Inequality in Brazil: measurement, trends, impacts and policies Marcelo Neri Strategic Affairs (SAE/PR) and EPGE/FGV Wider, Helsinki, September 2014
Script Overview: The Middle Path Inequality: Trends, Causes and Impacts Per Capita Household Income - Various Surveys Interactions with Growth, Perceptions & Assets Residential Capital & Personal Income Tax (PIT) Public Policies Agenda: Bolsa Família (CCT)
Percentile of the World Income Distribution Income Distribution Relative to the World Brazilian Per Capita GDP (PPP) is 93.7% of the World GDP in 2012 100 90 US 80 70 60 50 40 Russia Brazil China India 30 20 10 Source: Milanovic (2011) 1 1 25 50 75 100 Each Country
Gini Coefficient Brazil is a small World.75 China Effect Brazilian Per capita GDP PPP has grown 3.5% agains 3.6% of the world between 2002 e 2012 Chindia Effect.65 Inequality Across Nations.55.45 0.535 1950 1960 1970 1980 1990 2000 2009 2001 2011 Year Source: Milanovic (2011) and Neri (2011) 0.581 0.589 0.607 0.594 0.539 0.527 Falling in Brazil but still the 18th highest in 155 countries.
Inequality Within Municipalities Gini Index of Per Capita Income by Municipality - 2000 2000 Source: Demographic Census/IBGE microdata
Inequality within Municipalities Gini Index of Per Capita Income by Municipalities - 2010 Inequality fell in 80% of the 5500 Brazilian Municipalities 2010 Source: Demographic Census/IBGE microdata
% Population with Income Below U$ 1.25 per day PPP Brazil: Middle of the World Source: IPEA / SAE from PNUD
% Population with Income Below U$ 1.25 per day PPP A World within Brazil Source: IPEA / SAE from the Demographic Census/IBGE
What explains + Social Inclusion? Growth or + Equity? 1 st MDG: Extreme Poverty Line (U$S 1,25 a day PPP) fell 69% in 10 years Component that Explains Proportion of Extremelly Poor % of Total Fall (69.3%) Income growth 50.5% Inequality Fall 49.5% Total 100 Dynamic Decomposition of Extreme Poverty Fall of 69.3% in Brazil Between 2002-2012 The Middle Path Brazil Main Target Source: IPEA/SAE from PNAD/IBGE microdata
New Middle Class: Evolution of Economic Classes Pyramid 2003-2014 A to E Classes Classes AB 14.1 Million AB Classes INCREASED 11 Mi 25.1 Million 29.5 Million Classe C 68.5 Million C Class INCREASED 42 Mi 110.5 Million 118.9 Million Classes DE 97.8 Million 63.5 Million 54.2 Million 2003 2012 2014* Source: CPS/FGV from PNAD/IBGE microdata * Forecast
% Evolution of ABC Classes (Traditional and New Middle Classes) 1993 1995 2014 (projection) % Classe ABC 1993 13.01-28.32 28.32-43.63 43.63-58.93 58.93-74.24 74.24-89.55 % Classe ABC 1995 13.01-28.32 28.32-43.63 43.63-58.93 58.93-74.24 74.24-89.55 % Classe ABC 2003 13.01-28.32 28.32-43.63 43.63-58.93 58.93-74.24 74.24-89.55 2003 % Classe ABC 2009 13.01-28.32 28.32-43.63 43.63-58.93 58.93-74.24 74.24-89.55 2009 % Classe ABC 2014 13.01-28.32 28.32-43.63 43.63-58.93 58.93-74.24 74.24-89.55 Source: Ipea from PNAD/IBGE microdata
1st Acquisition of Goods and Services 1st time acquiring goods or services: Among those who purchased it in the last 3 years 80% 74.80% 70% 64.57% 65.48% 60% 50% 46.19% 47.67% 49.49% 40% 30% 28.5% 33.61% 35.29% 37.21% 38.88% 20% 10% 0% Source: SAE desihned questions in SECOM Quarterly Public Perception Poll July/2014 *only takes into account the ones who adquired the good or service in the last 3 years
Inequality (Gini) Long Run Perspective Inequality of Per Capita Income (Gini) 62 0.607 6 0,58 0.581 0.589 0.594 0,56 0.552 0,54 0,52 0.535 0.539 0.526 0,5 0,48 1960 1970 1979 1990 2001 2007 2009 2012 Year Source: CPS;FGV from PNAD, PME and Census / IBGE microdata and Langoni (1973)
Cumulative Growth (%) 26% 33% 28% 41% 62% 57% 53% 47% 89% 85% 84% 79% 76% 74% 67% 99% 96% 114% 107% 138% Changes in Income Distribution 2001-2012 Cumulative Growth Rate of Per Capita Income by Vintiles 2001-2012(%) 140 120 Income of the 5% poorest has grown 550% faster than the 5% richest 100 80 60 40 20 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 5% 5% poorest Vintiles of Household Income - per capita richest Soucre: IPEA/SAE from PNAD/IBGE microdata
6.1 5.7 7.0 6.7 7.8 7.5 7.2 6.9 9.6 9.1 9.0 8.9 8.4 8.4 9.0 9.4 10.0 12.0 11.0 20.1 Income variation Between 2011 and 2012 Per Capita Household Income Variation by Vintiles (%) 20 Stability of the Gini in 2012: Has inequality stopped falling? 15 10 5 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 Vintiles of per capita household income 5%- 5%+ Source: SAE from PNAD/IBGE microdata
Income Inequality GINI Inequality index, March 2002 to March 2014 Per Capita Labor Earnings 6 Main Metrocities 0.64 0.62 0.60 0.58 0.56 Gini Moving Average 12 Months Only 4 MRs* Jan./14 55.4 Feb./14 55.3 Mar./14 55.2 April/14 55.1 May/14 55.0 June/14 54.9 July/14 54.8 0.54 2002 (Mar.) 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 (mar.) Source: IPEA/SAE from PME/IBGE (2002-2014) microdata *the table only covers SP, RJ, BH and Recife *Per Capita Household Labor Income - 15 to 65 Years 16
Income Inequality Theil-T Inequality index, March 2002 to March 2014 Per Capita Labor Earnings 6 Main Metrocities 0,90 0,85 0,80 0,75 0,70 0,65 Theil-T Moving Average 12 Months Only 4 RMs* Jan./14 60.7 Feb./14 60.5 Mar./14 60.2 April/14 59.9 May/14 59.7 June/14 59.4 July/14 59.3 0,60 0,55 2003 (Mar.) 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 (Mar.) Source: IPEA/SAE from PME/IBGE (2002-2014) microdata *the table only covers SP, RJ, BH and Recife *Per Capita Household Labor Income - 15 to 65 Years
Real Growth between 2003 and 2014 (%) Why Did It Fall? 2003-2014 Growth of Productive Attributes Increase in Productive Attributes between 2003* e 2014** (in percentage points) 18.84% 12.94% 12.88% 12.00% 7.49% 3.51% 11 or + completed years of schooling Professional Course Contributes to Social Security Formal Employees Firm with 11 or + Employees 2 Years or + in the Job Source: microdata from PME/IBGE. * between May 2002 and April 2003. ** between May 2013 and April 2014
Real Growth between 2003 and 2014 (%) Why Did It Fall? 2003-2014 Income Growth by Productive Attributes Real Income Growth by Productive Attributes between 2003* e 2014** (Growth rate annual) Total Mean 3.06% 1.914% 0.914% 1.220% 1.014% 1.474% 0.505% 11 or + completed years of schooling Professional Course Contributes to Social Security Formal Employees Firm with 11 or + Employees 2 Years or + in the Job Source: microdata from PME/IBGE. * between May 2002 and April 2003. ** between May 2013 and April 2014
Real Growth between 2003 and 2014 (%) Why Did It Fall? 2003-2014 Income Growth by Personal Attributes Increase in Income (%) by Personal Attributes between 2003* and 2014** (Growth rate annual) 4.2% 4.7% 4.1% 3.8% 3.8% Total Mean 3.06% Women Blacks Periphery Youth >5 people in the HH Source: microdata from PME/IBGE. * between May 2002 and April 2003. ** between May 2013 and April 2014
12.73 14.41 13.69 13.71 13.57 13.79 13.19 13.31 16.01 18.81 17.03 16.42 16.80 17.79 17.58 20.12 19.45 23.10 26.24 24.86 26.34 27.13 Idiossincratic Risk of Per Capita Labor Income Risk of Falling & Opportunity to Rise Across the Median in 12 months Panel Data The risk of crossing the median in an upward direction has never been so high: 27% of the people who were below the median crossed it in 2012/2013 inversion of the risks of falling/rising 10 years later 30 Source: IPEA/SAE from PME/IBGE longitudinal microdata 25 20 15 10 5 2002/ 2003 2003/ 2004 2004/ 2005 2005/ 2006 2006/ 2007 2007/ 2008 2008/ 2009 2009/ 2010 2010/ 2011 2011/ 2012 2012/ 2013 Despite having lower chances of rising, the less educated, since 2002/2003, increased the controled chances (Dif in Dif) compared to the more educated. The same happens in favour of the black people and in favor of the residents in the periphery.
Inclusive Development?: Interactions Equality Looking at the distribution among individuals and social groups of income flows, stocks of assets and rights. Sustainability (Assets) Ability to maintain the standards of living achieved. Stocks of human, environmental, physical, cultural and social assets. Prosperity (Growth) Growth in mean income and consumption (not only GDP/National Accounts but also look to Household Surveys data and PIT). Sensibility (Perceptions) The last dimension is subjective, based on people s percepction about the country, the public services and life quality.
How much did it grow? Prosperity Equality GDP X Mean Income PNAD X Median Income PNAD X 10% Poorest Real Per Capita 2003 = 100 210 190 170 Real differences are explained by the use of different deflators, in nominal terms mean growth rates are similar 180.78 165.88 206.17 178.4 150 140.69 151.7 130 110 127.70 127.8 90 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 Source: IPEA/SAE from PNAD/IBGE microdata and National Accounting/IBGE
hich source of income (program) ontributed the most to growth? 2001 2012 in annual percentage points. ontribution of Income Sources to Growth by Different Income Groups Mean 40% Poorest 5% Richest 10% Poorest Labor 2.75 4.27 1.99 2.97 Bolsa Família 0.10 0.83 0.00 3.29 BPC (Social Assistance) 0.06 0.28-0.06 0.16 Social Security 0.74 0.89 0.32 0.23 Other 0.00 0.11-0.02 0.14 Total 3.64 6.38 2.23 6.80
Shared Prosperity (Mean and Shared Bottom 40%) Determinants of the Gains in Real Per Capita Prosperity from 2001 and 2012 in annual percentage points 0.1 and 0.83 Bolsa Família Other 3.64 and 6.39 Total Effect 0.79 and 1.17 Social Security & BPC 0.55 and 1.00 Value of Education Labor 2.75 and 4.27 Wages and Profits 0.37 and -0.23 Quantity = Participation Rate + Unemployment + Hours 1.85 and 2.96 Educational Bonus
Average Years of Schooling Gini Index of Years of Schooling Education 9 8 MEAN AND GINI OF YEARS OF SCHOOLING Average and Gini Index of Years of Schooling in the Occupied and Paid Population Gini Index Sustainability 0.500 0.450 7 0.400 0.350 6 Average 0.300 5 Source: Ipea / SAE, from Pnads 1992, 2002, 2011 e 2012 microdata 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012 0.250 Still Bad Photo but Good Movie
Hong Kong Finlândia Coréia Holanda Liechtenstein Japão Canadá Bélgica Suíça Macao Austrália Nova Zelândia República Tcheca Islândia Dinamarca França Suécia Áustria Irlanda Alemanha República Eslovaca Noruega Luxemburgo Hungria Polônia Espanha Estados Unidos Látvia Rússia Itália Portugal Grécia Sérvia Turquia Uruguai Tailândia México Indonésia Tunísia BRASIL Mathematics Profficiency Grade in Maths in PISA/OECD (2003) 600 500 400 356 300 200 100 0 Source: Pisa/OECD (countries that are in both 2003 and 2012 samples.
BRASIL Tunísia México Polônia Turquia Portugal Itália Indonésia Rússia Sérvia Coréia Hong Kong Macao Alemanha Tailândia Grécia Látvia Suíça Japão Austrália Espanha Liechtenstein Irlanda Estados Unidos Luxemburgo Noruega Uruguai Hungria Canadá Dinamarca Bélgica Holanda França República Eslovaca República Tcheca Austrália Islândia Nova Zelândia Finlândia Suécia Mathematics Profficiency Points Improvement in Maths in PISA/OECD (2003-2012) 40 35 30 20 10 0-10 - 20-30 - 40 Source: Pisa/OECD.
HDI 2000 Human Development Index by Municipality 2000 - IPEA/FJP/PNUD In 2000, 41% of the municipalities presented very low HDI 0,800 a 1 0,700 a 0,799 0,600 a 0,699 0,500 a 0,599 0,000 a 0,499 Source: Ipea/PNUD/FJP from Demographic Census/IBGE 2010 microdata.
HDI 2010 Human Development Index by Municipality 2010 - IPEA/FJP/PNUD In 2010, 0.6% of the municipalities presented very low HDI 0,800 a 1 0,700 a 0,799 0,600 a 0,699 0,500 a 0,599 0,000 a 0,499 Source: Ipea/PNUD/FJP from Demographic Census/IBGE 2010 microdata.
PARTICIPATION OF RESIDENTIAL CAPITAL IN FAMILIES PHYSICAL ASSETS IS AROUND 50% IN BRAZIL AND ELSEWHERE Own House Effect - 2003 to 2012 100% 90% 80% 70% 80.7% 81.7% 77.10% 92.70% Household & Individual Characteristics 75.66% 74.71% 60% 50% 54.34% 40% 30% 37.41% 20% 10% 0% Rural Northeast Time to Work >2 hours Room Wall made of Straw No indoor plumbing No bathroom or toilet Total Brazil Source: IPEA from PNAD/IBGE microdata. Obs: The Own House Effect refers to the increase in imputed rent
wn House Effect - 2003 to 2012 Household & Individual Characteristics Also conditions within homes (durables) improved + than twice coverage of public services outside homes 100% 90% 90.079% 80% 70% 60% 50% 77.981% 51.718% 61.610% 57.160% 70.194% 40% 30% 37.41% 20% 10% 0% 5% Poorest (PCHI) 7 to 14 Years of Age Source: IPEA from PNAD/IBGE microdata. Black Informal Employee No instruction Individual Income up to ¼ Minimum Wage Total Brazil Obs: The Own House Effect refers to the increase in imputed rent
Inequality Fall in Residential Capital 0,06 Differences between concentration curves in time: 2003 to 2012 and 2009 to 2012 0,05 0,04 0,03 0,02 0,01 0-0,01-0,02 0 10 20 30 40 50 60 70 80 90 100 Property Income 2003/12 Household Income 2003/12 Property Income 2009/12 Household Income 2009/12 Source: microdata from PNAD/IBGE
Ratio Residential Capital RENT YIELD versus PROPERTY VALUE Besides equality and sustainability aspects, Popular Housing is also more Efficient 8% 7% Rent Value/Property Value Ratio: PNAD/2003, SIPS/2013 6% 5% 4% 3% 2% 1% 0% 0 10 20 30 40 50 60 70 80 90 100 Property Value (in R$ million) Values for July/2014
Personal Income Tax (PIT) Records and PNAD In Atkinson chartbook: mean correlation between Gini and the Top 1% share = 0.9 2007 and 2012 Number Reporters Gross Income* Net Income* Tax Due A. Total Population PNAD B. Household Per Capita Income PNAD C. Social Security / Occupied 2012 25,617,525 2,106.72 1,990.86 115.86 195,376,249 943.61 60.39% 2007 25,224,768 1,406.65 1,326.26 80.39 185,502,098 766.55 50.96% Var 2012/2007 1.56% 49.77% 50.11% 44.12% 5.32% 23.10% 18.5% But how high income growth in PIT will impact top incomes shares wrt National Accounts? Source: RFB - IRPF *In R$ billions of 31/12/2013 Proxy PNAD A*B*C Var 2012/2007 53.63% Total Income PNAD A*B Var 2012/2007 29.65% 39
Functional Income Distribution and Income Tax Records Using Main Declared Occupation 2007 and 2012 2012 Gross Total Income Net Total Income Number Forms Filled Income Tax Taxable Income Exclusive Taxable Income Exempt Income Capitalists 33.80% 34.96% 32.56% 14.65% 20.53% 39.22% 59.51% Rentiers 14.49% 14.57% 13.94% 13.21% 12.74% 17.78% 17.06% Workers 51.70% 50.47% 53.50% 72.14% 66.73% 43.01% 23.44% 2007 Capitalists 32.86% 33.90% 39.22% 15.75% 22.94% 43.81% 61.65% Rentiers 17.37% 17.23% 16.09% 19.65% 17.22% 19.11% 17.24% Workers 49.77% 48.86% 44.69% 64.60% 59.84% 37.08% 21.11% National accounts report an increase in labor share from 54% to 56% from 2007 to 2011 Source: SRF - IRPF 40
0,287701 0,372186 0.287 0.37 Income Tax Inequality Explained by Differences in Declared Occupations - Total Net Income - 2007 and 2012 0,4 0,35 0,3 0,25 0,2 0,15 0,1 0,05 0 Gini 2012* 2007* Var 2012/2007 Gini -22.70% Source: SRF - IRPF 41
Income Tax Inequality explained by Differences between States 2007 and 2012 - Total Net Income by Declared Population PIT Atk_2 Atk_1 Atk_05 GE_2 GE_1 GE_0 Gini 2012* 0.024592 0.012185 0.006057 0.011925 0.012035 0.012259 0.086052 2007* 0.032563 0.016713 0.008449 0.017475 0.017063 0.016854 0.101324 Dif. 2012/2007 Var 2012/2007-0.00797-0.00453-0.00239-0.00555-0.00503-0.0046-0.01527-24.48% -27.09% -28.31% -31.76% -29.47% -27.26% -15.07% Atk_ = Atkinson Inequality Index (respective coefficient of inequality aversion) GE_ = Generalized Entropy Index (respective parameter: 1= Theil L; 0 = Theil T) Source: SRF - IRPF 42
Future Happiness Life Satisfaction in 5 years Sensibility Felicidade Futura ( 2015) 2.8-4 4-5.19 5.19-6.39 6.39-7.58 7.58-8.78 No Data Brazil has the highest expected future life satisfaction: 8.8 on a 0 to 10 scale 2014 2013 2012 2011 2010 2009 2008 2007 2006 Total Mean Brazil 8.8 1 8.8 1 8.72 1 8.81 1 8.64 1 8.66 1 8.68 1 8.44 1 8.78 1 8.69 Brazil was for nine consecutive times the first in the World ranking of Future Happiness 5 years forward: The Country of the Future? Source: Gallup World Poll microdata
Inequality of Future Happiness Gini of Expected Life Satisfaction in 5 years In spite of its high income inequality, Brazil has the second lowest inequality of expected future life satisfaction (just after Belgium). Source: Gallup World Poll 2006 microdata
Geography of Life Satisfaction in 5 Years 2018 as seen from 2013 Individual 8.46 0 4 4 5.19 5.19 6.39 6.39 7.58 7.58 or more Source : IPEA 2013 Nation 6.8 0 4 4 5.19 5.19 6.39 6.39 7.58 7.58 or more
Demonstrations Profile of Protesters Variables / Participation Participated Didn t participate but wanted to Dind t participate, didn t want to, but approves Disapproves Average Age 31 37 46 50 Men 49% 37% 34% 32% Until 4th grade completed 4% 18% 31% 45% Incomplete or Complete Tertiary Education 26% 16% 8% 5% Receives Bolsa Família 19% 19% 24% 27% Household Head Income R$ Total Household Income R$ Source: SIPS/IPEA 2013 microdata R$ 1,464 R$ 1,382 R$ 1,104 R$ 871 R$ 2,836 R$ 2,544 R$ 1,802 R$ 1,722
Participation on 2013 Demonstrations Order of Importance of Explanatory Variables: Stepwise Multinomial Ordered Logit Model Variables Coefficient p-value Odds Ratio 1 Internet as Main Source Information 0.9893 <.0001 2.69 2 Northeast -0.736 <.0001 0.48 3 Head or Spouse -0.4172 0.0015 0.66 4 Work 0.2441 0.009 1.28 5 Incomes of the poorest improved + 0.3431 0.0001 1.41 6 Delay in Public Services Bill 0.2371 0.009 1.27 7 15-29 years 0.7224 <.0001 2.06 8 30-59 years 0.3755 0.0019 1.46 9 Is against Bolsa Familia 0.2638 0.0124 1.30 10 Has Private Health Insurance 0.192 0.0404 1.21 11 Confederations Cup City Host 0.443 0.0027 1.56 12 Central-West -0.4422 0.0555 0.64 13 Uses bus + than 3 times a week 0.2249 0.0464 1.25
Impacts of Bolsa Família on Final Goals: Changes in Life Satisfaction Sensibility Bolsa Família beneficiaries had initially the lowest past happiness 10 9 8 7 6 5 4 3 2 1 0 Present happiness is closer between beneficiaries and non-beneficiaries Past X Present Happiness 7.04 6.99 6.86 5.96 6.25 6.19 5.41 5.28 Total Social Security Unemployment Insurance Bolsa Família In the world ranking, Bolsa Família beneficiaries were before the program between Pakistan and Paraguay. Source: PPPP/IPEA October 2012
Cash Transfers and Change in Life Satisfaction 60% Bolsa Família beneficiaries showed the biggest jump of happiness compared with five years before leading to more equality in present life satisfaction 50% 40% 30% Increase in Present Happiness compared to Past Happiness 29.92% 20% 10% 18.12% 11.84% 14.42% 0% Total Social Security Unemployment Insurance Bolsa Família Comparing similar individuals with the same income today (in adittion to gender, age, marital status), receiving the Bolsa Família is associated with gains in present life satisfaction of 0.41 points compared to past life satisfaction*. Source: PPPP/IPEA October 2012 *Vis a vis non-beneficiaries, does not imply causality
Cumulative Income Bolsa Família Impact on Inequality 1.00 0.80 0.60 Bolsa Família BPC Poverty Equality Bolsa Familia covers 25% of Brazilian Population at a cost of 0,5% of GDP The concentration curve of the Bolsa Família differs from other sources of income = Each R$ generates more Equality Total per capita Income 0.40 Social Security Labor Other incomes 0.20 0.00 0.00 Cumulative Population 1.00 Source: SAE from microdata of PNAD/IBGE Labor Social Security Other Incomes BPC Bolsa Família Total per capita Income
Prosperity Social Accounting Matrix and (MCS) the Circular Flow of Income obtained with the expansion of a cash transfer Leaks Transfer Capital Account Indirect Effects Direct Effect Family income Direct Taxes Government Production Income from Factors Indirect Taxes Imports of goods and services Rest of the World
Prosperity Multiplier Effects of social transfers on: GROSS DOMESTIC PRODUCT Bolsa Família 1.78 BPC (Social Assistance) Unemployment Insurance Wage Subsidy Public Servants Pensions Private Employees Public Pension Severance Fund FGTS 0.39 0.53 0.52 1.06 1.06 1.19 0 2.70 Multipliers Bolsa Família Program (BFP) Continuous Cash Benefit (BPC) Unemployment Insurance (SegDesem) Wage Subsidy for Low Income Formal Employees Private sector pensions (RGPS) Public servants pensions (RPPS) Severance Fund Formal Employment (FGTS) Source: Neri, Vaz e Ferreira (2013) from the Social Account Matrix of 2009 (construcyed from POF and National Accounts)
Per capita family Income (U$) Bolsa Familia & Social Federalism 3.0 Benefits variable across families: Poorer get higher benefits Local Poverty Line US$ 2 PPP day Poverty Gap Extreme Poverty Line BF US$ 1,25 PPP day 0 5 Population Permanent Income Estimate: using Administrative Records (CadÚnico) info: Education all HH members, Housing & Public Services coverage, other benefits etc... Identifies who is chronically poor, and not who says is poor 10 15
Without Bolsa Familia Extreme Poverty in 2012 would rise 36% Life Cycle of Poverty - Simulation of the potential impact on extreme poverty rate by age of the new design benefits from Bolsa Família Program (%) 12 10 8 6 4 2 0 0 2 4 6 8 10 12 14 16 18 20 22 24 26 28 30 32 34 36 38 40 42 44 46 48 50 52 54 56 58 60 62 64 66 68 70 72 74 76 78 80 Without Bolsa Família With Bolsa Família from 2011 With Bolsa Família from 2013 Source: V National Report on the Millennium Development Goals.
Bolsa Família Innovations Payment Systems Completes Income towards the Poverty Line Use of International References (MDGs) Local Complements to Bolsa Família (Use of Permanent Income) Mothers Key Role (Search of Students Without Mother ) Conditionalities & Supply Services Parents Engagement (School Meetings on Saturdays) Early Childhood Education (Poor Kids are first in line; Cognitive & Non Cognitive skills) Incentives to Perform (Alignment Teachers, Parents & Students + Youth Savings)
Bolsa Família Channels to Overcome Poverty (Means Approach) Microcredit & Vocational Education PRODUCTIVE INCLUSION TRANSPORTATION SEWAGE CONDITIONALITIES DEMAND FOR EDUCATION AND HEALTH (EARLY CHILDHOOD) INCOME GENERATION Productivity HEALTH SCHOOLS EXTERNAL INFRASTRUCTURE MONETARY TRANSFERS DIRECT EFFECT FAMILY BUDGET OVERCOMING POVERTY DIRECT EFFECT WELL-BEING SUPPLY OF PUBLIC SERVICES CASH IN THE HAND OF MOTHERS LEVERAGE OPPORTUNITIES AND SMOOTH SHOCKS Decent Markets INTERNAL INFRASTRUCTURE (HOUSEHOLD) CONSUMER PROTECTION, FINANCIAL EDUCATION CREDIT, INSURANCE AND SAVINGS HOUSING CISTERNS
Returning to Questions about the Quality of Development (Ends Approach) Inclusive? Falling Inequality; How much has grown? household perspective better than GDP; Perceived by the people? Subjective Measures of Well-Being rising; Sustainable? Rising Stocks of Education, Labor, HDI, Housing; Poor Brazilians in household surveys have been improving more than the mean Brazil of National Accounts Brazil has been since the dawn of the new millenium the Country of the Past (not the contry of the future) Structural Change in the Basis of Assets Distribution = Deep Transformation
Map of Public Use Databases Household Surveys Microdata Administrative Records PNAD (100,000 housedholds per year) Annual Cross-section (1976-2012); IBGE National Accounts IBGE (Hybrid) Incomes, Residential Capital PIT Personal Income Tax POF (48,000 families per year) 1974; 2002; 2008 25 million individuals; 2007-2012 Details: Incomes, Spending and Taxes Unified Register for Social Programs CadÚnico (60 million individuals) MDS Mapping Subjective Surveys National CENSUS (18 million individuals) 1960-2010 IBGE, Long Run Income and Special Detailed Maps PPPP (3800 Interviews. 215 cities), Ipea Population Perceptions on Public Policies, Individuals 15 years or older Monitoring Subjective Surveys International PME (36 mil dwellings month) 1980-2014, IBGE Monthly Labor with a two month lag, 6 Metrocities, Gallup World Poll (more than 150 countries & 200.000 Interviews) 2006 to 2014 Subjective and Objective Data, Individuals 15 years or older
Brazil Social: References & Links (Marcelo Neri) Shared Prosperity: http://www.compaso.com.br/docs/pp_shared_prosperity_final.pdf Middle Class: http://www.compaso.com.br/docs/ncm_neri_sae_classemedia_ingl esfinal.pdf; http://www.cps.fgv.br/cps/livroncm/ & http://www.sae.gov.br/site/?p=22297 Social Tensions: http://www.compaso.com.br/docs/social_tension_final.pdf Pro Poor Growth: http://www.cps.fgv.br/cps/pesquisas/politicas_sociais_alunos/2011/p df/5pp_kakwaninerisonsdarticle.pdf Income Policies: http://www.fgv.br/cps/docs/acad/bf_livro_scanner.pdf Deprivation: http://www.compaso.com.br/docs/pp_inequality_relative_deprivatio n_and_social_class_final.pdf Social Transformations (portuguese recent study) www.compaso.com.br/docs/neri_transformacoessociaisatejulho201 4.pdf Thanks! Bolsa Família Book Summary http://www.ipea.gov.br/portal/images/stories/pdfs/140321_pbf_sum ex_ingles.pdf http://www.sae.gov.br/site/?p=22181 World Without Poverty https://www.wwp.org.br/en Human Development Map = Data Brazilian Cities http://atlasbrasil.ipea.gov.br/2013/en/ Report on MDGs http://www.sae.gov.br/site/?p=23274 Social Targets: http://www.cps.fgv.br/cps/pesquisas/politicas_sociais_alunos/2010/2 0100512/PDF/BES_MetasSociais_NeriXerez_Teoria.pdf BRICS: http://www.ipea.gov.br/forumbrics/en/ Brazilian Microdata & Data http://www.econ.puc-rio.br/datazoom/ www.ibge.gov.br http://www.ipeadata.gov.br/