NON-LABOR INCOME SHARES AND THEIR CONTRIBUTION TO INEQUALITY IN BRAZIL

ABSTRACT

This paper analyzed the inequality of non-labor income shares in relation to total per capita household income (RDPC) based on data from the National Household Sample Survey (PNAD). To this end, the participation of these shares in RDPC formation, the concentration ratio, and the composition and concentration effects were estimated using the dynamic and static decomposition technique of the Gini index. Results suggest that 83.71% of total non-labor income is composed of retirement and pension income. Between 2001 and 2015, the fall in inequality associated with non-labor income was 42.36%, with the concentration effect having the largest share (35.91%). Of the shares analyzed, retirements and pensions of up to one minimum wage and government income transfers had the largest contributions to reduce inequality-11.91% and 15.92%, respectively. From 2012 to 2020, the results of the PNAD Contínua shows that retirements and pensions are regressive and that the Gini index, which had been growing since 2016, fell in 2020 due to the increased share of emergency aid in total income.

KEYWORDS:
Brazil; non-labor income; inequality measures; Gini index decomposition