Racial Inequality in the Uruguayan Labor Market:An analysis of wage differentials between Afrodescendants and whites.

Latin America is a region of sharp inequalities that are far from ethnically blind. In particular, there exists a significant socioeconomic gap between Latin Americans of European and the Afrodescendant and Indigenouos populations. Uruguay has usually been considered an exception to this pattern, although the lack of survey data about racial descent and ethnicity did not allow empirical analysis. In 2006, the National Institute of Statistics included a question on racial descent in the Household Survey. In this paper we use these microdata (for the first time) to analyze the wage gap between afro-descendants and whites. The wage ratio is 0.72 for men and 0.78 for women. For each sex, we perform OLS estimations, wage decompositions and quantile regressions. The estimations indicate that discrimination contributes to explain half of the average wage gap of men and 20% of the gap among femles. Part of discrimination works through the placement of Afro-descendant workers into lower-paid occupations. The most important attribute that explains the rest of the gap is education. Finally, quantile regressions show that discrimination declines with percentile.race, discrimination, wage inequality, Uruguay

Decomposing the Gaps between Afro-descendants and Whites along the Wage Distribution

In this paper we analyze the racial wage gap in Uruguay in the period 2006-2009 using data from the Household Survey collected by INE (the National Statistics Institute). We select a sample of full-time men workers aged 25-59. We decompose the gap between log hourly-wages of Whites and Afro-descendants at the mean and at each percentile of the wage distribution using the distributional regression approach proposed in Chernozhukov et al. (2009). We find that Afro-descendants are paid less in all position of the wage distribution and that the gap increases from the median up. It is around 0.20 until the median and reaches 0.60 at percentile 90. The results from the decomposition show that both the gap that can be explained by selected characteristics (years of schooling, potential experience and region) and the residual widen at the upper tail of the distribution.Wage gap, Afro-descendants, Discrimination, Counterfactual estimation

An estimation of the wage curve for Uruguay

This paper analyzes the existence of a wage curve in Uruguay. We run several models using data for the period 1986-2005. We use two different proxies of the wage and we estimate both microdata and cell-mean regressions. Besides, we run the model for the whole sample and for groups of individuals disaggregated by level of education, gender, age and occupation. The results are consistent with the range of values found in similar studies for other countries. We find a negative relation between unemployment and wages. Specifically, we obtain an elasticity of -0.09. We find a higher elasticity for the youth, women and less educated workers. We also obtain difference results when disaggregating by occupation and formality. The results suggest that an increase of unemployment pushes up informality and self-employment which lead to a depression of earnings in these sectors. Thus, informality and self-employment would act as a buffer for unemployed formal wage earners.wage curve, unemployment

Informality: Sectoral Selection and Earnings in Uruguay

In this paper we define informal workers as those who are not contributing to the social security system. We analyse the likelihood of being informal and we estimate the differentials in earnings between sectors using both the OLS estimation and a switching regression model. We assess the premium for being formal by predicting five different proxies of the average gap. We use the crosssection data reported in a 2005 household survey. We find that formality is more likely among the better-educated, women, people residing in the capital city, heads of households and full-time workers. In addition, we find that according to the five measures of the gap, earnings are higher in the formal than in the informal sector.informal sector, wage differential

Transferencias y visitas entre hijos y padres no corresidentes

The aim of this paper si to study the probability that a father who don’t live with their children transfers some amount of money or on kind and the frequency of visits. The papers analyse the relationship among these variables and characteristics of fathers, mothers and their union. According to the mothers, 58% of the fathers don’t make any transfers, 32% of the children don’t visit their fathers and 37% visit him at least once a week. The analysis suggests that the probability of making a transference has a positive relationship with the frequency of contacts.

Los efectos de la Reforma de la Seguridad Social sobre las cuentas generacionales

El presente trabajo tiene como objetivo analizar el impacto de la reforma de la seguridad social de 1995 sobre las cuentas generacionales, esto es, sobre el valor presente del conjunto de prestaciones netas de aportes percibidas a lo largo del ciclo de vida por distintas cohortes. Este tipo de análisis permite conocer el impacto de la reforma en términos de cuáles generaciones obtuvieron un beneficio neto y cuáles una pérdida. El estudio comprendió una apertura de las personas de una misma generación según su sexo y estrato de ingreso. Se encontró que, aún para personas de una misma generación, los resultados en términos de ganancias y pérdidas fueron distintos según se tratara de un hombre o de una mujer y según si el trabajador perteneciera a estratos “altos” o “bajos”. Por otra parte, las simulaciones realizadas previeron diferentes escenarios, lo que permitió medir la sensibilidad del impacto a la opción por el artículo 8, la edad de jubilación, la evolución futura del salario real y de la tasa de interés.

Aspectos metodológicos de la estimación de la curva salarial

Como el país no cuenta con información que permita reproducir los salarios sobre los cuales se realizaron los aportes y calcularon las pasividades hasta el año 1995, los estudios comprendidos en el proyecto “Los efectos macroeconómicos de la reforma de la seguridad social” requirieron previamente estimar el perfil de remuneraciones a lo largo del ciclo de vida (curva salarial). En este Documento de Trabajo, se presenta los aspectos metodológicos referidos a la estimación salarial utilizada en dichos estudios, la cual se basó en información de corte transversal suministrada por la Unidad de Historia Laboral del Banco de Previsión Social. Existe además la posibilidad de trabajar con la información relevada por la Encuesta de Hogares del Instituto Nacional de Estadística. Por ello, en ese Documento, una comparación de distintas alternativas de estimación de la curva salarial con esta fuente de información. Se presenta además algunos resultados de los impactos macroeconómicos de la reforma obtenidos a partir de las curvas salariales alternativas, de forma de evaluar la sensibilidad de las simulaciones a la opción de dicha estimación de la curva.

Work history and the access to contributory pensions. The case of Uruguay.

Incomplete and highly fragmented work histories threaten to leave many contributors of the pension schemes in Latin America without the minimum pension guarantee or even without access to the ordinary pension. We propose a methodology to assess this risk, identify vulnerable groups and study potential determinants of the history of contributions using information from the work history records of the social security institutions. We apply this methodology to the largest social security institution of Uruguay, the Banco de Previsión Social, and show that the majority of contributors to this institution might not comply with the minimum number of years of contribution that is currently required to access an ordinary pension when they reach the retirement age.density of contributions, work history

Trade Openness and Gender in Uruguay: a CGE Analysis

In this paper we analyze the gender differentiated impacts of trade openness in Uruguay using a gender aware CGE model with endogenous labor supply and a home production function. We simulate complete trade liberalization and an increase in tariffs to the level of 1994. Trade liberalization increases female employment and wages, reducing the gender wage gap. These findings are consistent with Çagatay (2001) and Fofana et al (2003). The effect of trade openness on time distribution of workers is different by skills. Skilled workers, mainly women, reduce time spent in leisure and domestic work increasing labor supply. In contrast, unskilled workers increase leisure time, especially men. Trade openness leads to a more equitable distribution of time spent in domestic work. When there is a more imperfect substitution among genders in the home production function, women reduce more leisure time. The increase in tariff to the level of 1994 has the opposite results.trade openness, gender, general equilibrium model, home production, leisure, wage curve

Presentación de la política de exoneraciones de aportes a la seguridad social en Uruguay

In Uruguay, the payroll tax rates that take the form of mandatory contributions to the social security system paid by employers differ among industries. This is the result of different policies. Since the 1950s, the law has permitted exemptions based on three criteria: a) the “general interest”, which led to some firms enjoying discretional subsidies; b) to subsidize the employment of some specific groups; c) to smooth the consequences of adverse macroeconomic shocks on employment. In this document we present the norms about exemptions, we describe the characteristics of the subsidised jobs and we report the results of Uruguayan studies about the relation between payroll taxes and employment.payroll taxes