Relative Wages, Skill Shortages, and Changes in Income Distribution in Colombia.

by Robert L. Slighton

Purchase Print Copy

 FormatList Price Price
Add to Cart Paperback75 pages $25.00 $20.00 20% Web Discount

An analysis of the income distribution relative to the economic growth in Colombia. Distribution of income in Colombia has been, and is, very unequal: 10 percent of the population of the large cities receives about half of the total personal income. This study examines the hypothesis that this inequality will widen if growth of the modern sector of the economy is retarded after the transition from agrarianism to the dual economy is begun. In Colombia, this increase in inequality resulted from the combined effect of an increase in unemployment, an increase in the wage differential between subsectors of the economy characterized by changing technology (modern) and subsectors where technology is static (traditional), and a rate of growth of employment in the modern subsectors that is less than in the traditional subsectors. The widening wage differential between the modern and traditional subsectors is a result of more intensive educational differences, and of differences in the competitive structure of the labor and product markets. This pattern of change of income distribution may alter if population growth is controlled, if export (hence import) capabilities are developed, and if labor force quality is upgraded to allow for modern subsector domination of the economy. 75 pp.

This report is part of the RAND Corporation research memorandum series. The Research Memorandum was a product of the RAND Corporation from 1948 to 1973 that represented working papers meant to report current results of RAND research to appropriate audiences.

This research in the public interest was supported by RAND, using discretionary funds made possible by the generosity of RAND's donors, the fees earned on client-funded research, and independent research and development (IR&D) funds provided by the Department of Defense.

The RAND Corporation is a nonprofit institution that helps improve policy and decisionmaking through research and analysis. RAND's publications do not necessarily reflect the opinions of its research clients and sponsors.