POVERTY AND INCOME DISTRIBUTION IN CHILE 1987-1998.: NEW EVIDENCE

Résumé 0

This paper presents an update on the poverty and income distribution situation in Chile during the 90s. The analysis shows unambiguously that there was less poverty between 1994 and 1998 than in all earlier years, whether poverty is measured by the headcount, the poverty deficit or by any of the most sensitive poverty indices. The evidence also confirms that income inequality in Chile remains high by international standards. Nevertheless, notwithstanding the earlier observation, the overall picture on inequality is one of a fairly stable distribution for the period as a whole, with changes in income shares being relatively small in proportion to the size of the shares themselves. In addition, this study develops and applies a methodology for the estimation of the imputed income transfers from government subsidies in health, education, and housing, for the years 1990, 1994, 1996 and 1998. The analysis has confirmed that adjustments for in-kind income transfers substantially reduce the Gini coefficient on income inequality. For 1998, this coefficient falls from 0.56 (unadjusted) to 0.50 (adjusted) and the ratio of the highest (richest) to the lowest (poorest) quintile falls from 20 to 11. These results suggest that social policies in Chile have had a significant impact in reducing income inequality, in spite of the fact that such policies are oriented towards poverty reduction rather than reduction in inequality per se. The study also presents a quantitative assessment of the "deficit" in health, education, and housing status between the years 1990 and 1998, by comparing the access to these services with various thresholds based on widely accepted standards in each area. Based on a number of indicators, the study documents the educational, health, and housing status during these two years, and presents comparative estimates of the current deficits in each of these three areas in 1990 and 1998. Overall, the study confirms the critical importance of achieving high growth and constant appraisal of the current social policies. There is no question that Chile's growth and social policies were successful in reducing the incidence and intensity of poverty