Who are society’s most vulnerable in Latin America?
If we talk about poverty, it is important to remember it’s not just poor households that are vulnerable in Latin America, but also the non-poor who have a high risk of becoming poor. In the case of Peru, our research has found that this vulnerability is structural: the high income instability of the primary sector and informal microenterprises in urban areas; levels of education; ethnicity; the demographics of the household, and the geographic surroundings. These factors define an individual’s productive opportunities, and reflect the presence of the state. As such, 30% of Peru’s total population, and almost 50% of its non-poor population, should be considered as being vulnerable to poverty.
Why does Latin America remain the most unequal region in the world?
An important factor that could explain the high level of inequality in the region is the role of the public sector. If you look at levels of domestic inequality before taxes, using the Gini coefficient, Latin American countries perform quite similarly to European countries (see the graph below). The role of the public sector here is crucial in reducing levels of inequality, by providing welfare to the less advantaged in society in the form of direct cash transfers, or via public services (education, health services etc.)
