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Explaining Inequality and Poverty Reduction in Bolivia
Author: Mr. Mauricio Vargas and Santiago Garriga
Series:
IMF Working Papers
Volume/Issue:
Volume 2015: Issue 265
Language:
English
Publication Date:
18 Dec 2015
DOI:
https://doi.org/10.5089/9781513529608.001
ISBN:
9781513529608
ISSN:
1018-5941
Pages:
32
Keywords:
WP; labor income; Bolivia; Inequality; Poverty; poverty indicator; inequality reduction; Household survey; growth rate respect; Personal income; Income inequality; Poverty reduction; South America
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IMF Working Papers describe research in progress by the author(s) and are published to elicit comments and to encourage debate. The views expressed in IMF Working Papers are those of the author(s) and do not necessarily represent the views of the IMF, its Executive Board, or IMF management.
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We investigate the factors driving Bolivia’s success in reducing inequality and poverty during the last 15 years. Our evidence suggests that the reduction was driven mainly by labor income growth at the bottom end of the income distribution. Increases in non-labor income (rents, transfers, remittances) also played a role, but a smaller one, although the introduction of Renta Dignidad has made a big difference for the elderly poor. Labor income increases were concentrated in the informal, low-skilled service and manufacturing sectors. As the gains from the commodity boom go into reverse, and the fiscal envelope becomes much tighter, it will be essential that labor and social policies are well designed and targeted to preserve the poverty and inequality reduction of the last 15 years.
Cover IMF Working Papers
IMF Working Papers
ISSN:
1018-5941
Publisher:
International Monetary Fund