Stability and Vulnerability of the Latin American Middle Class

Using panel data-sets from Mexico and Chile for the first years of the 21st century, the authors examine the determinants of middle-class intra-generational mobility. The middle class is defined by means of a latent index of economic well-being that is less sensitive to short-term fluctuation and me...

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Bibliographic Details
Published in:Oxford development studies 2013-12, Vol.41 (4), p.409-435
Main Authors: Torche, Florencia, Lopez-Calva, Luis F.
Format: Article
Language:English
Subjects:
Calculus
Chile
class mobility
Demographics
economic well-being
Education
Households
Human Capital
Income
Indexes
intra-generational mobility
Labour market
Latin America
Markets
Measurement
measures of income
Mexico
Middle Class
Middle classes
Occupational status
Poverty
Sociodemographic Factors
Twenty First Century
Upper class
Upper classes
Urban population
Vulnerability
Well Being
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Summary:Using panel data-sets from Mexico and Chile for the first years of the 21st century, the authors examine the determinants of middle-class intra-generational mobility. The middle class is defined by means of a latent index of economic well-being that is less sensitive to short-term fluctuation and measurement error than standard measures of income. The authors find high rates of both upward and downward mobility in Mexico and Chile, indicating that the middle class has opportunities to move to higher levels of well-being but is also vulnerable to falling into poverty. In both countries, labour-market resources (education and occupational status of the household head and number of members in the labour market) are much stronger determinants of mobility than demographic factors, suggesting the importance of policies that foster human capital and protect workers from shocks. Rural middle-class households are substantially more vulnerable to falling into poverty and have little chance of advancing to upper classes than their urban counterparts.
ISSN:1360-0818
1469-9966
DOI:10.1080/13600818.2013.831060