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A cohort analysis of the income distribution in Chile

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  • Claudio Sapelli

Abstract

In this paper we look at the income distribution by cohort in Chile. We construct a synthetic panel from cross section surveys and estimate the income distribution for cohorts born between 1902 and 1978. We then decompose the evolution of these distributions into age, year and cohort effects. The cohort effects show a period where inequality increases, to then decrease. We attempt to explain this evolution. The rise can be explained by variables associated with education, while the fall appears to be the consequence of a flattening of the income-age profile and hence a reduction in the returns to experience.

Suggested Citation

  • Claudio Sapelli, 2011. "A cohort analysis of the income distribution in Chile," Estudios de Economia, University of Chile, Department of Economics, vol. 38(1 Year 20), pages 223-242, June.
    • Handle: RePEc:udc:esteco:v:38:y:2011:i:1:p:223-242
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    References listed on IDEAS

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    1. Jacob A. Mincer, 1974. "Introduction to "Schooling, Experience, and Earnings"," NBER Chapters, in: Schooling, Experience, and Earnings, pages 1-4, National Bureau of Economic Research, Inc.
    2. Zvi Eckstein & Eva Nagypal, 2004. "The evolution of U.S. earnings inequality: 1961?2002," Quarterly Review, Federal Reserve Bank of Minneapolis, vol. 28(Dec), pages 10-29.
    3. Claudio Sapelli., 2009. "Los Retornos a la Educación en Chile: Estimaciones por Corte Transversal y por Cohortes," Documentos de Trabajo 349, Instituto de Economia. Pontificia Universidad Católica de Chile..
    4. Jacob A. Mincer, 1974. "Schooling, Experience, and Earnings," NBER Books, National Bureau of Economic Research, Inc, number minc74-1, June.
    5. Ricardo Paredes & Victor Lima, 2004. "Labor Market Regimes and Mobility through a Markov Chain in Chile," Econometric Society 2004 Latin American Meetings 317, Econometric Society.
    6. Jacob A. Mincer, 1974. "Schooling and Earnings," NBER Chapters, in: Schooling, Experience, and Earnings, pages 41-63, National Bureau of Economic Research, Inc.
    Full references (including those not matched with items on IDEAS)

    Citations

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    Cited by:

    1. Mac-Clure, Oscar, 2012. "Chile's new middle classes: a cohort analysis," Revista CEPAL, Naciones Unidas Comisión Económica para América Latina y el Caribe (CEPAL), December.
    2. Contreras, Dante & Gallegos, Sebastian & Meneses, Francisco, 2009. "Determinantes del desempeño universitario: ¿Importa la habilidad relativa? [University performance determinants: does relative ability matter?]," MPRA Paper 23320, University Library of Munich, Germany.
    3. Claudio, Sapelli, 2014. "Desigualdad, movilidad, pobreza: necesidad de una política diferente," Estudios Públicos, Centro de Estudios Públicos, vol. 0(134), pages 59-84.
    4. Harry Aginta & Debby A. Soraya & Wahyu B. Santoso, 2018. "Financial Development and Income Inequality in Indonesia: A Sub-national Level Analysis," Economics and Finance in Indonesia, Faculty of Economics and Business, University of Indonesia, vol. 64, pages 111-130, Desember.
    5. Jaime Ruiz-Tagle, 2007. "Forecasting wage inequality," Estudios de Economia, University of Chile, Department of Economics, vol. 34(2 Year 20), pages 141-162, December.
    6. Estéfano rubio, 2016. "El diálogo de dos desafíos: evolución y relación de la desigualdad y la escolaridad en Chile," Puntos de Referencia DPP-15, Centro de Estudios Públicos.
    7. Claudia Sanhueza & Ricardo Mayer, 2011. "Top Incomes in Chile using 50 years of household surveys : 1957-2007," Estudios de Economia, University of Chile, Department of Economics, vol. 38(1 Year 20), pages 169-193, June.
    8. Diego Battistón & Carolina García-Domench & Leonardo Gasparini, 2014. "Could an Increase in Education Raise Income Inequality? Evidence for Latin America," Latin American Journal of Economics-formerly Cuadernos de Economía, Instituto de Economía. Pontificia Universidad Católica de Chile., vol. 51(1), pages 1-39, May.
    9. López, Ramón & Miller, Sebastian J., 2008. "Chile: The Unbearable Burden of Inequality," World Development, Elsevier, vol. 36(12), pages 2679-2695, December.
    10. Aginta, Harry & Soraya, Debby A & Santoso, Wahyu B, 2018. "Financial Development and Income Inequality in Indonesia: A Sub-national Level Analysis," MPRA Paper 97655, University Library of Munich, Germany.

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    More about this item

    Keywords

    Synthetic cohorts; Income distribution; Rates of return; Education.;
    All these keywords.

    JEL classification:

    • I20 - Health, Education, and Welfare - - Education - - - General
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials

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