Inequality, social capital, and varieties of capitalism in Latin America

Abstract

This paper aims to research whether the varieties of capitalism impact the relationship between social capital and inequality in developed economies (coordinated and liberal economies) and Latin America (hierarchical economies) in the period from 2000 to 2016. To do that, the study uses a panel analysis of developed economies and Latin America, that is, a fixed effect panel static analysis. The model includes one dependent variable (Gini index) and ten independent variables (generalised trust, informal economy, years of schooling, union density, market capitalization, annual gross domestic product, gross domestic product per capita, health expenditure, feminine labour force, and gross capital). The findings show that the relationship between inequality and social capital is negative and significant and that hierarchical economies (Latin America) amplified such a relationship.