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Population Aging and Intergenerational Transfers in Brasil
Cassio M.TurraDemography Department
Cedeplar, UFMG
Value of National Transfer Accounts
• Fundamental question: how do different age groups, including children and the elderly, acquire and use economic resources?
• How are access and use to resources influenced by changes in population age structure:– demographic dividends and economic growth?– generational equity?– financial markets and asset prices?– sustainability of public and private support systems?
• What policies should be considered to best prepare for coming demographic change?
Gap in National Statistical Systems
• System of National Accounts and other aggregate economic data provide little information about how different generations or age groups produce, consume, share, and accumulate economic resources.
• National Transfer Accounts fills this gap.
Global Age Transition
• Need for NTA is great because of rapid changes in population age structure.
• Low income countries: Share of children in decline and share in working ages is rising
• High income countries: Share in working ages‐ is in decline and share of elderly is rising.
The Generational Economy
Per capita public and private transfers, and asset-based resource flows by age: Brazil, 1996
0123456789101112131415161718192021222324252627282930313233343536373839404142434445464748495051525354555657585960616263646566676869707172737475767778798081828384858687888990+
-8,000
-6,000
-4,000
-2,000
0
2,000
4,000
6,000
8,000
Public transfers Private transfers Asset-based reallocations
Age
Bra
zilia
n re
ais
7Ronald Lee and Andrew Mason, Dec 9, 2010
Jornal Valor EconômicoJulho de 2000
8
Most importante findings• Public transfers biased toward the elderly• Public transfers are the main source of consumption at older
ages, regardless of SES• Among children, public transfers concentrated among lower
SES groups. Private transfers to higher SES groups.• Rapid reduction in poverty among the elderly, but not among
children. Period x Cohort effects!• Inequity: over the life cycle, younger generations paid for the
expansion of transfers to currently elderly
9
Most importante findings• Large fiscal pressures (ignored in the last 10 years. Now the
issue is back!)• First demographic dividend started in 1970 and will end by
2030. Expansion of LFPR may give another decade• Second demographic dividend (productivity and savings):
negative?
50 years of elderly empowerment in Brazil
with Wajnman and Marteleto
Proportional changes in the composition of adults by income deciles, 1985-2008
1 2 3 4 5 6 7 8 9 100.40
0.60
0.80
1.00
1.20
1.40
1.60 young adultsmiddle-age adultselderly
Deciles
Prop
ortio
nal C
hang
e
Head, spouse, siblings Head’s generation
A classification for elderly (60+) households1. Living alone2. One generation household: elderly living only
with a collateral kin
3. Multi-generational household: elderly living in hhs with at least two generations
Generations in the Household Classification according to the perspective of the elderly
parents, grandparents, in-laws older generationHead, spouse, siblings Head’s generation
children, grandchildren, great-grand children younger generation
1970 1980 1991 2000 2010 -
10.00
20.00
30.00
40.00
50.00
60.00
70.00
80.00
90.00
100.00
Multi-generational household
One generation household
Living Alone14%
32%
Increasing prevalence of elderly living alone or in one generation households
8%
27%
Proportion of people 60+ living alone over time in selected countries
1960 1970 1980 1991 2000 20100
5
10
15
20
25
30
BrazilArgentinaMexicoChileUruguayColômbiaUnited States
Census Year (IPUMS DATA)
%
Generations in the Household
Classification according to the
perspective of the elderly
Group 1
parents, grandparents, in-laws older generationHead, spouse, siblings, in-laws Head’s generation
children, grandchildren, great-grand children
younger generation
Group 2
parents, grandparents, in-laws older generationhead, spouse, siblings, in-laws Head’s generation
children, grandchildren, great-grand children
younger generation
Group 3parents, grandparents, in-laws older generationhead, spouse, siblings, in-laws Head’s generation
children, grandchildren, great-grand children younger generation
A classification for multi-generational households
1970 1980 1991 2000 2010 -
10.00
20.00
30.00
40.00
50.00
60.00
70.00
80.00
90.00
100.00
Older generation
Head’s generation
Younger generation
62% 77%
Increasing prevalence of elderly living as the head generation in multi-generational hhs
1970 1980 1991 2000 2010 -
10.00
20.00
30.00
40.00
50.00
60.00
70.00
80.00
Head
Older
Increasing share of income earned by older and head’s generation in the multi-gerational hhs
Less than primary
Primary Secondary University -
10.00
20.00
30.00
40.00
50.00
60.00
70.00
Living Alone
Less than primary
Primary Secondary University -
10.00
20.00
30.00
40.00
50.00
60.00
70.00
One generation
Less than primary Primary Secondary University -
10.00
20.00
30.00
40.00
50.00
60.00
70.00 Multi-generational
1970 x 2010: Share of living alone higher in any educ group Less educated have lower prevalence of multigen hh
Convergence?
Less than primary
Primary Secondary University -
10.00 20.00 30.00 40.00 50.00 60.00 70.00 80.00 90.00
100.00
∆ 28% 18% 21%
4%
1970 x 2010: Increasing prevalence of elderly living as the head generation in multi-generation households
Particularly among the less educated
Less than primary
Primary Secondary University -
10.00
20.00
30.00
40.00
50.00
60.00
70.00
9x
1970 x 2010: in multi-gen hhs, when the elderly is in the older generation, share of income is increasing
Particularly among the less educated
Summary• Elderly are more likely to live alone or in one generation hhs,
particularly the less educated
• There has been increasing financial independence among elderly living in multi-generational hhs
• But we have not looked at the consumption side yet!
Intergenerational Public Transfers: 1996-2011
23
0.02
0.03
0.04
0.05
0.06
0.07
0.08
1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
Pensions , Public Servants
Health
Education
Pensions, Private Workers
Public Expenditures (share of GDP), Brazil, 1996-2008
Educationenrollmentby year& SES
Social Securitycoverageby year& SES
0.00
10.00
20.00
30.00
40.00
50.00
60.00
70.00
80.00
90.00
100.00
1960 1970 1980 1991 2000
Lowest SES
Highest SES
Education, 7-14
0.00
10.00
20.00
30.00
40.00
50.00
60.00
70.00
80.00
90.00
100.00
1960 1970 1980 1991 2000
Lowest SES
Highest SES
Social Security, 60+
25
-0.40
-0.20
0.00
0.20
0.40
0.60
0.80
1.00
1.20
0 4 8 12 16 20 24 28 32 36 40 44 48 52 56 60 64 68 72 76 80 84 88
1996
1996, excluding pensions for public servants
2004
2011
2011, excluding pensions for public servants
Net Public Transfers (YoLYs) by Age, Brazil, selected years
26
(0.5000)
-
0.5000
1.0000
1.5000
2.0000
(0.1500)
(0.1000)
(0.0500)
-
0.0500
0.1000
- 5 10 15 20 25 30 35 40 45 50 55 60 65 70 75 80 85 90
Prop
ortio
nal c
hang
e ag
e st
ruct
ure
Abso
lute
var
iatio
n N
et P
ublic
Tra
nsfe
rs (
YoLY
s)
Age
2011-1996, Net Public Transfers Population Age Structure
Absolute variation in net public transfers (YoLYs) by age, and proportional change in the age distribution, Brazil, 2008-1996
27
Actual Scenario1996 2004 2011
0-19 1.91 2.30 3.37 20-59 (6.96) (8.40) (10.21) 60-90 5.06 6.11 6.84
Ratio 60-90/0-19 2.65 2.66 2.03
Counterfactual scenario if population age structure as of 1996
0-19 1.91 2.39 3.53 20-59 (6.96) (7.16) (7.77) 60-90 5.06 4.65 4.07
Ratio 60-90/0-19 2.65 1.94 1.15
Aggregate net public transfers for large age groups(% of the GDP): actual and simulated scenarios,
28
CN
CR
GE HU
IN
JP
MX
SV
ASSK
SP
SW
TW
UK
US
URAU
R² = 0.6311
0
0.1
0.2
0.3
0.4
0.5
0.6
0.7
0.8
0.9
0 0.02 0.04 0.06 0.08 0.1 0.12 0.14 0.16 0.18 0.2
Net
pub
lic tr
ansf
ers t
o th
e el
derly
(60-
90)
Net public transfers to children (0-19)
Brazil, 1996-2011excluding public servants
Brazil, 1996-2011
Net public transfers to children (0-19) and elderly (60-90) for a recent year in 17 countries and selected years for Brazil.
29
Envelhecimento populacional no Brasil:
Bônus ou ônus?
Respostas Recorrentes (1996-2013!)
• Não há problema de financiamento dos benefícios para idosos. • Com o pré-sal cresceremos a taxas suficientemente altas para cobrirmos
os custos do envelhecimento.• O Brasil é um país que trata muito mal seus idosos. A questão não é
como manter, mas como aumentar os benefícios.• O problema está no pagamento dos juros. • Uma reforma profunda da previdência social resolveria o problema
imediatamente.• O tempo político é distinto do tempo demográfico.
50
55
60
65
70
75
80
85
90
95
100
0%
5%
10%
15%
20%
25%
30%
35%
POADR
OADR
Age RLE<15
OADR & POADR, Brazil, 1955-2045
Turra & Rios-Neto 2015
See also: Lutz, Scherbov, Sanderson
Discussão• Sistemas de suporte do idoso (previdência, saúde e cuidados de longa
duração) têm que considerar envelhecimento populacional e famílias menores. Mercado: pacto intergeracional na saúde suplementar
• Definição de idoso tem que ser flexível• Quanto antes forem as reformas, melhor: desigualdade intergeracional
poderá ser um problema• Migração Internacional
• Produtividade precisará crescer mais rápido (qualidade na educação, infra-estrutura, ambiente de negócios, economia aberta)
• Incentivos para poupança, educação financeira
O tamanho da nossa ignorância
• Diferenciais de mortalidade por renda, educação...
• Determinantes da saúde e mortalidade no ciclo de vida
• Probabilidades de transição no ciclo de vida
• Compressão da morbidade
• Transições de saúde e decisões de aposentadoria
• Transições de saúde e transferências intra e inter-domiciliares
• Mudanças nas políticas e decisões de aposentadoria
• Uso do tempo e cuidadores
• Formação de poupança no ciclo de vida
The Data are coming!!!
