| Hello, *|NOME|* Income is the most common indicator for assessing the economic well-being of households, but it is not always the most appropriate. There are several reasons to consider consumption, i.e., how much people spend on food, health, education, housing, transportation, and other goods and services, as a more accurate measure of a population's living conditions. Current income tends to fluctuate more than economic well-being, as people may save when incomes are temporarily high and turn to savings or credit when it is low. On the other hand, consumption seems to be more associated with an individual’s permanent or long-term income. Income also does not adequately reflect the flow of services that someone enjoys if they already own a house or a car, and they have no disbursements, but significant consumption. Moreover, income does not capture non-cash transfers made by the provision of public services such as health, education, and others. Another important aspect in favor of consumption to assess the well-being of families is the fact that it is more appropriate to reveal situations of deprivation. Measures of material difficulty or negative family outcomes are more severe for those with low consumption than for those with low income, and a breakdown of the food consumption basket (and the absorption of calories associated with it) allows us to identify among the poor those who should be the object of social programs of caloric and protein support. Precisely because of these reasons, IMDS dedicated itself to exploring a database dedicated to the analysis of household consumption. This important and rich source of data to analyze the consumption of Brazilian families is the Household Budget Survey (POF), conducted by the IBGE. This research investigates the household budgets, living conditions and nutrition aspects of Brazilian families, both in urban and rural areas. The last edition of POF was held between July 2017 and July 2018. Among the main information released by the POF are consumption expenditures, broken down by categories such as food, health, and education. These data make it possible to compare the consumption and well-being patterns of households in different regions, income classes, and demographic characteristics. IMDS launches a new dashboard of indicators that uses this information from the 2017/2018 Household Budget Survey ( POF). This dashboard is an interactive and dynamic tool that allows you to visualize and analyze the main consumption indicators of Brazilian families, as well as the factors that influence them, such as education, health, housing, and transportation. The dashboard also makes it possible to compare between different regions and states, in addition to offering filters by personal and household characteristics. For example, it is possible to quickly verify that non-monetary expenditure on education in Bahia is higher among black individuals than among whites (R$ 21.1 for blacks and R$ 14.3 for whites), while the opposite occurs in São Paulo (R$ 24.0 for whites and R$ 11.3 for blacks). And a lot of other information can be obtained intuitively and quickly. One of the indicators that the panel presents is the consumption pattern of Brazilian families, which varied greatly according to region and income. On average, each person spent R$ 1,548.01 per month and food was the largest expense, representing 15.2% of the total. However, the South, Southeast and Midwest regions had a much higher consumption pattern than the North and Northeast regions. For example, the average monthly per capita family consumption in the Midwest was R$ 1,944.40, while that in the North was R$ 897.34. In addition, the North region spent proportionally more on food at home (19.0%) than the Southeast region (13.6%).
The panel shows how Brazilian families distribute their expenses with health, education and food, the main components of the family budget. These expenditures vary significantly across regions, reflecting differences in income, habits, and needs of the population. The Southeast region had the highest monthly expenditure on health and education (R$ 139.31 and R$ 136.40, respectively), while the South region had the highest expenditure on food (R$ 267.31 per month). At the opposite extreme, the North region had the lowest monthly expenditure on health, food, and education (R$ 46.62, R$ 170.33, and R$ 36.65, respectively). The tool also reveals the high inequality in consumption in relation to the income distribution of Brazilian families. The richest 20% had an average monthly consumption expenditure of R$ 3,885.62 per person, more than 7 times higher than the consumption of the poorest 20%, who spent R$ 505.40 each month. This is one more facet of the high inequality in Brazil. In this case, however, much more serious than inequality is the fact that the poorest social strata have insufficient income that can jeopardize proper access to education, health and, at the limit, even food services, as well as restrictions on housing and transportation conditions. We hope that this new dashboard of indicators will be a useful tool for researchers, public managers, social organizations, and citizens interested in better understanding the socioeconomic reality of Brazilian families and in monitoring the evolution of these indicators over time. To access the interactive dashboard, where you can view and analyze the main indicators of the survey, just click on this link. And to learn more about the methodology and how the dashboard works, check out the usage guide at the link, which explains everything in detail. See you at the next “Letter from IMDS”! Paulo Tafner CEO |
