Nothing Special   »   [go: up one dir, main page]
IDEAS home Printed from https://ideas.repec.org/p/inq/inqwps/ecineq2020-558.html
   My bibliography  Save this paper

The Impact of COVID-19 Lockdowns and Expanded Social Assistance on Inequality, Poverty and Mobility in Argentina, Brazil, Colombia and Mexico

Author

Listed:
  • Nora Lustig

    (Tulane University)

  • Valentina Martinez Pabon

    (Tulane University)

  • Federico Sanz

    (Tulane University)

  • Stephen D. Younger

    (CEQ Institute)

Abstract
We use microsimulation to estimate the distributional consequences of covid-19-induced lockdown policies in Argentina, Brazil, Colombia and Mexico. Our estimates of the poverty consequences are worse than many others’ projections because we do not assume that the income losses are proportionally equal across the income distribution. We also simulate the effects of most of the expanded social assistance governments have introduced in response to the crisis. This has a large offsetting effect in Brazil and Argentina, much less in Colombia. In Mexico, there has been no such expansion. Contrary to prior expectations, we find that the worst effects are not on the poorest, but those (roughly) in the middle of the ex ante income distribution. In Brazil we find that poverty among the afrodescendants and indigenous populations increases by more than for whites, but the offsetting effects of expanded social assistance also are larger for the former. In Mexico, the crisis induces significantly less poverty among the indigenous population than it does for the nonindigenous one. In all countries the increase in poverty induced by the lockdown is similar for male- and female-headed households but the offsetting effect of expanded social assistance is greater for female-headed households.

Suggested Citation

  • Nora Lustig & Valentina Martinez Pabon & Federico Sanz & Stephen D. Younger, 2020. "The Impact of COVID-19 Lockdowns and Expanded Social Assistance on Inequality, Poverty and Mobility in Argentina, Brazil, Colombia and Mexico," Working Papers 558, ECINEQ, Society for the Study of Economic Inequality.
    • Handle: RePEc:inq:inqwps:ecineq2020-558
    as

    Download full text from publisher

    File URL: http://www.ecineq.org/milano/WP/ECINEQ2020-558.pdf
    File Function: First version, 2020
    Download Restriction: no
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Giovanni Valensisi, 2020. "COVID-19 and Global Poverty: Are LDCs Being Left Behind?," The European Journal of Development Research, Palgrave Macmillan;European Association of Development Research and Training Institutes (EADI), vol. 32(5), pages 1535-1557, December.
    2. Decerf, Benoit & Ferreira, Francisco H.G. & Mahler, Daniel G. & Sterck, Olivier, 2021. "Lives and livelihoods: Estimates of the global mortality and poverty effects of the Covid-19 pandemic," World Development, Elsevier, vol. 146(C).
    3. Christoph Lakner & Daniel Gerszon Mahler & Mario Negre & Espen Beer Prydz, 2022. "How much does reducing inequality matter for global poverty?," The Journal of Economic Inequality, Springer;Society for the Study of Economic Inequality, vol. 20(3), pages 559-585, September.
    4. Dean Jolliffe & Espen Beer Prydz, 2016. "Estimating international poverty lines from comparable national thresholds," The Journal of Economic Inequality, Springer;Society for the Study of Economic Inequality, vol. 14(2), pages 185-198, June.
    5. repec:idb:brikps:publication-detail,7101.html?id=66306 is not listed on IDEAS
    6. Nicolas Bottan & Bridget Hoffmann & Diego Vera-Cossio, 2020. "The unequal impact of the coronavirus pandemic: Evidence from seventeen developing countries," PLOS ONE, Public Library of Science, vol. 15(10), pages 1-10, October.
    7. Nancy Birdsall, 2010. "The (Indispensable) Middle Class in Developing Countries; or, The Rich and the Rest, Not the Poor and the Rest," Working Papers 207, Center for Global Development.
    8. repec:idb:brikps:78783 is not listed on IDEAS
    9. Andy Sumner & Eduardo Ortiz-Juarez & Christopher Hoy, 2020. "Precarity and the pandemic: COVID-19 and poverty incidence, intensity, and severity in developing countries," WIDER Working Paper Series wp-2020-77, World Institute for Development Economic Research (UNU-WIDER).
    10. François Bourguignon, 2011. "Status Quo In The Welfare Analysis Of Tax Reforms," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 57(4), pages 603-621, December.
    11. Stampini, Marco & Tornarolli, Leopoldo, 2012. "The Growth of Conditional Cash Transfers in Latin America and the Caribbean: Did They Go Too Far?," IZA Policy Papers 49, Institute of Labor Economics (IZA).
    12. -, 2020. "Addressing the growing impact of COVID-19 with a view to reactivation with equality: New projections," Libros y Documentos Institucionales, Naciones Unidas Comisión Económica para América Latina y el Caribe (CEPAL), number 45784 edited by Cepal.
    13. Homi Kharas, 2010. "The Emerging Middle Class in Developing Countries," OECD Development Centre Working Papers 285, OECD Publishing.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Martijn Burger & Martijn Hendriks & Elena Ianchovichina, 2022. "Happy but Unequal: Differences in Subjective Well-Being across Individuals and Space in Colombia," Applied Research in Quality of Life, Springer;International Society for Quality-of-Life Studies, vol. 17(3), pages 1343-1387, June.
    2. Decerf, Benoit & Ferreira, Francisco H.G. & Mahler, Daniel G. & Sterck, Olivier, 2021. "Lives and livelihoods: Estimates of the global mortality and poverty effects of the Covid-19 pandemic," World Development, Elsevier, vol. 146(C).
    3. Guido Neidhöfer & Nora Lustig & Mariano Tommasi, 2021. "Intergenerational transmission of lockdown consequences: prognosis of the longer-run persistence of COVID-19 in Latin America," The Journal of Economic Inequality, Springer;Society for the Study of Economic Inequality, vol. 19(3), pages 571-598, September.
    4. Isaure Delaporte & Julia Escobar & Werner Peña, 2021. "The distributional consequences of social distancing on poverty and labour income inequality in Latin America and the Caribbean," Journal of Population Economics, Springer;European Society for Population Economics, vol. 34(4), pages 1385-1443, October.
    5. Gonzalo Gomez Bengoechea, 2021. "The impact of the COVID-19 crisis on income distribution under different protection schemes: the case of Spain," Public Sector Economics, Institute of Public Finance, vol. 45(4), pages 517-541.
    6. Ben Yahmed, Sarra & Cappellari, Lorenzo & Checchi, Daniele & Corak, Miles & Jenkins, Stephen P. & Neidhöfer, Guido & Tertilt, Michele & Tommasi, Mariano, 2020. "COVID-19 and inequality," ZEW policy briefs 5/2020, ZEW - Leibniz Centre for European Economic Research.
    7. Mendoza-Lozano, Frederick Andrés & Quintero-Peña, Jose Wilmar & García-Rodríguez, Jose Felix, 2021. "The digital divide between high school students in Colombia," Telecommunications Policy, Elsevier, vol. 45(10).
    8. Sébastien CARRERE & Matthieu CLEMENT & François COMBARNOUS & Gabriel KESSLER & Eric ROUGIER & Ariel WILKIS, 2022. "The middle class in Argentina: dynamics, characteristics and implications for public policies," Working Paper 83de5468-cd86-4702-a4a8-6, Agence française de développement.
    9. Angelo Cozzubo & Javier Herrera & Mireille Razafindrakoto & François Roubaud, 2021. "El impacto de políticas diferenciadas de cuarentena sobre la mortalidad por COVID-19: el caso de Brasil y Perú," Documentos de Trabajo / Working Papers 2021-501, Departamento de Economía - Pontificia Universidad Católica del Perú.
    10. Hoehn-Velasco, Lauren & Silverio-Murillo, Adan & de la Miyar, Jose Roberto Balmori, 2021. "The great crime recovery: Crimes against women during, and after, the COVID-19 lockdown in Mexico," Economics & Human Biology, Elsevier, vol. 41(C).
    11. F. Yudhi Priyo Amboro, 2021. "The Corporate Rescue for Companies during the COVID-19 Pandemic in Indonesia: Prospects for the Concept of Deeds of Arrangement and Administration Order," Technium Social Sciences Journal, Technium Science, vol. 23(1), pages 385-400, September.
    12. Nakamura, Nobuyuki & Suzuki, Aya, 2021. "COVID-19 and the intentions to migrate from developing countries: Evidence from online search activities in Southeast Asia," Journal of Asian Economics, Elsevier, vol. 76(C).
    13. Francisco Corona & Graciela Gonz'alez-Far'ias & Jes'us L'opez-P'erez, 2021. "A nowcasting approach to generate timely estimates of Mexican economic activity: An application to the period of COVID-19," Papers 2101.10383, arXiv.org.
    14. Oliver Fiala & Enrique Delamónica & Gerardo Escaroz & Ismael Cid Martinez & José Espinoza-Delgado & Aristide Kielem, 2021. "Children in Monetary Poor Households: Baseline and COVID-19 Impact for 2020 and 2021," Economics of Disasters and Climate Change, Springer, vol. 5(2), pages 161-176, July.
    15. Nora Lustig & Valentina Martinez Pabon & Guido Neidhöfer & Mariano Tommasi, 2020. "Short and Long-Run Distributional Impacts of COVID-19 in Latin America," Working Papers 2013, Tulane University, Department of Economics.
    16. H. Xavier Jara & Lourdes Montesdeoca & Iva Tasseva, 2022. "The Role of Automatic Stabilizers and Emergency Tax–Benefit Policies During the COVID-19 Pandemic: Evidence from Ecuador," The European Journal of Development Research, Palgrave Macmillan;European Association of Development Research and Training Institutes (EADI), vol. 34(6), pages 2787-2809, December.
    17. Ambrosius, Christian & Campos Vázquez, Raymundo M. & Esquivel, Gerardo, 2021. "What drives remittances during a global shock? Evidence from the COVID-19 pandemic in Mexico," Discussion Papers 2021/13, Free University Berlin, School of Business & Economics.
    18. Hoehn-Velasco, Lauren & Silverio-Murillo, Adan & Balmori de la Miyar, Jose Roberto, 2021. "The long downturn: The impact of the great lockdown on formal employment," Journal of Economics and Business, Elsevier, vol. 115(C).
    19. Magalasi, Chimwemwe, 2021. "The short-term distributional impact of COVID-19 in Malawi," EUROMOD Working Papers EM7/21, EUROMOD at the Institute for Social and Economic Research.
    20. Amarante, Verónica, 2022. "Fortalecimiento de los sistemas de protección social de la región: aprendizajes a partir de la pandemia de COVID-19," Documentos de Proyectos 47830, Naciones Unidas Comisión Económica para América Latina y el Caribe (CEPAL).
    21. Palacios-Lopez,Amparo & Newhouse,David Locke & Pape,Utz Johann & Khamis,Melanie & Weber,Michael & Prinz,Daniel, 2021. "The Early Labor Market Impacts of COVID-19 in Developing Countries : Evidence from High-Frequency Phone Surveys," Policy Research Working Paper Series 9510, The World Bank.
    22. Luis Huesca & Linda Llamas & H. Xavier Jara & César O. Vargas Téllez & David Rodríguez, 2021. "The impact of the COVID-19 pandemic on poverty and inequality in Mexico," Remef - Revista Mexicana de Economía y Finanzas Nueva Época REMEF (The Mexican Journal of Economics and Finance), Instituto Mexicano de Ejecutivos de Finanzas, IMEF, vol. 16(3), pages 1-19, Julio - S.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Nora Lustig & Valentina Martinez Pabon & Federico Sanz & Stephen D. Younger, 2021. "The Impact of COVID-19 and Expanded Social Assistance on Inequality and Poverty in Argentina, Brazil, Colombia and Mexico," Commitment to Equity (CEQ) Working Paper Series 92, Tulane University, Department of Economics.
    2. Nora Lustig & Valentina Martinez Pabon & Federico Sanz & Stephen D Younger, 2023. "The Impact of COVID-19 on Living Standards: Addressing the Challenges of Nowcasting Unprecedented Macroeconomic Shocks with Scant Data and Uncharted Economic Behavior," International Journal of Microsimulation, International Microsimulation Association, vol. 16(1), pages 1-27.
    3. Nora Lustig & Valentina Martinez Pabon & Guido Neidhöfer & Mariano Tommasi, 2020. "Short and Long-Run Distributional Impacts of COVID-19 in Latin America," Working Papers 2013, Tulane University, Department of Economics.
    4. Francisco H. G. Ferreira & Olivier Sterck & Daniel Mahler & Benoit Decerf, 2021. "Death and Destitution: The global distribution of welfare losses from the COVID-19 pandemic," Working Papers 581, ECINEQ, Society for the Study of Economic Inequality.
    5. Christopher Hoy & Andy Sumner, 2021. "The End of Global Poverty: Is the UN Sustainable Development Goal 1 (Still) Achievable?," Global Policy, London School of Economics and Political Science, vol. 12(4), pages 419-429, September.
    6. Nora Lustig & Valentina Martinez Pabon, 2020. "The Impact of COVID-19 Economic Shock on Inequality and Poverty in Mexico," Working Papers 2014, Tulane University, Department of Economics.
    7. Ferreira, Francisco H. G. & Sterck, Olivier & Mahler, Daniel G. & Decerf, Benoit, 2021. "Death and destitution: distribution of welfare losses from the Covid-19 pandemic," LSE Research Online Documents on Economics 110480, London School of Economics and Political Science, LSE Library.
    8. Angel Melguizo, 2015. "Pensions, informality, and the emerging middle class," IZA World of Labor, Institute of Labor Economics (IZA), pages 169-169, July.
    9. Berrou, Jean-Philippe & Clément, Matthieu & Combarnous, François & Darbon, Dominique & Fauré, Yves-André, 2020. "Anatomy of the Brazilian middle class: identification, behaviours and expectations," Revista CEPAL, Naciones Unidas Comisión Económica para América Latina y el Caribe (CEPAL), April.
    10. Oliver Fiala & Enrique Delamónica & Gerardo Escaroz & Ismael Cid Martinez & José Espinoza-Delgado & Aristide Kielem, 2021. "Children in Monetary Poor Households: Baseline and COVID-19 Impact for 2020 and 2021," Economics of Disasters and Climate Change, Springer, vol. 5(2), pages 161-176, July.
    11. Simplice A. Asongu & Nicholas M. Odhiambo, 2021. "Income Levels, Governance and Inclusive Human Development in Sub-Saharan Africa," Applied Research in Quality of Life, Springer;International Society for Quality-of-Life Studies, vol. 16(1), pages 71-103, February.
    12. Huynh, Phu. & Kapsos, Steven., 2013. "Economic class and labour market inclusion poor and middle class workers in developing Asia and the Pacific," ILO Working Papers 994822963402676, International Labour Organization.
    13. Decerf, Benoit & Ferreira, Francisco H.G. & Mahler, Daniel G. & Sterck, Olivier, 2021. "Lives and livelihoods: Estimates of the global mortality and poverty effects of the Covid-19 pandemic," World Development, Elsevier, vol. 146(C).
    14. Giulia Barletta & Finório Castigo & Eva‐Maria Egger & Michael Keller & Vincenzo Salvucci & Finn Tarp, 2022. "The impact of COVID‐19 on consumption poverty in Mozambique," Journal of International Development, John Wiley & Sons, Ltd., vol. 34(4), pages 771-802, May.
    15. Jehovaness Aikaeli & David Garcés‐Urzainqui & Kenneth Mdadila, 2021. "Understanding poverty dynamics and vulnerability in Tanzania: 2012–2018," Review of Development Economics, Wiley Blackwell, vol. 25(4), pages 1869-1894, November.
    16. Vyacheslav Bobkov & Peter Herrmann & Igor Kolmakov & Yelena Odintsova, 2018. "Two-Criterion Model of the Russian Society Stratification by Income and Housing Security," Economy of region, Centre for Economic Security, Institute of Economics of Ural Branch of Russian Academy of Sciences, vol. 1(4), pages 1061-1075.
    17. Handley, Antoinette, 2014. "Varieties of capitalists? The middle class, private sector and economic outcomes in Africa," WIDER Working Paper Series 101, World Institute for Development Economic Research (UNU-WIDER).
    18. Orlando Zambrano Roman, 2020. "An emerging but vulnerable middle class: a description of trends in Asia and the Pacific," Asia-Pacific Sustainable Development Journal, United Nations Economic and Social Commission for Asia and the Pacific (ESCAP), vol. 27(1), pages 1-20, June.
    19. repec:ilo:ilowps:482296 is not listed on IDEAS
    20. Reham Rizk & Ricardo Nogales, 2017. "Revisiting the Middle-Class Myth: Evidence From A Cross-Country Analysis of African Social Progress," Working Papers 1139, Economic Research Forum, revised 09 2003.
    21. Mariam Shahzadi & Muhammad Faraz Riaz & Sofia Anwar & Samia Nasreen, 2017. "How unequal is the size of middle class in the rural urban areas of Punjab province," International Journal of Social Economics, Emerald Group Publishing Limited, vol. 44(2), pages 253-266, February.

    More about this item

    Keywords

    Covid-19; inequality; poverty; mobility; microsimulations; Latin America;
    All these keywords.

    JEL classification:

    • C63 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Computational Techniques
    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
    • I32 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Measurement and Analysis of Poverty
    • I38 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Government Programs; Provision and Effects of Welfare Programs

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:inq:inqwps:ecineq2020-558. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Maria Ana Lugo (email available below). General contact details of provider: https://edirc.repec.org/data/ecineea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.