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<p>Income inequalities constitute visible manifestations of differences in living standards within each country. High levels of income inequalities indicate a waste of human resources in the form of a large share of the population being without work or relegated to low-paid and low-skilled jobs. The term income inequality, either measured by income or wages, is an important topic that has been continuously debated among academics and the media. Since the 1980s, most countries in the world experienced an increase in wage inequality and for some countries this trend continued during the 1990s. Mexico was no exception and went through a period of increasing inequality by the end of the 1980s. However, wage inequality in Mexico started to decline after 1994, the period after NAFTA was enacted. Although Mexico still seems to be experiencing inequality, the post-NAFTA period of 1998 to 2006 saw a decline in income inequality. Finding the reasons for the decline in income inequality during this period in Mexico is important because societies generally value a more democratic distribution of resources. Hence, the example of Mexico can be useful to other countries that are eager to reach lower inequality levels and overcome poverty.
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<br>Subjects: Mexico; income inequality; NAFTA; Gini coefficient</div>
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Aybar, Celil</div>
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