Peripherality, income inequality, and economic development in Latin American countries

Following a neo-structuralist perspective, this study presents development puzzle for Latin American countries (LACs): triangular relation amongst peripherality (increased terms-of-trade volatility and technological backwardness), income inequality, per-capita income. We employ simultaneous equation model using three-stage least squares (3SLS) to analyse relation. find that decrease in inequality an increase were mutually reinforcing 14 LACs between 1995 2014. Although progress increases income, it partly mitigates by increasing inequality. Additionally, the effects of foreign sources technology, including direct investment (FDI), on are mitigated with higher capabilities. While improvement commodity expectedly decreases South countries, their is mostly insignificant.