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The effects of social pensions on mortality among the extreme poor elderly

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  • Jose Valderrama
  • Javier Olivera

Abstract

We study the effects of Peru’s social pension programme Pension 65 on mortality. The programme provides a lifetime pension equivalent to 32 US dollars per month to individuals aged 65 and older who do not have other pensions and are officially classified as extreme poor. The analysis relies on survey data obtained at the baseline, which we match to mortality records for the period 2012 to 2019. We exploit the discontinuity around the welfare index used by the programme to determine eligibility, and estimate intention-to-treat effects in a regression discontinuity setting. We find that after seven years, the programme can reduce mortality among eligible people by about 11.4 percentage points. The programme could also increase the life expectancy of eligible people by one year. The results and back-of-the-envelope calculations indicate that the policy is cost effective.

Suggested Citation

  • Jose Valderrama & Javier Olivera, 2023. "The effects of social pensions on mortality among the extreme poor elderly," LISER Working Paper Series 2023-05, Luxembourg Institute of Socio-Economic Research (LISER).
    • Handle: RePEc:irs:cepswp:2023-05
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    More about this item

    Keywords

    non-contributory pensions; mortality; regression discontinuity; old-age poverty;
    All these keywords.

    JEL classification:

    • H55 - Public Economics - - National Government Expenditures and Related Policies - - - Social Security and Public Pensions
    • I38 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Government Programs; Provision and Effects of Welfare Programs
    • J14 - Labor and Demographic Economics - - Demographic Economics - - - Economics of the Elderly; Economics of the Handicapped; Non-Labor Market Discrimination

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