Brazil 2021 data update: Methodological adjustments to the World Bank’s poverty and inequality estimates

There is evidence of significant under-coverage of the "Auxilio Emergencial" program in Brazil’s Continuous National Household Sample Survey (PNADC in Portuguese) 2021. The program, originally launched as an emergency measure by the Government of Brazil to support families during the pandemic, covered over 68 million individuals in 2020. The previous PNADC 2020 only observed about 20 million, and an approach to impute AE beneficiary status was applied to complement the observed AE status and better capture households’ welfare. A new version of the AE program was launched in 2021. AE in 2021 covered 36 million, while the PNADC 2021 only observed 8 million. An adjustment that incorporates the eligibility criteria of AE 2021 is implemented in the calculation of households’ income and poverty rates. The imputation method described here is included in the World Bank’s poverty and inequality estimates for Brazil 2021 (published in March 2023). The poverty estimates in 2021 are 28.4 percent at the US$6.85 poverty line and 5.8 percent at the US$2.15 line. The Gini coefficient is estimated at 0.526. A set of robustness checks shows qualitatively similar results.