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Cash Transfer Programmes in Brazil: Impacts on Inequality and Poverty

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Author Info

  • Fabio Veras Soares

    () (International Poverty Centre)

  • Sergei Suarez Dillon Soares

    () (Institute of Applied Economic Research (IPEA))

  • Marcelo Medeiros

    () (International Poverty Centre)

  • Rafael Guerreiro Osório

    () (International Poverty Centre)

Abstract

This paper evaluates the contribution of cash transfer programmes to the observed fall in inequality in Brazil between 1995 and 2004 as well as its impact on poverty. We use the 2004 Brazilian National Household Survey (PNAD) that for the first time collected data on the incidence of some of the cash transfer programmes. We develop a methodology to separate out the income of different cash transfer programs, cross-check the survey information with administrative records, evaluate the incidence of the programmes, calculate their concentration indexes and decompose the Gini index into the contribution of each income source. We find that both BPC ? the means tested old age pension and disability grant programme ? and Bolsa Família are quite well targeted: 74% of BPC reported income and 80% of Bolsa Família reported income goes to families living below the poverty line (half of minimum wage per capita), and that they were jointly responsible for 28% of the fall in the Gini inequality between 1995 and 2004 (7% from BPC and 21% from Bolsa Família). This contribution is quite sizable since BPC and Bolsa Família together account for a tiny 0.82% of the total family income reported in the National Household Survey. It is also striking that pensions equal to the minimum wage ? contributory or not ? contributed 32% to the fall in the Gini index, but this better performance was due to the fact that they make up 4.6% of the total family income.

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File URL: http://www.ipc-undp.org/pub/IPCWorkingPaper21.pdf
File Function: First version, 2006
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Bibliographic Info

Paper provided by International Policy Centre for Inclusive Growth in its series Working Papers with number 21.

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Length: 35
Date of creation: Jun 2006
Date of revision:
Publication status: Published by UNDP - International Poverty Centre, June 2006, pages 1-35
Handle: RePEc:ipc:wpaper:21

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Keywords: distribution; Cash tranfer programmes; Poverty;

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References

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  1. Nanak Kakwani & Marcelo Neri & Hyun H. Son, 2006. "Linkages between Pro-Poor Growth, Social Programmes and Labour Market: The Recent Brazilian Experience," Working Papers 26, International Policy Centre for Inclusive Growth.
  2. Marcelo Medeiros & Debora Diniz & Flávia Squinca, 2006. "Cash benefits to disabled persons in Brazil: An analysis of the BPC ? Continuous Cash Benefit Programme," Working Papers 16, International Policy Centre for Inclusive Growth.
  3. Marcelo Medeiros & Debora Diniz & Flávia Squinca, 2006. "Cash Benefits to Disabled Persons in Brazil: an analysis of BPC - continuous cash benefit programme," Discussion Papers 1184, Instituto de Pesquisa Econômica Aplicada - IPEA.
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Citations

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Cited by:
  1. Barrientos, Armando, 2011. "On the Distributional Implications of Social Protection Reforms in Latin America," Working Papers UNU-WIDER Research Paper , World Institute for Development Economic Research (UNU-WIDER).
  2. Kalie Pauw & Liberty Mncube, 2007. "Expanding the Social Security Net in South Africa: Opportunities, Challenges and Constraints," Country Study 8, International Policy Centre for Inclusive Growth.
  3. Francisco H. G. Ferreira & Anna Fruttero & Phillippe Leite & Leonardo Lucchetti, 2011. "Rising food prices and household welfare: Evidence from Brazil in 2008," Working Papers 200, ECINEQ, Society for the Study of Economic Inequality.
  4. KUMARA, Ajantha Sisira & PFAU, Wade Donald, 2010. "IMPACT of Cash Transfer Programs on School Attendance and Child Poverty: An Ex-ante Simulation for Sri Lanka," MPRA Paper 30501, University Library of Munich, Germany, revised 11 Aug 2010.
  5. Ricardo N. Bebczuk, 2008. "Financial Inclusion in Latin America and the Caribbean: Review and Lessons," CEDLAS, Working Papers 0068, CEDLAS, Universidad Nacional de La Plata.
  6. Jones, Nicola & Nguyen, Ngoc Anh & Nguyen, Thu Hang, 2007. "Trade liberalisation and intra-household poverty in Vietnam: a q2 social impact analysis," MPRA Paper 4206, University Library of Munich, Germany.
  7. Eduardo Zepeda & Diana Alarcón González & Fabio Soares & Rafael Osorio, 2007. "Growth, poverty and the distribution of labor earnings in Brazil, Chile and Mexico," IDB Publications 10698, Inter-American Development Bank.
  8. Niño-Zarazúa, Miguel, 2011. "Mexico’s Progresa-Oportunidades and the emergence of social assistance in Latin America," MPRA Paper 29639, University Library of Munich, Germany.
  9. Ferreira, Francisco H. G. & Leite, Phillippe G. & Ravallion, Martin, 2007. "Poverty reduction without economic growth ? explaining Brazil's poverty dynamics, 1985-2004," Policy Research Working Paper Series 4431, The World Bank.
  10. Julia Johannsen, 2006. "Operational Poverty Targeting In Peru ? Proxy Means Testing With Non-Income Indicators," Working Papers 30, International Policy Centre for Inclusive Growth.
  11. Eduardo Zepeda & Diana Alarcón & Fabio Veras Soares & Rafael Guerreiro Osório, 2007. "Growth, Poverty and Employment in Brazil, Chile and Mexico," Working Papers 42, International Policy Centre for Inclusive Growth.
  12. Fabio Veras Soares & Rafael Perez Ribas & Rafael Guerreiro Osório, 2007. "Evaluating the Impact of Brazil?s Bolsa Família: Cash Transfer Programmes in Comparative Perspective," Publications 1, International Policy Centre for Inclusive Growth.
  13. Hoffmann, Rodolfo & Oliveira, Regis Borges de, 2012. "The evolution of income distribution in Brazil: different characteristics of the agricultural sector," 2012 Conference, August 18-24, 2012, Foz do Iguacu, Brazil 127673, International Association of Agricultural Economists.
  14. Eduardo Zepeda & Diana Alarcón & Fabio Veras Soares & Rafael Guerreiro Osorio, 2009. "Changes in Earnings in Brazil, Chile, and Mexico: Disentangling the Forces Behind Pro-Poor Change in Labour Markets," Working Papers 51, International Policy Centre for Inclusive Growth.
  15. Fabio Veras Soares & Rafael Perez Ribas & Rafael Guerreiro Osório, 2007. "Avaliando o Impacto do Programa Bolsa Família: Uma Comparação com Programas de Transferência Condicionada de Renda de outros Países," Publications Portuguese 1, International Policy Centre for Inclusive Growth.
  16. Nguyen, Anh & Jones, Nicola, 2006. "Vietnam’s Trade Liberalisation: Potential Impacts on Child Well-being," MPRA Paper 1385, University Library of Munich, Germany.
  17. Claudio Frischtak & Benjamin R. Mandel, 2012. "Crime, house prices, and inequality: the effect of UPPs in Rio," Staff Reports 542, Federal Reserve Bank of New York.
  18. M�nica A. Haddad, 2008. "Bolsa Fam�lia and the needy: is allocation contributing to equity in Brazil?," Journal of International Development, John Wiley & Sons, Ltd., vol. 20(5), pages 654-669.

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