Essays on Human Capital and Inequality in Brazil

Abstract

This dissertation investigates how public policies and cultural transformations affect human capital development and socioeconomic trajectories across generations in Brazil. The first chapter examines the long-run intergenerational effects of Brazil’s 1990 trade liberalization, exploiting geographic variation in tariff reductions and pre-reform industrial composition to identify causal impacts. Children in regions more exposed to tariff cuts experienced persistent declines in educational attainment and adult earnings. A central finding is that these costs were distributed unequally: non-white individuals lost twice as much schooling as their white counterparts and faced earnings penalties roughly 70 percent larger, while men experienced earnings declines over three times larger than women. The evidence points to a reduction in parental income as the key transmission channel, with non-white households less able to sustain their children’s educational investments given lower baseline earnings and fewer formal labor protections. The second chapter examines the long-run socioeconomic effects of early exposure to Brazilian soap operas, using a cohort difference-in-differences approach that exploits the staggered rollout of Globo’s television network. Children exposed before age ten experienced lower educational attainment and reduced adult income. The results suggest that, while reduced fertility could in principle improve resource allocation per child, the negative effects of greater family instability associated with higher divorce rates outweighed those potential gains. Robustness checks support the validity of the findings and contribute to the discussion on the role of media in shaping the economic and social trajectories of new generations.