A comparison of wage dynamics in two Latin American countries: different policies, different outcomes



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Universidad EAFIT


This article explores the variations in the wage distribution in two Latin American countries, Bolivia and Colombia, which have had different economic policies in recent years -- Using data from household surveys, a decomposition of the wage distribution in each country using Functional Principal Component Analysis is conducted -- The results suggest that Bolivia, which has taken left-wing economic policies, has experienced a general increase in wages, especially benefiting the least skilled workers and the informal sector -- On the other hand, the wage distribution in Colombia, whose economic policy has been focused on free-market principles, has become more concentrated around the median wage, mainly due to changes in the formal sector wages


Palabras clave

Análisis de Componentes Principales, Análisis de Componentes Principales Funcionales (FPCA), Desigualdad de salarios