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March 27, 2026IMF Working Paper0 citationsOpen Access

Understanding Decrease in Skilled Wage Premium in Latin America

Explaining Latin America’s Decreasing Skilled Wage Premium

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Authors

ABAlberto BeharInternational Monetary Fund

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Overview

Analyzes decreasing skilled wage premium in Latin America, revealing key influences of technical change.

Key Points

  • The aim is to explore the reasons behind the declining skilled wage premium in Latin America and the role of directed technical change.
  • Applied a modified demand-supply decomposition framework
  • Incorporated directed technical change in the analysis
  • Examined data from ten Latin American countries over multiple time periods
  • Directed technical change significantly influences wage premiums
  • Substitution effects remain important but are countered by DTC
  • Traditional demand shifts were skill biased, while adjusted shifts showed skill neutrality
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Cite This Study

Alberto Behar (2026) studied this question.

synapsesocial.com/papers/69c61ff615a0a509bde18579https://doi.org/10.5089/9798229040020.001
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