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New Order and ProgressDevelopment and Democracy in Brazil$
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Ben Ross Schneider

Print publication date: 2016

Print ISBN-13: 9780190462888

Published to Oxford Scholarship Online: June 2016

DOI: 10.1093/acprof:oso/9780190462888.001.0001

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Understanding Recent Dynamics of Earnings Inequality in Brazil

Understanding Recent Dynamics of Earnings Inequality in Brazil

(p.187) 8 Understanding Recent Dynamics of Earnings Inequality in Brazil
New Order and Progress

Francisco H. G. Ferreira

Sergio P. Firpo

Julian Messina

Oxford University Press

The Gini coefficient of labor earnings in Brazil fell by 20 percent between 1995 and 2012, from 0.5 to 0.4. The decline was even larger by other measures, with the 90-10 percentile ratio falling by almost 40 percent. Although the conventional explanation of falling returns to education did play a role, substantial reductions in the gender, race, and spatial wage gaps, conditional on human capital and institutional variables, explain the lion's share of the decline in earnings inequality. Lower male, white, urban, and southeast wage premia, alongside lower formal-informal wage gaps, account for 6.3 of the 10-Gini-point difference between 1995 and 2012. Although rising minimum wages contributed to the decline during 2003-2012, they had no such effect during 1995-2003.

Keywords:   earnings inequality, Brazil, RIF regressions, wage gap, Gini coefficient

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