Income Inequality in Brazil: Is Education Quality an Important Determinant?

This paper examines the contribution of education quality to income inequality in Brazil. More specifically, I look at the average income of municipalities in Brazil to observe how much the disparities in education quality across municipalities account for income inequality. Three commonly used methods to study income inequality are implemented: decomposition by population subgroups, a regression-based approach and the Oaxaca-Blinder decomposition. Using different measures for education quality, I find that the provision of a good measured education among public schools contributes little to the variation of average income across municipalities.