Theme Five
Inequality and Political Power
In many LAC countries, political parties are weak, fragmented, and have shallow roots in society. Even in countries that used to have strong political parties, the electorate is increasingly disenchanted with traditional politicians.
Many countries in the region have experienced a rotation between right and left-wing governments. In line with these unstable political dynamics, governments throughout the region have limited bureaucratic capacity to implement policies and provide high quality public services that could promote equality of opportunities. This issue leaves the bottom- and middle-class vulnerable to economic shocks. In recent years, a wave of political unrest erupted in many LAC countries. While some of the unrest comes from the unmet demands of poorest shares of the population, it is puzzling that most comes from vocal groups in the middle class.
The fifth theme relates to the relationship between inequality and political power, establishing links with the four themes previously described. The network aims to provide an informed discussion of the inequality in political voice across Latin Americans. A second set of issues under this theme concerns on how the distribution of political power shapes the political economy of decision making.
Why is Latin America so persistently unequal despite political inclusion?
Learn further insights into the relationship between political power and inequality persistence in Latin America with our working papers by clicking on the links below:
Weak parties and the inequality trap in Latin America, by Noam Lupu
The interaction of economic and political inequality in Latin America, by Leopoldo Fergusson, James A Robinson, Santiago Torres
Opting out from public services and the social contract in Latin America, by Ana L De La O, Cecilia Rossel, Pilar Manzi
Origins of Latin American Inequality, by Francisco Eslava, Felipe Valencia Caicedo
The political economy of redistribution and (in)efficiency in Latin America and the Caribbean, by Matias Guizzo-Altube, Carlos Scartascini, Mariano Tommasi
Some key facts:
- Different countries in the region are in different political economy equilibria, and hence have different combinations of political economy syndromes and of socioeconomic outcomes (Scartasini et al., 2023).
- Large majorities of Latin Americans support redistribution, but governments are not responding to public demands to reduce inequality (Lupu, 2024).
- In LAC, policies that could reduce inequality are less likely to be adopted in areas with high inequality, suggesting a vicious circle perpetuating economic disparities (Fergusson et al., 2024).
- The extent to which people are opting out from essential public services, such as education and health, poses a challenge to an already fragmented social contract in Latin America (Manzi et al., 2023).
- Historical experiences, especially colonial institutions such as mitas, haciendas, encomiendas and concertajes, are important to explain the income and inequality patterns we observe today in Latin America (Eslava & Valencia Caicedo, 2023).
Panel Members
Julián Messina
Universidad de Alicante
Ana De La O Torres
Yale University
Ana María Ibáñez
Inter-American Development Bank
François Bourguignon
Paris School of Economics
Marcela Eslava
Universidad de Los Andes
Andrés Velasco
London School of Economics and Political Science
Orazio Attanasio
Yale University
