Inequality and social policy in Latin America: A new analytical framework

Peter Lloyd-Sherlock*

*Corresponding author for this work

Research output: Chapter in Book/Report/Conference proceedingChapterpeer-review


Across Latin America, overall state spending on social policies compares favourably to countries with similar levels of wealth located in other regions. A recent survey reported that social spending in Latin America accounted for 13 per cent of gross domestic product (GDP) in 2004, compared to 9 per cent in the Middle East/North Africa and 8 per cent in the emerging Asian economies (Clements et al., 2007). Despite Latin America’s general adherence to neo-liberal policy frameworks, official data show social spending as a share of GDP increased significantly over the past 15 years (ECLAC, 2007a). This large and resilient social expenditure reflects Latin America’s historical legacy as a region with high levels of state intervention in social welfare, roughly in accordance with Esping-Andersen’s social democratic welfare regime. It also reflects the relative strength of civil society organisations, particularly trade unions, in the region, which have been able to resist some aspects of neo-liberal restructuring. It might be expected that comparatively high levels of social spending would foster social equality in Latin America. In the case of Cuba, there is clear evidence that this has happened (Mesa-Lago, 2005). Elsewhere, the picture is different: as a region, Latin America remains characterised by extreme patterns of inequality of wealth, power and access to resources. A World Bank report observed that the Latin American country with least income inequality (Uruguay) was still more unequal than any Organisation for Economic Co-operation and Development (OECD) or Eastern European country (World Bank, 2003).1 There is evidence that inequality has deep historical roots in the region, dating back to colonial times. In much of the region, large-scale state welfare interventions have been in place for at least half a century, a substantial period of time in which to address established inequalities (Abel and Lewis, 2002). This chapter will argue that, rather than reduce socio-economic disparities, many welfare interventions have actually contributed to them. It shows that, historically, social policies have privileged richer groups, distributing resources away from the poor. The chapter also assesses whether recent developments in social policy, including the emergence of new cash transfer programmes, have led to more progressive social policy regimes.

Original languageEnglish
Title of host publicationThe Routledge Handbook of the Welfare State
EditorsBent Greve
Place of PublicationLondon
Number of pages10
ISBN (Electronic)9781136190230
ISBN (Print)9780415682923
Publication statusPublished - 4 Dec 2012
Externally publishedYes

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