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Trade Liberalization, Inequality, and Poverty in Brazilian States

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  • Castilho, Marta
  • Menéndez, Marta
  • Sztulman, Aude

Abstract

This paper studies the impact of globalization on household income inequality and poverty using detailed microdata across Brazilian states from 1987 to 2005. Results suggest that trade liberalization contributes to growth in poverty and inequality in urban areas and may be linked to reductions in inequality (possibly poverty) in rural areas. In terms of observed integration into world markets, we find evidence indicating that in Brazil both state poverty and inequality decrease with rising export exposure but state poverty increases with import penetration.

Suggested Citation

  • Castilho, Marta & Menéndez, Marta & Sztulman, Aude, 2012. "Trade Liberalization, Inequality, and Poverty in Brazilian States," World Development, Elsevier, vol. 40(4), pages 821-835.
    • Handle: RePEc:eee:wdevel:v:40:y:2012:i:4:p:821-835
    DOI: 10.1016/j.worlddev.2011.09.018
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    More about this item

    Keywords

    trade liberalization; poverty and inequality; Latin America; Brazilian states;
    All these keywords.

    JEL classification:

    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
    • F16 - International Economics - - Trade - - - Trade and Labor Market Interactions
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade

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