Measuring the relative pay of school teachers in Latin America 1997–2007

How much are teachers paid in comparison to those in other professions in Latin America? How have these differences evolved in recent years? Is teachers’ underpayment more pronounced in certain segments of the labor markets? This paper documents answers for those questions using data for thirteen Latin-American countries circa 1997 and circa 2007. After controlling the earnings differentials by observable characteristics we find that teachers are underpaid vis-à-vis other professionals and technicians in Latin America both, circa 1997 and circa 2007; and both, at their main and secondary jobs. We document a decrease in the earnings gap during the decade of analysis, mostly attributed to a general trend in gap reduction rather than as a result of teachers’ improvements on their observable characteristics. The earnings gap shows important heterogeneities, across countries and along the earnings distributions. Additionally, using information from the main and secondary jobs we find that individual penalties for teachers go beyond their observable characteristics.