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Decomposing Changes in Male Wage Distribution in Brazil

In: Income Inequality Around the World

Author

Listed:
  • Yang Wang
  • Nora Lustig
  • Otavio Bartalotti

Abstract

Between 1995 and 2012, the wage distribution of male workers in Brazil shifted to the right and became less dispersed. This paper attempts to identify the reasons for that movement in male wage distribution, focusing on the impact of education expansion on wage distribution. The Oaxaca-Blinder (OB) and Recentered Influence Function (RIF) decomposition results show that both changes in returns on skills and upgrades in the composition of work skills contribute to increases in the average wage and wages at the 10th and 50th percentiles. The shifts in returns to skills had a decreasing impact on wages at the 90th percentile and are identified as the primary force reducing wage inequality. Education expansion had an equalizing impact on wage distribution, primarily through the decline in return to education.

Suggested Citation

  • Yang Wang & Nora Lustig & Otavio Bartalotti, 2016. "Decomposing Changes in Male Wage Distribution in Brazil," Research in Labor Economics, in: Income Inequality Around the World, volume 44, pages 49-78, Emerald Group Publishing Limited.
    • Handle: RePEc:eme:rleczz:s0147-912120160000044009
    DOI: 10.1108/S0147-912120160000044009
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    Citations

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    Cited by:

    1. Francisco H G Ferreira & Sergio P Firpo & Julián Messina, 2022. "Labor Market Experience and Falling Earnings Inequality in Brazil: 1995–2012," The World Bank Economic Review, World Bank, vol. 36(1), pages 37-67.
    2. Fernández, Manuel & Messina, Julián, 2018. "Skill premium, labor supply, and changes in the structure of wages in Latin America," Journal of Development Economics, Elsevier, vol. 135(C), pages 555-573.
    3. John Ariza & Gabriel Montes-Rojas, 2019. "Decomposition methods for analyzing inequality changes in Latin America 2002–2014," Empirical Economics, Springer, vol. 57(6), pages 2043-2078, December.

    More about this item

    Keywords

    Wage inequality; decomposition; wage structure effect; composition effect; education expansion; J31; J82; I24;
    All these keywords.

    JEL classification:

    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • J82 - Labor and Demographic Economics - - Labor Standards - - - Labor Force Composition
    • I24 - Health, Education, and Welfare - - Education - - - Education and Inequality

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