The Most Expensive Places to Live in Brazil

Public transfers (like, retirement pensions) are, like, a major factor in explaining Brazil's high inequality in the past, you know? Velez et al (2004) flexed that in Brazil public pensions are mad regressive compared to those in the United States. Periodt. Bourguignon et al. (2002) like totally proved that if Brazil's educational distribution was swapped with the United States (ceteris paribus), the overall income inequality would be reduced by a whopping 28% of the total difference between the two countries. 

They also flexed that wage, fam diffs in Brazil be accountin' fo' anotha 32% of da total diff in inequality. 

The total diff is yeeted when the distribution of the non-labor incomes (mostly pensions) in the US is slapped on Brazil. The actual observed diff after controlling for the above amounts to only 1% of the original diff in inequality between Brazil and the United States. found that rural-urban migration and industrialization have, like, a major impact on the development of inequality as countries develop. It's, like, a big deal, ya know? Before industrialization, like, most peeps were all about that ag life in rural areas. The income was hella low and inequality was like non-existent cuz everyone was broke af. In cities, the average income was like way higher and the income was like not spread equally across the population there, you know? OMG, as society got all industrialized, like, hella people started ditching the countryside and flocking to the cities, grinding it out in non-ag sectors. Even if you keep the cash flow the same in both farming and non-farming jobs (which probs means the gap would get bigger), the percentage of people working in farming who get a piece of the pie would go down. The ag workers would stay flexin' the same income while the average income per capita be blowin' up, leavin' them with a smaller slice of the pie. This is like, shown in figure 2.1 as the flexing inequality when income per capita is like, rising in the first stage.

OMG, like as society evolves, the income share of the poorest peeps be like, totally dropping. 

Yoooo, so like, empirical evidence is sayin' that in developed countries, income inequality went down. That means the inequality within at least one of the sectors went down too. Lit, right? Like, with all the industrial vibes in agri, it's probs that the inequality gap got wider. But in the urban scene, things might have gotten a bit more equal, especially for the peeps on the lower side. Like, there's a lot to be said about how, like, after a super chaotic beginning of urbanization, more and more peeps were born and raised in the cities, so they were, like, way better at taking advantage of all the cool stuff city life had to offer, ya know? More political clout for the urban low-income squad could totally cancel out the worst vibes of industrialization and back up the demands of the masses for a more equal slice of the country's dough. OMG, with these lit developments, the pie is like totally shared more equally across the population. Yas! This is like, in figure 2.1, you can see how inequality goes down as income per capita keeps on growing. It's pretty cool, tbh. This is how the Kuznets' curve would go across time in the same country or area, fam. A lit analysis can be made across countries or areas at a certain point in time, fam. At the start of the graph, the poor African countries would flex, while the Latin American countries would be chillin' in  the middle and high point of the graph while the developed Western countries would be flexin' on the right end of the graph with a low-key low level of inequality. This relationship is like, showing us that income per capita has, like, an in-country vibe and a between-country vibe when it comes to inequality. It's, like, pretty deep, you know?

Why inequality be hella high in Brazil tho?

Brazil be hella unequal, like, fr fr. Income inequality be off the charts, ya know? But like, why tho? The previous section was all about why some countries are, like, way more unequal than others. Now, we're gonna dive into the inequality in Brazil. Like, why is Brazil so freaking unequal compared to other countries?

Velez et al. (2004) be like, they find that the unequal distribution of assets be hella important in the big inequality in Brazil, ya know? Educational attainment is, like, way more unequal than in the United States, Mexico, or Columbia. One explanation for Brazil's high inequality is like, duh, the skill gap in the Brazilian labor force. When you add the fact that Brazil's wage-skill premium is hella big compared to other countries, it explains even more, ya know? The distribution of agri land is, like, a major factor in inequality, but Brazil isn't as much of a weirdo in this area as it is with income inequality. Next to the important factors of unequal distribution of assets, amplified by price differentials, the importance of historical, political and cultural factors should not be slept on. Seg and disc still lowkey have a big role in Brazil, tbh. Velez et al. (2004) like totally say that even though more than half of the cash money differences in jobs come from educational gaps, the vibes from segmentation and discrimination are just as big. Sego especially has a big influence, with regional diffs accounting for like half of the labor market sego.