The Changing Patterns of Inclusion and Exclusion

CHAPTER 1 | Outsiders?

Social exclusion evolved and changed as much as societies did with the re-establishment of democracy in the mid-1980s. Exclusion has become more urban and visible and is at the source of a growing sense of disengagement and dissatisfaction that affects wide segments of the population, creating a fertile ground for populist experiments that erode the economic, social, and political institutions of democracy.

CHAPTER 2 | Traditional Excluding Forces: A Review of the Literature

The outcomes of exclusion have traditionally been understood as the product of stigma and discrimination that target groups easily identifiable by their racial, ethnic, and gender identity. This chapter reviews an extensive body of literature that documents the relative and multidimensional deprivation that the excluded suffer as a consequence of their lack of access to the institutions and resources with which those in the mainstream obtain outcomes valuable in a market economy.

CHAPTER 3 | Discrimination in Latin America: The Proverbial Elephant in the Room?

Conventional wisdom holds that the multiple deprivations suffered by traditionally discriminated-against groups (indigenous peoples, Afro-descendants, and women) are the product of overt discrimination. The results of a set of highly controlled economic experiments suggest that substantial differences in endowments associated with race, ethnicity, or gender, rather than discrimination, explain these differential outcomes. Recognizing the difference between these two concepts is crucial for the design of effective antidiscrimination policies.

CHAPTER 4 | State Reform and Inclusion: Changing Channels and New Actors

Democratization, macro stabilization, and globalization have drastically changed the way the state functions and have altered the channels of social, political, and economic inclusion that a truncated version of the welfare state provided to a fortunate few. These modern forces of inclusion and exclusion interact with traditional excluding forces and have made larger and more diverse segments of the population more vulnerable to social exclusion.

CHAPTER 5 | Bad Jobs, Low Wages, and Exclusion

The labor market is one of the social loci where modern exclusionary forces (largely economic and social in origin) have expanded, both in magnitude and scope, the impact of social exclusion. Rising unemployment, mediocre levels of growth, and an increasing demand for education have increased the share of low-wage employment in the region in the last decade and a half.

CHAPTER 6 | Social Mobility and Social Exclusion

Latin America and the Caribbean has the greatest income inequality of any region in the world. Individuals at the bottom of the income distribution are unlikely to see significant improvement in their social position or that of their children, regardless of effort or ability. Conversely, those fortunate few in the upper echelons of the income distribution show little downward mobility, again regardless of effort or ability.

CHAPTER 7 | To What Extent Do Latin Americans Trust and Cooperate?
Field Experiments on Social Exclusion in Six Latin American Countries

The results of a set of highly controlled social experiments in six Latin American capital cities suggest that Latin Americans do trust and cooperate, but that exclusion, by increasing social distance and heterogeneity, reduces incentives to cooperate. Welfare losses of between 22 and 72 percent relative to what could have been obtained under full cooperation were observed in the experimental setting. Though these values should not be interpreted as actual GDP losses, they are indicative of the important economic consequences of social exclusion.