The rising wage inequality in Mexico, 1984-2000: A distributional analysis

Popli, Gurleen (2006): The rising wage inequality in Mexico, 1984-2000: A distributional analysis. Forthcoming in: Journal of Income Distribution

Abstract

In this paper we look at the distribution of wages to examine the extent and cause of the increasing wage inequality in Mexico over the last two decades (1984 to 2000). To understand the causes of the increase in inequality over time we do a counterfactual analysis. We find that over the last two decades not only did the inequality increase, there also was an erosion of real wages, and it's the middle class which was affected the most. Main reason for the decrease in real wages was the declining unionization in the country. While the main reason for the rise in inequality was the changing distribution of skills.

• Item Type: MPRA Paper
• Language: English
• Keywords: kernel density estimation; counterfactual distribution ; unions; trade liberalization; changing distribution of skills
• Subjects: C - Mathematical and Quantitative Methods > C1 - Econometric and Statistical Methods and Methodology: General > C14 - Semiparametric and Nonparametric Methods: General; J - Labor and Demographic Economics > J3 - Wages, Compensation, and Labor Costs > J31 - Wage Level and Structure ; Wage Differentials

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