Abstract

Inequality is a multidimensional phenomenon. The studies of inequality tend to concentrate on the analysis of income inequality but inequalities arise due to other economic, social and political factors. The objective of this paper is to evaluate the role of social inequality in Latin American countries and its relationship with the economic development. Principal component analysis is applied to estimate an indicator of social inequality. Empirical evidence confirms the correlation between social inequality and official economy follows Kuznets' hypothesis of inverted-U curve.