globalization and the role of public transfers in redistributing income in latin america and the caribbean

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08-09-2022
Social Studies

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globalization and the role of public transfers in redistributing income in latin america and the caribbean

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tutorconsortium203 tutorconsortium203 · Answer 1 · 2022-09-12T22:13:59+02:00

As a result of globalization as well as the role of public transfers in redistributing income in Latin America and the Caribbean, public transfers can be effective tools for redistributing income to the poor.

What is redistributing income?

If done correctly, income redistribution will reduce poverty by reducing inequality. However, it may not significantly accelerate growth, except perhaps besides reducing social tensions caused by inequality and enabling poor people to spend more money to human and physical capital formation.

The role of public transfers in redistributing income and globalization in Latin america and the Caribbean are as follows-

The redistributive authority of 56 transfers in 8 countries is assessed using simulations of their effects on poverty and inequality, as well as their distributional characteristics.
According to studies, public transfers could be effective tools for redistributing income to the poor.
However, this is not always the case. In some countries, the redistributive effects of social insurance are limited, if not regressive.
This is caused by two design factors: a reduction in coverage due to membership requirements in formal labor markets, which exclude the most of of the poor, and extremely generous unit advantages for those in the upper quintiles.
The more latest emergence of social support only partially compensates for the region's historical truncation of public transfers.

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