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Social Indicators Research
Published in: Social Indicators Research 2/2022

24-04-2022 | Original Research

Poverty Among The Elderly: An Application of a Collective Consumption Model in Brazil

Authors: Guilherme Fonseca Travassos, Alexandre Bragança Coelho, Mary Paula Arends-Kuenning

Published in: Social Indicators Research | Issue 2/2022

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Abstract

The growth of the elderly population and changes in household composition raise important questions regarding the level of well-being of the elderly in developing countries. Traditional analyses of poverty often ignore the question of intra-household distribution of resources. This paper is the first to apply a collective consumption model to analyze the level of well-being of the elderly in Brazil. Our results indicate that living in a couple is associated with considerable economies of scale and that wive’s shares are increasing as total expenditures increase. We find that, in Brazil, elderly women experience a considerable decrease in material well-being when living alone, compared to elderly men. Finally, we conclude that disregarding the intra-household distribution of resources results in both underestimates and overestimates poverty among the elderly in Brazil.
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Appendix
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Footnotes
1
Demographic transition is defined by the process when a population moving from a state of high fertility, high mortality, and the predominance of a young population, to a state of low fertility, low mortality, and the predominance of an old population (Cotlear, 2010).
 
2
See Weir et al. (2004), McGarry and Schoeni (2005), and Zaidi et al. (2006).
 
3
The unitary consumption model considers the household as the unit of decision making, not taking into account the allocation within the household (Haddad and Kanbur, 1990).
 
4
Quilombolas are people who have been granted official status by the federal government of Brazil to have access to reserves of land. Historically, they were descendants of escaped slaves who settled land in remote areas. Today, they are Afro-Brazilians who have been given title to land through a federal process.
 
5
For simplicity, we will use the word “spouse”, but individuals who make up the household do not necessarily need to be married. In addition, we will not consider households composed of other people in addition to the elderly due to the need to identify the individual demands in the collective consumption model.
 
6
According Cherchye et al. (2012), using the normalized prices implies that the unit in which monetary variables are expressed does not have an impact on the Pareto weight.
 
7
For more details about different classifications of purchased consumption bundles, see Browning and Chiappori (1998) and Cherchye et al. (2007).
 
8
The Gorman’s linear technology demand model of consumption (1976) can be specified as follows: Barten (1964) is the Gorman’s model (1976) with and as a diagonal matrix.
 
9
See Deaton (1997) for a detailed description of the Delta method.
 
10
According to POF 2017/18 data, there were 19,638,838 households headed by elderly people in Brazil, of which 16,808,555 lived in urban areas (85.6% of all households) and 7,512,558 in metropolitan areas (38.3% of all households and 44.7% of urban households) and 6,286,904 in the eleven metropolitan regions analyzed (32.0% of all households, 37.4% of urban households and 83.7% of metropolitan households). This information shows that the eleven metropolitan areas covered in the study comprise a significant proportion of the total households, of those located in urban areas and of those located in the metropolitan regions as a whole in Brazil.
 
11
According to POF 2017/18, among the households containing elderly people, approximately 19.3% are single-person households, of which 60.0% were elderly women and 40.0% were elderly men living alone. In addition, approximately 15.0% of the elderly lived only with their elderly spouse and 39.4% lived with children. The other 26,3% lived in another kind of household composition.
 
12
Velilla-Gómez (2017) found a mean value for men’s resource shares of 0.53 in childless couple’s households (close to 0.50), 0.41 in couples with one child, 0.38 in couples with two children and 0.36 in couples with three children. On the other hand, the author found women’s resource shares of 0.47 in childless couple’s households, 0.59 in couples with one child, 0.62 in couples with two children and 0.64 in couples with three children.
 
13
The modified OECD scale follows the economies of scale measure of 0.33, which is lower than the result we found in our collective consumption model (0.77).
 
14
Turra and Rocha (2010) (cited in World Bank (2011)) performed an age-period-cohort analysis and estimated poverty rates based on the World Bank's poverty line of US$ 2.00 per day in purchasing power parity in 2005 with and without public transfers including contributory and non-contributory retirement benefits, as well as conditional cash transfers from the Bolsa Familia program.
 
15
We have to be cautious here, because in our database we cannot observe whether the elderly individuals in single-person households are divorced, never married, or widow(er)s.
 
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Metadata
Title
Poverty Among The Elderly: An Application of a Collective Consumption Model in Brazil
Authors
Guilherme Fonseca Travassos
Alexandre Bragança Coelho
Mary Paula Arends-Kuenning
Publication date
24-04-2022
Publisher
Springer Netherlands
Published in
Social Indicators Research / Issue 2/2022
Print ISSN: 0303-8300
Electronic ISSN: 1573-0921
DOI
https://doi.org/10.1007/s11205-022-02932-7

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