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Persistence and determinants of income inequality: The Brazilian case

Author

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  • Diogo Signor
  • Jongsung Kim
  • Edinaldo Tebaldi

Abstract

Latin America, which is a region known for its high and persistent income inequality levels, experienced a significant decline in income inequality since the second half of the 1990s. Brazil is a particularly interesting case in Latin America. While the country presented notable economic growth and improvements in income distribution in the early 2000s, Brazil continues to experience high levels of income inequality in comparison with other Latin American or advanced economies. This research contributes to the literature by examining the key drivers of income distribution and the degree of persistence of income inequality among Brazilian states. This research also improves upon previous works by using more recent and comprehensive data and addressing concerns regarding heterogeneity and endogeneity by using the system GMM estimation method. Our findings show that income inequality is highly persistent across Brazilian states and that government policies including income transfer programs made important contributions to reduce income inequality in Brazil. This study also shows that the decline in labor income ratios between different ethnic groups and the increase of the share of formal jobs in the labor market contributed to reduce income inequality.

Suggested Citation

  • Diogo Signor & Jongsung Kim & Edinaldo Tebaldi, 2019. "Persistence and determinants of income inequality: The Brazilian case," Review of Development Economics, Wiley Blackwell, vol. 23(4), pages 1748-1767, November.
    • Handle: RePEc:bla:rdevec:v:23:y:2019:i:4:p:1748-1767
    DOI: 10.1111/rode.12598
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    Cited by:

    1. Rudke, Anderson Paulo & Martins, Jorge Alberto & dos Santos, Alex Mota & Silva, Witan Pereira & Caldana, Nathan F. da Silva & Souza, Vinicius A.S. & Alves, Ronaldo Adriano & de Almeida Albuquerque, Ta, 2021. "Spatial and socio-economic analysis of public transport systems in large cities: A case study for Belo Horizonte, Brazil," Journal of Transport Geography, Elsevier, vol. 91(C).
    2. Helder Ferreira de Mendonça & Natália Ferreira Trigo, 2024. "What is the effect of imported inflation and central bank credibility on the poor and rich?," Applied Economics, Taylor & Francis Journals, vol. 56(21), pages 2520-2543, May.
    3. Margarida Bandeira Morais & Julia Swart & Jacob Arie Jordaan, 2021. "Economic Complexity and Inequality: Does Regional Productive Structure Affect Income Inequality in Brazilian States?," Sustainability, MDPI, vol. 13(2), pages 1-23, January.
    4. Arelys López-Concepción & Ana Gil-Lacruz & Isabel Saz-Gil & Víctor Bazán-Monasterio, 2022. "Social Well-Being for a Sustainable Future: The Influence of Trust in Big Business and Banks on Perceptions of Technological Development from a Life Satisfaction Perspective in Latin America," Sustainability, MDPI, vol. 15(1), pages 1-14, December.
    5. Sonan Memon & Irfan A. Qureshi, 2021. "Income inequality and macroeconomic instability," Review of Development Economics, Wiley Blackwell, vol. 25(2), pages 758-789, May.
    6. Diana Barros & Aurora A. C. Teixeira, 2021. "Unlocking the black box: A comprehensive meta-analysis of the main determinants of within-region income inequality," Review of Regional Research: Jahrbuch für Regionalwissenschaft, Springer;Gesellschaft für Regionalforschung (GfR), vol. 41(1), pages 55-93, February.
    7. Shengyun Wang & Liancheng Duan & Qin Zhu & Yaxin Zhang, 2022. "Spatial Differences of Ecological Well-Being Performance in the Poyang Lake Area at the Local Level," IJERPH, MDPI, vol. 19(18), pages 1-19, September.
    8. Herrera, Gabriel Paes & Constantino, Michel & Su, Jen-Je & Naranpanawa, Athula, 2023. "The use of ICTs and income distribution in Brazil: A machine learning explanation using SHAP values," Telecommunications Policy, Elsevier, vol. 47(8).

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