New Economics Papers
on Central and South America
Issue of 2013‒07‒05
four papers chosen by

  1. The distribution of income in Central America By Tim H. Gindling; Juan Diego Trejos
  2. Taxation and Inequality in the Americas: Changing the Fiscal Contract? By Richard M. Bird; Eric M. Zolt
  3. An economic model of Brazil's ethanol-sugar markets and impacts of fuel policies By de Gorter, Harry; Kliauga, Erika M.; Timilsina, Govinda R.
  4. Dimensões do Acesso a Medicamentos no Brasil: Prefil e Desigualdades dos Gastos das Famílias, Segundo as Pesquisas de Orçamentos Familiares 2002-2003 e 2008-2009 By Leila Posenato Garcia; Luís Carlos Garcia de Magalhães; Ana Cláudia Sant'Anna; Lúcia Rolim Santana de Freitas; Adriana Pacheco Aurea

  1. By: Tim H. Gindling (UMBC); Juan Diego Trejos (Universidad de Costa Rica)
    Abstract: We document changes in income and earnings inequality in the five Central American countries from the early 1990s to 2009. In the 1990s Costa Rica had the most equal distribution of income in Central America, and one of the most equal distributions of income in Latin America. At the other extreme, Guatemala, Honduras and Nicaragua were among the most unequal countries in Latin America. Inequality in El Salvador was between these extremes. Then, in the first decade of the 21st century inequality in El Salvador and Nicaragua decreased while inequality in Costa Rica, Guatemala and Honduras increased. By 2009 levels of inequality in El Salvador and Nicaragua were similar to those in Costa Rica. In this paper, we examine why income and earning inequality differs between the five Central American countries, and why inequality decreased in El Salvador and Nicaragua but increased in Costa Rica, Guatemala and Honduras
    Keywords: income inequality, Central America, labour income.
    JEL: O15 J31 O54
    Date: 2013–02
  2. By: Richard M. Bird (University of Toronto); Eric M. Zolt
    Abstract: Times change. In the words of an old English ballad, some things seem to have “turned upside down” in recent years. Since 2000, Latin America has become less unequal, with lower levels of poverty and likely greater economic mobility (Lustig, Lopez-Calvo and Ortiz-Juarez 2012), assisted in part by more progressive fiscal policy (Mahon 2012). In contrast, the United States has become more unequal (Piketty and Saez 2003, 2013), while poverty has remained relatively constant (U.S. Census Bureau 2012), economic mobility has likely declined (Hungerford 2008), and tax and spending policies have become less effective in reducing inequality (Harris and Sammartino 2011). This chapter examines whether the tide has really changed in Latin America or in the United States, and, if it has, what may lie ahead for these two regions of the Americas? Do recent events portend fortune or misery? Although the primary cause of the more equal income distribution in Latin America is probably the sharp increase in growth and employment following the challenging political and economic decade of the 1990s (Gasparini and Lustig 2011), fiscal policy played at least some role. Indeed, recent Latin American experience suggests that the pessimism prevalent since the 1970s about the extent to which taxation can affect income distribution has perhaps been misguided. Economic, social and political changes can and do give rise to new norms and power configurations, which sometimes result in important changes in the social and fiscal contract underlying governance structures.
    Date: 2013–05–04
  3. By: de Gorter, Harry; Kliauga, Erika M.; Timilsina, Govinda R.
    Abstract: The lack of growth in the Brazilian sugarcane-ethanol complex since the 2008 financial crisis has been blamed on policies: lower mandate, holding gasoline prices below world levels, high fuel taxes, and inadequate fuel tax exemptions for ethanol. This paper develops an empirical model of the Brazilian fuel-ethanol-sugar complex to analyze the impacts of these policies. Unlike biofuel mandates and tax exemptions elsewhere, Brazil's fuel-ethanol-sugar markets and fuel policies are unique such that each policy, in theory, has an ambiguous impact on the market price of ethanol and hence on sugarcane and sugar prices. The results indicate two policies that seemingly help the ethanol industry do otherwise in reality: low gasoline taxes and high anhydrous tax exemptions lower ethanol prices. But higher mandates, hydrous ethanol tax exemptions, and gasoline prices had the expected impact of increasing ethanol and sugar prices. Eliminating Brazilian ethanol tax exemptions and mandates reduces ethanol prices by 21 percent. Observed changes in prices are explained by outward shifts in fuel transportation and sugar export demand curves, and bad weather reducing sugarcane supply.
    Keywords: Energy Production and Transportation,Markets and Market Access,Transport and Environment,Renewable Energy,Alcohol and Substance Abuse
    Date: 2013–06–01
  4. By: Leila Posenato Garcia; Luís Carlos Garcia de Magalhães; Ana Cláudia Sant'Anna; Lúcia Rolim Santana de Freitas; Adriana Pacheco Aurea
    Abstract: O acesso a medicamentos no Brasil pode ser estudado por meio de diferentes recortes analíticos. Um desses recortes é o gasto das famílias com medicamentos, cujo peso em relação à renda das famílias brasileiras é amplamente conhecido. Este estudo tem como objetivo descrever os gastos das famílias brasileiras com medicamentos e analisar as desigualdades socioeconômicas expressas nesses gastos. O estudo inova em relação aos pregressos, uma vez que descreve os gastos segundo categorias de medicamentos e apresenta uma análise de desigualdades nos gastos incorporando não apenas o aspecto da renda mas, também, a percepção das condições de vida referidas pelas famílias. Foram utilizados os microdados das Pesquisas de Orçamentos Familiares (POFs) realizadas em 2002-2003 e 2008-2009, pelo Instituto Brasileiro de Geografia e Estatística (IBGE). O gasto com medicamentos foi o principal componente do gasto com saúde das famílias brasileiras. No período estudado, houve variação positiva de 10% no valor absoluto do gasto com medicamentos. Segundo a POF 2008-2009, o gasto médio foi R$ 59,02. Cerca de 77% das famílias tiveram registro de gasto com medicamentos durante o período de referência para coleta de dados, cujo gasto médio foi R$ 76,31. O gasto familiar per capita médio com medicamentos foi R$ 17,91. Entre as famílias pertencentes ao primeiro décimo de renda, esse gasto foi R$ 4,47, enquanto entre as famílias pertencentes ao último décimo foi R$ 58,44. As famílias com menor renda comprometiam, proporcionalmente, maior parcela da renda familiar na aquisição de medicamentos do que as famílias com maior renda. Em 2008-2009, as famílias no último décimo de renda gastaram com medicamentos, em termos absolutos, treze vezes o valor gasto pelas famílias pertencentes ao primeiro décimo, apesar das famílias com menor renda gastarem na aquisição desses bens essenciais, em termos absolutos, muito menos do que aquelas com maior renda. Ficou evidente que houve um aumento da proporção de famílias que tiveram gastos com determinadas categorias de medicamentos, principalmente analgésicos, antigripais, medicamentos para colesterol e problemas do coração. Por sua vez, houve redução da proporção de famílias que tiveram gastos com anti-infecciosos e anti-inflamatórios. A alta desigualdade na distribuição de renda, que ainda prevalece na sociedade brasileira, se manifesta da mesma forma na alta desigualdade do gasto das famílias com medicamentos. Access to medicines in Brazil can be studied using different analytical approaches. One of these approaches is the household spending on medicines, whose weight over the income of the Brazilian families is widely known. The study aims to describe the spending on medicines of the Brazilian families and to analyse socioeconomic inequalities in these expenditures. The study innovates, in relation to previous studies by describing the expenditures according to categories of medicines and on providing an analysis of the spending inequalities that incorporates, not only the aspect of income, but also the self-perception of living conditions of these families. The microdata used are from the Family Budget Surveys (POF) conducted in 2002-2003 and 2008-2009 by the Brazilian Institute of Geography and Statistics (IBGE). The spending on medicines, one of the main components of the health expenditures of Brazilian families, had a positive change of 10% in its absolute value, during the period studied. According to POF 2008-2009, the average expenditure was R$ 59.02. About 77% of the families recorded an average spending of R$ 76.31 on medicines during the reference period for data collection. The average of per capita expenditure on medicines was R$ 17.91. Families belonging to the bottom income decile had spent R$ 4.47, while those belonging to the top decile had spent R$ 58.44. Families with lower incomes undertook proportionately greater fraction of their income on purchasing medicines than those with higher incomes. In 2008-2009, the families in the top decile of income spent on medicines, in absolute terms, thirteen times the amount spent by those belonging to the bottom decile, despite the fact that families with lower income spend much less than those with higher incomes on acquiring these essential goods. The study showed an increase in the proportion of families that had expenditure of certain categories of medicines, especially analgesics, cold medication, and medicines for cholesterol and heart diseases. In turn, there was a reduction in the proportion of families that had expenditures on anti-infective and anti-inflammatory agents. The high inequality in income distribution still prevalent in the Brazilian society has been manifested, in the same way, in the high inequality of household spending on medicines.
    Date: 2013–06

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