The Dynamics of Inequality and Poverty Among Children in Colombia During the COVID-19 Recession

Abstract

Abstract  This study examines the impact of the COVID-19 pandemic on the income, inequality, and poverty levels among Colombian children between 2019 and 2020, using data from the Luxembourg Income Study Database. The income distribution and changes among Colombian children are analyzed using the probability density function and growth incidence curve. The paper utilizes the Foster–Greer–Thorbecke methodology to measure child poverty in Colombia, decomposes the contributions of different subgroups to child poverty and its changes, and conducts a growth-distribution decomposition of changes in child poverty. The study also employs income-source decomposition to examine the contributions of different income sources to child inequality and its changes. The results show that Colombian children experienced a decline in income, an increase in inequality, and higher levels of poverty during the COVID-19 pandemic. Children from households with higher dependency ratios and those living in rural areas were more likely to experience poverty. The main driver of increased poverty among Colombian children was decreased income, and there was a significant worsening of inequality for ultra-poor children. Labor income emerged as the primary source of inequality and its changes, whereas capital income and private transfers played a role in reducing poverty. However, public social benefits slightly increased inequality levels. Overall, the recession caused by the COVID-19 pandemic is antipoor but pro-ultra-poor. To address similar recessions in the future, the government should expand public transfer payments especially programs targeting children to reduce income inequality and alleviate poverty among children, and bolster the provision of public services essential for children’s development.