Paper short abstract:

We will examine the evolution of income inequality and precariousness in Brazil and Mexico during the period 2005-2016

Paper long abstract:

In a series of recent texts we have worked on the impact that job precariousness has on income inequality, both at the national and subnational level in Brazil, Ecuador an México. The guiding idea is that the expansion (or contraction) of precarious work depends on the existence of a cumulative circular causation process (in other words a double feedback mechanism) that links inequality to job precariousness: the persistence of precarious work leads to increasing inequality, as one of the main characteristics of the former is the payment of low wages; on the other hand, increasing wage inequality negatively affects labor bargaining power, facilitating the imposition of precarious work relations upon the workforce.

We have tested this mechanism, by comparing the evolution of a precariousness index, based Jerry Rodgers´s original definition of precariousness., and different measures of inequality.

Our paper will present an expanded discussion of the links between labor bargaining power, precariousness and inequality. Then we will proceed to discuss the construction of a precariousness index that can be estimated with existing data in Latin American countries and will present the political economic logic behind its construction. In sequence, we will discuss the evolution of income inequality, precariousness and bargaining power in Brazil and México from 2005 to 2016