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The Age-Old Problem of Old Age Poverty in Portugal

  • Carlos Farinha Rodrigues
  • Isabel Andrade

The Portuguese elderly poverty rate has decreased significantly in recent years as elderly incomes have increased, and inequality and material deprivation levels have converged to their national levels. This paper investigates whether this improved situation is widespread across the elderly, but concludes that it is heterogeneous with poverty pockets subsisting. In particular, the elderly aged 75+ and living alone record a poverty rate above 30% in 2010, implying that this group remains one of great economic and social vulnerability. An important feature of this heterogeneity is the difference between the higher average income of the younger elderly generations versus the older ones, with more than 16% of the elderly in the two highest deciles of the income distribution in 2010. The evolution of both contributive and means-tested pensions is a key element in the reduction in elderly poverty and in the improvement in their living standards. However, the austerity policies implemented post-2010 have made a strong impact on pensions and can reverse this recent evolution.

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Paper provided by ISEG - School of Economics and Management, Department of Economics, University of Lisbon in its series Working Papers Department of Economics with number 2013/27.

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Date of creation: Dec 2013
Date of revision:
Handle: RePEc:ise:isegwp:wp272013
Contact details of provider: Postal: Department of Economics, ISEG - School of Economics and Management, University of Lisbon, Rua do Quelhas 6, 1200-781 LISBON, PORTUGAL
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  1. Carlos Farinha Rodrigues & Isabel Andrade, 2012. "Monetary Poverty, Material Deprivation and Consistent Poverty in Portugal," Notas Económicas, Faculdade de Economia, Universidade de Coimbra, issue 35, pages 20-39, June.
  2. Guio, Anne-Catherine & Fusco, Alessio & Marlier, Eric, 2009. "A European Union Approach to Material Deprivation using EU-SILC and Eurobarometer data," IRISS Working Paper Series 2009-19, IRISS at CEPS/INSTEAD.
  3. Lindquist, Gabriella Sjögren & Wadensjö, Eskil, 2012. "Income Distribution among those of 65 Years and Older in Sweden," IZA Discussion Papers 6745, Institute for the Study of Labor (IZA).
  4. Aziz, Omar & Gemmell, Norman & Laws, Athene, 2013. "The Distribution of Income and Fiscal Incidence by Age and Gender: Some Evidence from New Zealand," Working Paper Series 2852, Victoria University of Wellington, Chair in Public Finance.
  5. Robert L. Brown & Steven G. Prus, 2006. "Income Inequality over the Later-Life Course: A Comparative Analysis of Seven OECD Countries," Social and Economic Dimensions of an Aging Population Research Papers 154, McMaster University.
  6. Paula Albuquerque & Manuela Arcanjo & Vítor Escária & Francisco Nunes & José Pereirinha, 2010. "Retirement and the Poverty of the Elderly: The Case of Portugal," Journal of Income Distribution, Journal of Income Distribution, vol. 19(3-4), pages 41-64, September.
  7. Kees Goudswaard & Olaf van Vliet & Jim Been & Koen Caminada, 2012. "Pensions and Income Inequality in Old Age," CESifo DICE Report, Ifo Institute for Economic Research at the University of Munich, vol. 10(4), pages 21-26, December.
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