The impact of cash transfer programs on Brazilian’s well-being

Abstract

Purpose The purpose of this paper is twofold: first, to investigate if there is any evidence of differentials in the well-being achievements of two groups which will be called the “artificially” and the “truly” not poor; and second, to test the hypothesis that income from work is a better entitlement than income received from social programs. Design/methodology/approach The author used data from the 2008 Brazilian Household Budget Survey and selected two groups. Both groups are composed of people living between the absolute and the relative poverty line. The group that is living above the absolute poverty line only due to cash transfer programs will be considered the “artificially” not poor. And people who are out of absolute poverty but not receiving any help from social program are considered the “truly” (and not absolutely) poor. The hypothesis was tested using structural equation modeling. Findings The results support the hypothesis that people who are not receiving income from cash transfer programs achieve a higher level of well-being in the dimensions of housing and food. Food and housing capabilities affect each other and such result reinforces the multidimensionality of the Brazilian poverty. Research limitations/implications The main limitations refers to the restrict number of dimensions and to the necessity to adapt the indicators available to answer the paper objectives. Practical implications The paper results can help the policy makers to better understand the cash transfer programs attainment and boundaries. Social implications The paper results highlight that the cash transfer programs, even being useful to improve people well-being, are not sufficient to promote human capabilities and are not truly undertaking the multidimensional deprivations of the poor. Originality/value The paper compares two groups of people living with identical amount of income acquired from different origins.