CEPAL Review

Cepal Review is the leading journal for the study of economic and social development issues in Latin America and the Caribbean. Edited by the Economic Commission for Latin America, each issue focuses on economic trends, industrialization, income distribution, technological development and monetary systems, as well as the implementation of economic reform and transfer of technology. Written in English and Spanish (Revista de la Cepal), each tri-annual issue offers approximately 12 studies and essays undertaken by authoritative experts or gathered from conference proceedings.

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Determinants of income inequality reduction in the Latin American countries

This article analyses patterns of income inequality and its determinants in the countries of Latin America in the period 2004–2013. First, income distribution in several countries is determined using the Theil index and is found to have decreased over the study period. An econometric panel data model is then employed to study the determinants of the level of inequality. Per capita GDP, per capita health spending, tax pressure, the poverty rate, the literacy rate and years of schooling are found to be statistically significant variables in explaining inequality. Multivariate techniques are then used to group the countries by level of inequality, thereby establishing a classification in terms of ability to reduce inequality.


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