Raymundo Campos Vazquez Presents His Latest Book on Inequality in Mexico
On May 3, the Georgetown Americas Institute (GAI) hosted a conversation with Raymundo Vazquez Campos, professor at El Colegio de México in Mexico City, who presented his recent book Inequalities: Why a More Equal Country Benefits All (2022).
Throughout Latin America and the Caribbean, the uneven distribution of wealth has long presented challenges for economic development and democratic stability. To discuss Mexico’s experience with inequality and how it has stifled the country’s growth, GAI hosted Raymundo Campos Vezquez, who recently published a book on this pressing topic. Nora Lustig, Samuel Z. Stone Professor of Latin American Economics and founding director of the Commitment to Equity Institute (CEQ) at Tulane University, and GAI Founding Director Alejandro Werner also joined the conversation to discuss the book and its themes.
Why Inequality Matters
“The book argues that while many believe that inequality is a problem of envy it is actually a very serious challenge that threatens all of society.” -Raymundo Campos Vazquez
The focus of the book, inequality, is a societal challenge that affects the entirety of Mexico. Rich and poor alike are both affected by the country’s internal wealth gap as the country struggles to develop; countries with greater inequality suffer significantly higher anxiety levels.
The state has a clear role to play in tackling this issue, and the book reflects on what balance should be reached between the state and the market to create an environment that reduces inequality.
“In economic terms, the evidence clearly shows that excessive inequalities threaten the potential and stability of growth and the reduction of poverty.” -Raymundo Campos Vazquez
In Mexico, studies have shown that the wider population believes that the country is deeply unequal and wishes for greater equality. The Gini coefficient measures a country’s inequality: the lower the coefficient, the more equal a country is. Popular perception is that Mexico has a Gini coefficient of 0.56, while people wish that number was around 0.31. In reality, Mexico’s official 2020 coefficient was 0.45, while the latest number for Canada was 0.32.
Implications for Mexico
Inequality is deeply tied to social mobility and an individual’s chances of rising out of poverty. For example, Canada’s mobility from the lowest to the highest income quartile is over five times greater than Mexico’s. Among the poorest 20% of people in Mexico, only 2.6% make it to the highest income segment, resulting in extremely low upward social mobility.
“The people of Mexico know very well that we live in a deeply unequal society.” -Raymundo Campos Vazquez
This dynamic clearly sets Mexico apart from the rest of North America, where the United States and Canada have much more economically mobile societies. These inequalities also have subnational implications that are tied to development gaps between the country’s regions. The book shows that Mexico has clear internal geographic differences: people born in the south are significantly less likely to increase their socioeconomic status when compared to those living in the more industrialized north.
Mexico is also a very unique case study for Latin America because of its relatively weak welfare system compared to countries like Argentina and Brazil.
Lustig commented that Mexico has many challenges tied to inequality. As an example, the country’s billionaire wealth is significantly tied to “crony sectors,” while the state’s social spending as a share of GDP is very small by regional standards. Similarly, Werner argued that this book goes to the very center of the discussion and asks a valuable question: what kind of society is it that we want? Clearly Mexicans want a more equal society, but more needs to be done to figure out how the country will get there.
This event was co-sponsored by the GAI and the Centro de Estudios Espinosa Yglesias; it was moderated by GAI Founding Director Alejandro Werner.
The event was held in Spanish with English interpretation. A full recording of the event in Spanish is available on the GAI YouTube channel.