Estimated cost of non-contributory cash transfers

ECLAC (2010a, 2010b) has conducted simulation exercises of the cost to the State of fulfilling its social protection function, which includes noncontributory cash transfers for guaranteeing and redistributing income. The simulation exercises were conducted on the basis of microdata from household surveys and were parameterized using national accounts data in order to estimate costs in gross domestic product (GDP) terms. The model allocates an amount equivalent to one poverty (or extreme poverty) line to each person eligible under the selected criteria and computes the new household income. On this basis, indicators of poverty and inequality are re-estimated and the scope of household coverage for each measure is determined.

Related Subject(s): Economic and Social Development