April 2003

Economic Policy and Wage Differentials in Latin America

This paper assesses the effects of various economic policies on wage differentials in Latin America between 1977 and 1998. The authors find that on average, liberalizing policy changes have had the strongest positive effect on wage differentials, but that the overall effect tends to become smaller over time. The publication further on argues that privatization policies contributed to the narrowing of wage differentials while policies of trade openness had no significant effect on income inequality.

Download: