This study is a reprint of the second volume of the “Economic Survey of Latin America and the Caribbean” publication, published annually by the Economic Development Division of the Economic Commission for Latin America and the Caribbean (ECLAC). Decentralization is an important issue affecting the role of the state in improving distributive justice, and the expected benefits of decentralization should be evaluated in the context of each country's idiosyncrasies. We are proud to present this publication as one of the first produced by the new Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) GmbH.
In European countries the income of the tenth decile is 20% to 30% more than that of the ninth, in Latin America this gap tends to be over 100% and in some cases approaches 200%.
Introduction
The GDP per capita of Europe's richest area is almost double that of the lowest-income area in the same country, in Latin America that ratio is about six. These indicators reflect the difficulty of the task of improving equity and cohesion and show the complexity of achieving that goal through decentralized policy, since. Levels of poverty are another important variable in trying to understand the situation of the Latin American countries, in terms of their ability to generate resources to meet the needs of the population and to design public policies to lead to greater equality.
The public sector also plays a greater role in those countries as far as the provision is concerned.
Macroeconomic volatility, employment and income distribution
Characteristics of volatility in Latin America and the Caribbean
Macroeconomic instability, as a source or reflection of underdevelopment (Chang, Kaltani and Loayza, 2009) has therefore been a subject of particular interest in analyzing the external performance of the Latin American and Caribbean region. Increased risk aversion among investors during turbulent periods in the region, when crises involve several countries at once, can abruptly end slow-maturing projects, undermining investment efficiency. Another stylized fact is that consumption is more volatile than GDP in Latin America and the Caribbean (Toledo, 2008).
The high volatility of consumption means that poverty rates are also highly variable, especially when there is a high density of households with income per capita. population close to the poverty line.
The consequences of volatility
Source: Economic Commission for Latin America and the Caribbean (ECLAC), based on official information from the countries concerned. In the Latin American and Caribbean region, the scale of political space can change very quickly after a shock. In the Latin American and Caribbean region, the scale of political space can change very quickly after a shock.
0 Quintile I Quintile II Quintile III Quintile IV Quintile V Source: Economic Commission for Latin America and the Caribbean.
Characteristics of growth and its distributive impact
The income gap between those with at least some schooling and workers with intermediate levels of education has not widened, perhaps because of the sharp increase in the supply of labor with secondary education. Analysis of the statistics shows that the employment rate for women living in urban areas increased significantly in the 1990s, but has only increased slightly in recent years. The income gap between men and women narrowed in the 1990s (both for wage earners and for the wider employed population), both overall and for each of the three educational groups.
Housing expenses were Chile, Colombia, Panama and Uruguay, to the situation case in the countries of all areas of spending were procyclical; in spending, while for the Dominican and Development (OECD).
The distributive impact of public policy and financing
Taxation as a distributive policy tool
The tax burden of the other thirteen countries is clearly lower than it should be on the basis of their level of development. The tax burden of the other thirteen countries is clearly lower than it should be on the basis of their level of development. The structure in Latin American countries is therefore the reverse of the structure in OECD countries.
Second, per capita (or family) income in developed countries is higher, making a larger percentage of the population subject to income tax.
Distributive impact of social policies
Social policy focus in the region
In short, the state is given greater strategic weight in efforts to address the problems caused by inequality and lack of welfare. As Box I.1 shows, one of the problems with social spending in the region is its highly procyclical nature. Furthermore, the current financial crisis and its impact on the real economy has led governments in the region to double and diversify their countercyclical social spending.
In Latin America, the poverty rate among children is much higher than among the adult population. However, expenditures for such programs account for an average of only 0.25% of GDP and 2.3% of social expenditures in the region. These problems arise from structural limitations related to the characteristics of the labor market in the region: the high degree of informality and frequent periods of unemployment; low rate of participation in work among poor women;
However, their spread and institutionalization is still limited in most countries of the region. Between 60% and 75% of these transfer expenditures are covered by the poorest 40% of the population (see figure III.4). As stated above, the region now faces a scenario characterized by pronounced social segmentation in the sphere of work (formal workers, informal workers and the unemployed) and, consequently, in the field of social protection.
The most important lesson to be learned from these reforms is that the reality of the region's labor markets does not allow basing a pension system on the contributory component alone. This is partly the approach taken by recent pension system reforms in the region.
Social policies in the areas of pensions, health and education
It was replaced was created in the framework of the public in the system; gradually seek self-with a contributory system based on individual financing regime. This was the starting point for the creation of a single public health care system financed from general revenue that integrated almost all social security schemes. Segmentation of the health care system is present in virtually all Latin American and Caribbean countries.
A wide variety of health care institutions and mechanisms for funding, insurance, regulation and service delivery exist, generally combining a specialized public system with certain functions of the social security systems and the private sector. The functioning of the system as a whole depends on how these three subsectors are connected. If the compulsory contribution is for the National Health Fund, the contributor is a member of the public system.
However, for access to other National Health Fund services there are co-payments which vary depending on the beneficiary's income group and the cost of the service. However, for access to other National Health Fund services there are co-payments which vary depending on the beneficiary's income group and the cost of the service. Public health care system for the solidarity contribution made by members of the status quo, both by the beneficiaries uninsured from the contributory regime (approximately from the old social security system and by.
In this sense, the coverage of education in the countries of the region has improved significantly since 1990. Between 1980 and 1986, roughly, Chile underwent one of the most radical reforms ever to occur in the region.
Assigning functions to different levels of government
In Argentina, Brazil, Colombia and the plurinational state of Bolivia, subnational governments spend more than 70% of total government expenditure on education and about half of government expenditure on health care (see Figure 25). In Argentina, Brazil, Colombia and the plurinational state of Bolivia, subnational governments spend more than 70% of total government expenditure on education and about half of government expenditure on health care (see Figure III.6). Source: Economic Commission for Latin America and the Caribbean (ECLAC), based on official information. percentage of GDP) (percentages of the total non-financial public sector.
In Argentina, Mexico and the Plurinational State of Bolivia, they exceed seven percentage points of GDP; in Colombia and Ecuador they are in the range of 4% of GDP. 36 The only countries in which the subnational tax burden increased are Brazil and the Plurinational State of Bolivia. In Brazil, the states and municipalities collect about one-third of the total, mainly due to revenues from the sales tax on goods and services (ICMS), which is the responsibility of the states and the federal district.
In Argentina, Mexico and the plurinational state of Bolivia, they exceed seven percentage points of GDP; in Colombia and Ecuador they are in the region of 4% of GDP. As previously mentioned, tax collections from subnational governments have stagnated over the last 11 years, and differences in subnational tax burdens among countries in Latin America have been constant. 12. Source: Economic Commission for Latin America and the Caribbean (ECLAC), based on official information.
Own tax revenue Total transfers Other revenue Source: Economic Commission for Latin America and the Caribbean (ECLAC), the 12 The only countries where the subnational tax burden has increased are Brazil and the plurinational state of Bolivia.
Conclusions and challenges for the future
Source: Economic Commission for Latin America and the Caribbean (ECLAC), based on official data from the International Monetary Fund (IMF) and national sources. LATIN AMERICA AND THE CARIBBEAN: STOCK INDEXES (national indices to end of period, December 31, 2000=100). LATIN AMERICA AND THE CARIBBEAN: MONETARY BASE (year-end balances as percentages of GDP).
LATIN AMERICA AND THE CARIBBEAN: FOREIGN CURRENCY DEPOSITS (Year-end balances as a percentage of GDP).
