The Effects of Noncontributory Pensions on Material and Subjective Well-Being

Rosangela Bando, Sebastian Galiani and Paul Gertler

Economic Development and Cultural Change, 2020, vol. 68, issue 4, 1233 - 1255

Abstract: Public expenditures on noncontributory pensions are equivalent to at least 1% of gross domestic product in several countries in Latin America and are expected to increase. We explore the effect of noncontributory pensions on well-being by studying the Pension 65 program in Peru, which uses a poverty eligibility threshold. Households with a beneficiary increased their level of consumption by 40%. The program improved subjective well-being by 0.17 standard deviations. Comparing our findings to those we published in 2016, we conclude the effects of noncontributory pensions on well-being in rural Mexico are comparable to those found in Peru.

Date: 2020
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Related works:
Working Paper: The Effects of Non-Contributory Pensions on Material and Subjective Well Being (2017)
Working Paper: The Effects of Non-Contributory Pensions on Material and Subjective Well Being (2016)
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