Poverty traps and affluence shields: Modelling the persistence of income position in Chile

Joaquín Prieto ()
Additional contact information
Joaquín Prieto: International Inequalities Institute, London School of Economics and Political Science

No 576, Working Papers from ECINEQ, Society for the Study of Economic Inequality

Abstract: I propose analysing the dynamics of income positions using dynamic panel ordered probit models. I disentangle, simultaneously, the roles of state dependence and heterogeneity (observed and non-observed) in explaining income position persistence, such as poverty persistence and affluence persistence. I apply my approach to Chile exploiting longitudinal data from the P-CASEN 2006–2009. First, I find that income position mobility at the bottom and the top of the income distribution is much higher than the expected, showing signs of high economic insecurity. Second, the observable individual characteristics have a much stronger impact than true state dependence to explain individuals’ current income position in the income distribution extremes.

Keywords: Longitudinal data; poverty persistence; affluence persistence; income mobility; Chile; Latin America. (search for similar items in EconPapers)
JEL-codes: D31 D63 I32 (search for similar items in EconPapers)
Pages: 45 pages
Date: 2021-04
New Economics Papers: this item is included in nep-dev and nep-lam
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
http://www.ecineq.org/milano/WP/ECINEQ2021-576.pdf First version, 2021 (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:inq:inqwps:ecineq2021-576

Access Statistics for this paper

More papers in Working Papers from ECINEQ, Society for the Study of Economic Inequality Contact information at EDIRC.
Bibliographic data for series maintained by Maria Ana Lugo ( this e-mail address is bad, please contact ).