Labor market and crisis: an analysis of sectoral segmentation in Brazilian rural

Gabriela Gomes Mantovani,Carlos Alves Do Nascimento,Jefferson Andronio Ramundo Staduto

doi:10.1590/1806-9479.2021.249112

Abstract

Abstract: The article aims to analyze which factors contributed to the inequality across income distribution of Brazilian workers in rural areas, occupied in agricultural and non-agricultural activities. Quantile regression with sample selection bias correction and counterfactual decomposition of income by quantiles were applied, using the microdata from the National Continuous Household Survey (PNAD-C) for the years 2012 and 2019. The results showed that there is income inequality favorable to workers occupied in non-agricultural activities concerning agricultural activities, which is intensive for those with lower incomes, as well as for those with high incomes. The presence of sectorial segmentation was also confirmed, of which the largest portion in 2012 corresponds to the labor market duality. However in 2019, in lower quantiles the segmentation obtained greater explanatory power for the difference in income between the groups, while in higher quantiles the theory of human capital prevailed.

Highlights

The Brazilian rural areas in the last five decades have undergone intense social and economic transformations, led by the modernization process of the agricultural sector (Kageyama, 1990; Gasques & Villa Verde, 1990)
In Brazil in 2019, 50% of the rural income was made up of income from agricultural activities, and the other half came from non-agricultural activities (Instituto Brasileiro de Geografia e Estatística, 2019)
The central objective of the article is to analyze which factors contributed to the inequality across income distribution between agricultural and non-agricultural workers residing in rural areas of Brazil, and how the evolution of sectorial segmentation in the Brazilian rural area occurred for these activities in the years 2012 and 2019

Summary

Introduction

The Brazilian rural areas in the last five decades have undergone intense social and economic transformations, led by the modernization process of the agricultural sector (Kageyama, 1990; Gasques & Villa Verde, 1990). The sectoral policies of agriculture modernization were fundamental to the countless changes in the sector in Brazil and contributed to the country’s economic development through the generation of surplus production for the domestic market and exports, as well as the national territory occupation by expanding agricultural borders and boosting inland cities far from large urban centers. This agricultural modernization process has profoundly changed the technical basis of Brazilian production, transforming the country at the beginning of this century into a major player in international trade as an exporter of agricultural and agro-industrial products, because the country has increased competitiveness in various production chains. In Brazil in 2019, 50% of the rural income was made up of income from agricultural activities, and the other half came from non-agricultural activities (Instituto Brasileiro de Geografia e Estatística, 2019)

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Results