Brazil’s Bolsa Familia: Its Impact on Inequality & Poverty in the Long-Run

Introduction Latin America is one of the most unequal areas in the world. Inequality in this area can be traced back to the Spanish colonial era. Due to the Spanish mercantilistic political economy, certain groups such as European elite, merchants, wealthy land classes preferred to offer rents but ignore others - slaves and slaves - (Mahoney 2010, 21). . However, in recent years Latin American countries, including Brazil, are at the forefront of fight against poverty and inequality.

Brazil has introduced the Bolsa Familia cash transfer system since 2003. The number of impacts varies from study to research, but the outcome in reducing poverty and inequality remains important. Cash transfers under conditions such as school education and vaccination for children greatly increased the number of enrollments and reduced the infant mortality rate. Brazil uses only 1% of GDP for cash movement. This will help improve education, health and poverty reduction. A large amount of money arrived in the hands of the poor for direct payment to the recipient's bank account.

Previous studies (eg Veras et al., 2007) have shown that Brazilian cash transfers through the Bolsa Familia program DBT greatly affect poverty and inequality reduction between 1995 and 2004 . According to the survey, 80% of the Borsa Familia households increased their revenues by the cash transfer benefit program during this period. Money in the hands of the poor will allow them to buy from the market and will probably expand their choice of goods and services. Others believe that funds flowing into rural areas will create their own markets and economic activities. In spite of the high cost of the initial integration of DBT's effective infrastructure, the experience of cash transfer programs in Brazil and Mexico shows that the cost of subsequent periods will decline significantly. The best part of DBT is to reduce corruption as there are few intermediaries involved in the process.

Existing developing countries are implementing effective social security programs. In Brazil, President Luis Inacio Lula da Silva of the time announced "Borsa Familia" in 2002 to cope with extreme poverty and economic inequality. The population in 10 years from the launch reached approximately 25%, and at the same time Brazil's extreme poverty rate fell from 9.7% to 4.3%. Mexico established its own conditional cash transfer program in 1997 to encourage mothers to let children go to school or hospital. This program, now known as Prospera, is believed to improve education, strengthen nutrition, and reduce poverty. Prospera elements are replicated in more than 50 countries