The Microeconomics of Income Distribution Dynamics in East Asia and Latin America (World Bank Publication)

Economists have had much to say about what causes aggregate economic growth, but they have been more reticent about the distributional dimension of that growth. Understanding development and the process of poverty reduction requires understanding not only how total income grows but also how its distribution behaves over time. This book is a major new contribution to that process. The authors propose a decomposition of differences in entire distributions of household incomes, shedding new light on the powerful, and often conflicting, forces that underpin the changes in poverty and inequality that accompany the process of economic development. This approach is applied to three East Asian countries--Indonesia, Malaysia, and China--and to four in Latin American--Argentina, Brazil, Colombia, and Mexico.

Economists have had much to say about what causes aggregate economic growth, but they have been more reticent about the distributional dimension of that growth. To understand development and the process of poverty reduction requires understanding not only how total income grows, but also how its distribution behaves over time. 'The Microeconomics of Income Distribution Dynamics in East Asia and Latin America' is a major new contribution to that process.

The authors propose a decomposition of differences in entire distributions of household incomes, shedding new light on the powerful, and often conflicting, forces that underpin the changes in poverty and inequality that accompany the process of economic development. This approach is applied to three East Asian countries—Indonesia, Malaysia, and China—and to four in Latin America—Argentina, Brazil, Colombia, and Mexico.

Annotation This book is a major new contribution to the study of how income distributions in developing countries evolve over time. The authors propose a generalisation of the well-known Oaxaca-Blinder decomposition of differences in mean earnings, extending it to entire distributions of household incomes. The method relies on estimating a simple model of household income determination, and on the use of such a model to simulate counterfactual distributions of income, each corresponding to a meaningful economic factor associated with the overall observed change. The authors apply this approach to three East Asian countries - Indonesia, Malaysia and Taiwan - and to four countries in Latin America - Argentina, Brazil, Colombia and Mexico This book is about how the distribution of income changes during the process of income development. Understanding development and the process of poverty reduction requires understanding not only how total income grows but also how its distribution behaves over time. The authors propose a decomposition of differences in entire distributions of household incomes, shedding new light on the powerful, and often conflicting, forces that underpin the changes in poverty and inequality that accompany the process of economic development. This approach is applied to three East Asian countries -- Indonesia, Malaysia, and China -- and to four in Latin America -- Argentina, Brazil, Colombia, and Mexico 'A copublication of the World Bank and Oxford University Press.'