ERIC Number: ED458183
Record Type: Non-Journal
Publication Date: 2001-Oct
Evolution of Earnings and Rates of Returns to Education in Mexico.
This paper reviews the factors and mechanisms that have been driving inequality in Mexico and finds that educational inequality accounts for by far the largest share of Mexico's variation in earnings inequality. More specifically, it examines the expansion in earnings inequality with emphasis on the role of education, establishes an analytical framework that permits analysis of the interaction between education and the labor market, and examines the evolution of earnings inequality in light of the macroeconomic and educational policies that followed in the 1980s and 1990s. The contribution of inequality of education to inequality of earnings in Mexico is the second highest in Latin America, after Brazil, and the significance of education has been increasing over time. Moreover, the income effect is always prevalent, and the distribution of education is highly significant even after controlling for changes in other relevant variables, such as age, economic sector, region, and labor market status. The increase in earnings inequality, however, does not appear to be the result of a worsening in the distribution of education, although the income profile, which is related to the returns to schooling, has become much steeper. This means that the shift in demand toward high-skilled labor has not been matched by an increase in supply. The probable reason is that the Mexican economy's increased openness has facilitated the transmission of skill-biased technological change. (Contains 21 tables, 33 notes, 3 annexes, and 51 references.) (Author/BT)
Descriptors: Comparative Education, Economic Development, Educational Policy, Equal Education, Foreign Countries, Income, Labor Market, Return on Investment, Salary Wage Differentials
World Bank Publications, P.O. Box 960, Herndon, VA 20172-0960. Tel: 800-645-7247 (Toll Free); Tel: 703-661-1580; Fax: 703-661-1501; e-mail: email@example.com; Web site: http://econ.worldbank.org/. For full text: http://econ.worldbank.org/files/2471_wps2691.pdf.
Publication Type: Information Analyses
Education Level: N/A
Authoring Institution: World Bank, Washington, DC.
Identifiers - Location: Mexico