Southern Exposure

Desde as Entranhas dos Labirintos Latinos.

Friday, November 07, 2003

Income inequality in Latin America

The Economist reports on a World Bank study on income inequality in Latin America (up to 2001).

Some quick observations from these numbers:

  • Argentina, and to a lesser extent Venezuela, has become much more unequal during the last years.

  • Brazil and Honduras have, on the other hand, improved in this regard.

  • The overall inequality coefficient (either averaged or weighted by population), didn't change much during the '90s.

I find this last fact quite unexpected, but perhaps it's because I live in Argentina, where inequality has practically skyrocket since the early '90s.

These are crucial figures, because to a large degree the political stability of any democratic government depends on achieving at least a somewhat tolerable degree of equality. Accordingly, countries with high and/or rising inequality indexes, like Argentina, Bolivia and Venezuela, have all experienced very serious political conflicts. It's also interesting to note that the last reported inequality index for the United States is 40.8, putting the country approximately in the middle point between Jamaica and Thailand (!) (by way of comparison, Denmark's is 24.7).

(To put the numbers from the report in perspective, here is a note on how the index of inequality, known as the Gini coefficient is calculated, and here's the data from the last U.N.'s Human Development Report.)


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