Work

The Effects of Non-Contributory Pensions on Material and Subjective Well Being

Year: 2016

Type: report

Abstract: Public expenditures on non-contributory pensions are equivalent to at least 1 percent of GDP in several countries in Latin America and is expected to increase.We explore the effect of noncontributory pensions on the well-being of the beneficiary population by studying the Pension 65 program in Peru, which uses a poverty eligibility threshold.We find that the program reduced the average score of beneficiaries on the Geriatric Depression Scale by nine percent and reduced the proportion of older adults doing paid work by four percentage points.Moreover, households with a beneficiary increased their level of consumption by 40 percent.All these effects are consistent with the findings of Galiani, Gertler and Bando (2016) in their study on a non-contributory pension scheme in Mexico.Thus, we conclude that the effects of non-contributory pensions on well-being in rural Mexico can be largely generalized to Peru.

Source: National Bureau of Economic Research

DOI: 10.3386/w22995

Authors: Rosangela Bando, Sebastian Galiani, Paul Gertler

Institutions: National Bureau of Economic Research, Inter-American Development Bank, University of Maryland, College Park, University of California, Berkeley

Language: English

Topic: Financial Literacy, Pension, Retirement Analysis

Subfield: Accounting

Field: Business, Management and Accounting

Domain: Social Sciences

SDGs: Good health and well-being, No poverty, Decent work and economic growth, Reduced inequalities

Open Access status: green

Funder: Inter-American Development Bank

OpenAlex ID: W2568366410

Cites: 35

Cited by: 26

Related to: 10