Social Policy and Inequality in Latin America: A Review of Recent Trends

Most Latin American countries have extensive social policies which absorb high levels of state spending. Despite this, Latin America continues to suffer from high levels of inequality in terms of income and access to basic services. This article explores this apparent paradox. It focuses on three aspects of social policy in the region: patterns of resource allocation, the distribution of welfare entitlements and differing capacities to take advantage of these entitlements. It applies this framework to study the distributional effects of education, health and social security policies, paying particular attention to recent changes and developments. The article shows that these three factors combine in various ways to benefit higher-income groups and exclude the poor. Recent changes have marginally improved provision for low-income groups, but the fundamentally inegalitarian nature of social policy in the region remains largely unchanged and unchallenged.