributional Implications of Social Protection Reforms in Latin America By Barrientos, Armando
  5. La desigualdad del ingreso en Uruguay entre 1986 y 2009. By Guillermo Alves; Verónica Amarante; Gonzalo Salas; Andrea Vigorito
  6. EDUCATION AND LABOUR MARKET OUTCOMES: EVIDENCE FROM BRAZIL By Geraint Johnes; R Freguglia; G Spricigo; A Aggarwal
  7. Innovative Features in Conditional Cash Transfers: An impact evaluation of Chile Solidario on households and children By Bruno Martorano; Marco Sanfilippo; UNICEF Innocenti Research Centre
  8. Innovation Strategies and Employment in Latin American Firms By Gustavo Crespi; Pluvia Zuñiga
  9. El mercado laboral uruguayo en la última década By Ivone Perazzo
  10. Pobreza en la adolescencia en áreas rurales y urbanas en Uruguay By Guillermo Alves; Mariana Zerpa
  11. The Dynamics of Land Titling Regularization and Market Development By Galiani, Sebastian

  1. By: Cruces, Guillermo; Gasparini, Leonardo
    Abstract: This paper provides original empirical evidence on the evolution of education inequality for the Latin American countries over the decades of 1990 and 2000. The analysis covers a wide range of issues on the differences in educational outcomes and opportunities across the population, including inequality in years of education, gaps in school enrolment, wage skill differentials and public social expenditure. The evidence indicates a significant difference between the 1990s and the 2000s in terms of both the assessment of the equity of the education expansion and its impact on the income distribution. In particular, changes in the 2000s seem to have had an equalizing impact on earnings, given the more pro-poor pattern of the education upgrading and a more stable or even increasing relative demand for low-skill labour.
    Keywords: education, inequality, enrolment, wage premium, Latin America
    Date: 2011
  2. By: Amarante, Veronica; Vigorito, Andrea
    Abstract: This study assesses the evolution of inequality in Uruguay during 1981-2010, considered as subperiods built on the basis of the main policy regimes observed: extreme right (1981-84), centre-right (1985-89), right (1990-2004), and centre-left (2005-10). Income inequality diminished during the restoration of democracy, but started to grow steadily in the mid-1990s and despite recent redistributive reforms, continued to grow, albeit modestly, until 2007. In 2008 inequality lessened, continuing this trend through 2009 and 2010.Trade liberalization, suppression of centralized wage-setting mechanisms, the drop in minimum wages and the lack of a social protection system oriented to the most deprived households explain the rise in inequality during the last decade. In a context of a stable macroeconomic system, the recent fall in inequality resulted from a reduction in labour income inequality and the introduction of noncontributory public transfers schemes.
    Keywords: inequality, Uruguay, transfers, wage-setting mechanisms, returns to education, political regimes
    Date: 2011
  3. By: Amarante, Veronica; Manacorda, Marco; Miguel, Edward; Vigorito, Andrea
    Abstract: There is limited empirical evidence on whether unrestricted cash social assistance to poor pregnant women improves children’s birth outcomes. Using program administrative micro-data matched to longitudinal vital statistics on the universe of births in Uruguay, we estimate that participation in a generous cash transfer program led to a sizeable 15% reduction in the incidence of low birthweight. Improvements in mother nutrition and a fall in labor supply, out-of-wedlock births and mother’s smoking all appear to contribute to the effect. We conclude that, by improving child health, unrestricted unconditional cash transfers may help break the cycle of intergenerational poverty.
    Keywords: birth outcomes; welfare transfers
    JEL: I38 J13 J88
    Date: 2012–01
  4. By: Barrientos, Armando
    Abstract: The paper tracks recent changes in the components of social protection in Latin America, the reforms to social insurance in the 1990s and the growth of social assistance in the 2000s, and assesses their effects on poverty and inequality and implications for welfare institutions in the region. The analysis focuses on public subsidies to social protection and their rebalancing. The paper concludes that the expansion of social assistance in the region will result in social protection institutions which are more comprehensive and distributionally progressive.
    Keywords: Latin America, social insurance, social assistance, social protection, poverty, inequality
    Date: 2011
  5. By: Guillermo Alves (Universidad de la República (Uruguay). Facultad de Ciencias Económicas y de Administración. Instituto de Economía); Verónica Amarante (Universidad de la República (Uruguay). Facultad de Ciencias Económicas y de Administración. Instituto de Economía); Gonzalo Salas (Universidad de la República (Uruguay). Facultad de Ciencias Económicas y de Administración. Instituto de Economía); Andrea Vigorito (Universidad de la República (Uruguay). Facultad de Ciencias Económicas y de Administración. Instituto de Economía)
    Abstract: The purpose of this study is to analyze the evolution of income inequality in Uruguay in 1986-2009 and its main driving forces. During 1986-1994 inequality remained almost unchanged, whearas it grew in 1994-2007 and startd to fall in 2007-2009. We carry out an inequality decomposition by income source which shows that the evolution of earning inequality and the inception of non contributory public transfers are the main explanatory factors of the evolution of inequality across the whole period. The inception of income transfer schemes, targeted towards the first income quintile contribute to explain the recent descent in inequality. In order to single out the main factors explaining the evolution of earnings inequality we carried out a micro simulation exercise. Results show that increasing returns to education were the main factor underlying this evolution. The recent decrease in inequality is also associated to the decrease in skill premia. At the same time, increasing employment rates and the reduction of the regional gap also had an equalizing effect. Meanwhile the scarce contribution of schooling in general and, specifically, in the recent descent in inequality poses a challenge for the design of educational policies. Our study also suggests that most of the recent reduction in inequality is related to the recent redistributive reforms such as increasing the value of minimum wages, centralized wage-setting mechanisms and the income tax. It is still too soon to assess whether this recent movement is a permanent trend. The analysis was based in the Uruguayan Household Surveys (Encuestas Continuas de Hogares) carried out by Instituto Nacional de Estadística.
    Keywords: income inequality, labor market, returs to education, transfers, Uruguay
    JEL: D31 J30
    Date: 2012–02
  6. By: Geraint Johnes; R Freguglia; G Spricigo; A Aggarwal
    Abstract: The effect of education on labour market outcomes is analysed using both survey and administrative data from The Brazilian PNAD and RAIS-MIGRA series, respectively. Occupational destination is examined using both multinomial logit analyses and structural dynamic discrete choice modelling. The latter approach is particularly useful as a means of evaluating policy impacts over time. We find that policy to expand educational provision leads initially to an increased take-up of education, and in the longer term leads to an increased propensity for workers to enter non-manual employment.
    Date: 2011
  7. By: Bruno Martorano; Marco Sanfilippo; UNICEF Innocenti Research Centre
    Abstract: Social protection represents an important tool to mitigate poverty and to promote adequate living standards and conditions. In Latin America social protection has largely taken the form of large scale implementation of conditional cash transfers (CCTs). These transfers have proven successful in combating poverty and inequality across the continent, while facilitating empowerment by increasing access to services and supporting investment in education, health and nutrition. Chile Solidario is an avant garde CCT in the Latin American context, introducing innovative features which are aimed at specifically addressing the multidimensional nature of poverty, considered not only as a consequence of the lack of income, but also as a result of low levels of human and social capital, and the vulnerability of a household to shocks.
    Keywords: programme evaluation; social protection;
    JEL: C19 I38
    Date: 2012
  8. By: Gustavo Crespi; Pluvia Zuñiga
    Abstract: This study examines the impact of innovation strategies on employment growth in four Latin American countries (Argentina, Chile, Costa Rica, and Uruguay) using micro-data for manufacturing firms from innovation surveys. Building on the model proposed by Harrison et al. (2008), we relate employment to three innovation strategies: make only (R&D), buy only (external R&D, licensing of patents and know-how, technical assistance, and other external innovation activities) and make and buy (mixed strategy). Firms that conduct in-house innovation activities ("make only") have the greatest impact on employment; the "make and buy" strategy comes in second. Similar results are found for small firms. These results highlight the importance of fostering in-house technological efforts not only for innovation per se, but also to promote growth in firm employment. The impact of "make only" strategies is greater in high-tech industries, whereas "make only" and "make and buy" have a similar impact on employment in low-tech industries. Finally, the study provides evidence of the mechanisms through which innovation strategies affect employment. The findings show that innovation strategies enhance technological innovation, but their impact differs between product and process innovation. Product innovation is mainly motivated by in-house technology investments, followed by mixed strategies, whereas process innovation is basically driven by "buy" strategies.
    Keywords: Economics :: Productivity, Economics :: Economic Development & Growth, Private Sector :: SME, Science & Technology :: Research & Development, Science & Technology :: New Technologies, innovation, employment, external R&D, Latin America, innovation surveys, CTI, IFD, RG-K1164
    JEL: O12 O31 O33 O40 J21 O14
    Date: 2012–03
  9. By: Ivone Perazzo (Universidad de la República (Uruguay). Facultad de Ciencias Económicas y de Administración. Instituto de Economía)
    Abstract: This paper describes the evolution of the Uruguayan labor market between 2000 and 2010 based on household surveys data (Encuesta Continua de Hogares, ECH). This period covers the 2002 economic crisis, where labor market conditions substantially worsened - employment rates fell, unemployment peaked and real wages sharply fell - as well as a significant recovery since 2004. At present, unemployment rates are located at a historical minimum. Also, since 2007 labor earning inequality started to decline, reversing the upwards trend observed since the mid 1990s. However, there are still some difficulties thar involve challenges for emplyment policies. First, the possible constraints to economic growth thar could arise due to supply constraints that have already been identified prevailing both in previus studies (Perazzo, 2008; CINVE, 2007, for example) and in the recent national dialogue promoted by the MTSS. Secondly, although total unemployment is no longer considered a concern, it still exhibits hight levels for certain vulnerable groups, such as women and youth. Thirdly, despite the significant dynamism in the economy and policies deplodyed to reduce the levels of non-social security registration, the percentage of workers without pension rights remains high.
    Keywords: labor market, Uruguay, unemployment, labor earning, labor force participation, employment
    JEL: J01 J08 J3
    Date: 2012–02
  10. By: Guillermo Alves (Universidad de la República (Uruguay). Facultad de Ciencias Económicas y de Administración. Instituto de Economía); Mariana Zerpa (Universidad de la República (Uruguay). Facultad de Ciencias Económicas y de Administración. Instituto de Economía)
    Abstract: There is partial evidence that suggests that adolescences living in rural aereas in Uruguay enjoy fewer opportunities than those living in urban aereas. In this paper we aim to provide a well-being comparison of adolescent living in rural and urban areas in Uruguay. The analytical framework in based on Capability Approach developed by Sen (1992) and Nussbaum (2001). We follow the methodological recommendations proposed by Alkire & Foster (2007). In sharp contrast in the conclusions from the country's official income-based poverty measure, which acknowledges lower poverty levels in rural areas, our results shows that youngsters living in rural aereas live in worse conditions than urban ones.
    Keywords: capability approach, multidimensional poverty, adolescents, Uruguay
    JEL: I32 O54 R23
    Date: 2011–07
  11. By: Galiani, Sebastian
    Abstract: We study the effects of titles on parcel valuation and urban land market development (real estate transfers, rentals, and mortgages), and the dynamics of deregularization by exploiting a natural experiment in the allocation of land titles to very poor families in a suburban area of Buenos Aires, Argentina. This natural experiment has been previously exploited to study effects of land titling on child health (Galiani and Schargrodsky 2004), on the formation of beliefs (Di Tella et al. 2007), and on investment, credit access, household structure, and educational achievement (Galiani and Schargrodsky 2010).
    Keywords: land titling, deregularization, titling premium
    Date: 2011

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