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Trade, resources and inequality in Latin America

2002-12

LC/G.2187-P

This article uses international databases to empirically estimate the links between inequality and trade. It looks first at the links between trade openness, income distribution and relative factor abundance. Next, it uses the results obtained to analyse the changing relative resource endowment of Latin America and its distributive consequences. The main conclusion is that, behind the persistent high level of inequality in the region, substantive changes have been taking place. The Latin American pattern of relative resource abundance has changed with the inroads made by Asia, China and Russia into global trade, which have reduced Latin America's relative abundance of unskilled labour and resources, respectively. The developed countries have expanded their endowment of fixed capital, while Latin America has not been able to accumulate the physical and human capital that would make a stronger emphasis on external trade compatible with greater income equity.

Includes bibliography

Comisión Económica para América Latina y el Caribe (CEPAL) - Biblioteca Hernán Santa Cruz

Mirian Ramirez

Biblioteca CEPAL, Edificio Naciones Unidas, Av. Dag Hammarskjold 3477, Santiago, Chile

(+56-2) 2210-2337

Desarrollado por: Aikyu-Systems