New Century, Old Disparities Gender and Ethnic Earnings Gaps in Latin America and the Caribbean

Income inequality problems are linked, to an important extent, to earnings differentials between men and women, and to a greater extent, between whites and ethnic minorities. Individuals who self report being members of an ethnic minority receive hourly earnings that are, on average, 38% below the earnings of the rest of the population in the region. When faced with such striking differences in the effective capacity for income generation, many questions arise: How much of these differences are explained by differences in human capital? To what extent do individuals with the same observable endowment of human capital receive different salaries on the basis of their gender or ethnic condition? For what segments of the labor market are these wage differentials most pronounced? How have these gaps evolved over the years? To what extent are women and minorities confronted by access barriers to certain segments of the labor markets? What would the labor income distribution be if women or ethnic minorities reached the same human capital characteristics of their men or non-minority counterparts? What policy options promise to diminish these earnings gaps?This book tries to answer the questions outlined above using an innovative technique of matching comparisons (Ã ;opo, REStat 2008) which is introduced as an extension to the traditional Blinder-Oaxaca decompositions. The book is organized on the basis of different papers I have written in recent years, both alone and in co-authorship with other researchers. These papers are in circulation on the Internet as IDB Working Papers. Compiling them as a book is a good way to reach an important audience of policy and decision makers, as well as members of civil society, especially minority groups, which otherwise have limited access to these information sources.