Spatial Inequalities in Latin America: Mapping Aggregate to Micro-Level Disparities

We examine three dimensions of spatial inequality in Latin America and the Caribbean (LAC): between rural and urban areas (rural-urban divide), between large and small cities (metropolitan bias or centralization) and within metropolitan areas (urban segregation). As a first approach, we use information from the Luxembourg Income Study survey data to decompose an inequality measure between urban and rural areas and between large and smaller cities for 9 LAC countries and 13 developed countries. The results indicate that LAC countries are in general more unequal than developed economies along all spatial dimensions. However, there are several salient structural differences between both groups of countries worth noting. First, the rural-urban divide is much larger in absolute terms as well as relative (to overall inequality) terms in LAC compared to the developed countries in the sample. Second, there is some evidence pointing to a centralization or metropolitan bias in the LAC region compared to the developed countries. Within urban inequality measure in smaller cities is the largest decomposition term both in LAC as well as developed countries. This implies that more emphasis should be placed on poverty rates in smaller urban areas and not just large metropolitan areas. As a second approach we characterize the structure of Latin American cities with those of other regions of the world using data from the Atlas of Urban Expansion (AUE) (Blei and Angel, 2021). Finally, we also summarize some case studies to better understand the issues surrounding segregation in LAC urban areas. One feature of LAC is the concentration of the poor in informal settlements in the periphery of cities, generating unequal access to employment, education, and health services as well as other mobility related issues. Overall, we conclude that poverty has a spatial or territorial dimension in LAC that needs to be addressed. Although there is no single policy to tackle the complexity of spatial inequality, in the final section we discuss the importance of infrastructure investments and transport policies to address the issues raised in this paper.