Population Aging - Is Latin America Ready pot

Population Aging Is Latin America Ready? Daniel Cotlear, Editor DIRECTIONS IN DEVELOPMENT Human Development Public Disclosure AuthorizedPublic Disclosure AuthorizedPublic Disclosure AuthorizedPublic Disclosure Authorized 58842 Population Aging Population Aging Is Latin America Ready? Edited by Daniel Cotlear © 2011 The International Bank for Reconstruction and Development / The World Bank 1818 H Street NW Washington DC 20433 Telephone: 202-473-1000 Internet: www.worldbank.org All rights reserved 1 2 3 4 13 12 11 10 This volume is a product of the staff of the International Bank for Reconstruction and Development/The World Bank. The findings, interpretations, and conclusions expressed in this volume do not necessarily reflect the views of the Executive Directors of The World Bank or the governments they represent. The World Bank does not guarantee the accuracy of the data included in this work. 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All other queries on rights and licenses, including subsidiary rights, should be addressed to the Office of the Publisher, The World Bank, 1818 H Street NW, Washington, DC 20433, USA; fax: 202-522-2422; e-mail: pubrights@worldbank.org. ISBN-13: 978-0-8213-8487-9 eISBN: 978-0-8213-8469-5 DOI: 10.1596/978-0-8213-8487-9 Library of Congress Cataloging-in-Publication Data Population aging: Is Latin America Ready? / Daniel Cotlear, editor. p. cm. — (Directions in development) Includes bibliographical references and index. ISBN 978-0-8213-8487-9 (alk. paper) — ISBN 978-0-8213-8469-5 (ebook) 1. Population aging—Social aspects—Latin America—Congresses. 2. Population aging—Social aspects—Caribbean Area—Congresses. 3. Population aging—Economic aspects—Latin America— Congresses. 4. Population aging—Economic aspects—Caribbean Area—Congresses. 5. Population aging—Health aspects—Latin America—Congresses. 6. Population aging—Health aspects— Caribbean Area—Congresses. 7. Older people—Latin America—Economic conditions. 8. Older people—Caribbean Area—Economic conditions. I. Cotlear, Daniel. HQ1064.L29P67 2010 305.26098—dc22 2010031650 Cover design by Quantum Think Cover photo by Gusjer@Flickr. v Preface xvii Acknowledgments xxi About the Authors xxiii Abbreviations xxvii Chapter 1 Population Aging: Is Latin America Ready? 1 Daniel Cotlear Introduction 1 Support of the Elderly and Poverty in the Life Cycle 16 The Impact of Population Aging on Health Status and Health Care Demand 22 The Impact of Population Aging on Public Expenditures 27 Conclusions and Implications 31 Notes 36 References 38 Contents Chapter 2 Demographic Trends in Latin America and the Caribbean 43 Paulo M. Saad Introduction 43 Trends in Mortality, Fertility, and Migration 44 Changes in Population Size and Age Structure 51 Demographic Transition, Dependency Ratios, and Demographic Dividend 55 Taking Advantage of the Demographic Dividend to Face the Challenges of Population Aging 64 Annex 2.1 Population Projection, Dependency Ratio, and Demographic Dividend under Different Demographic Assumptions 65 Notes 75 References 75 Chapter 3 Poverty, the Aging, and the Life Cycle in Latin America 79 Daniel Cotlear and Leopoldo Tornarolli Introduction 79 Demographic and Residence Indicators in Latin America 80 Poverty at Different Ages: Methodological Notes 83 Poverty at Different Ages: Empirical Evidence 87 Drivers of Old-age Poverty and the Role of Pensions and Other Transfers 101 The Labor Market and Old-age Poverty 113 Inequality among the Aging 118 Living Arrangements of the Aging and Familial Transfers 119 Conclusions 130 Notes 131 References 132 Chapter 4 How Age Influences the Demand for Health Care in Latin America 135 André C. Medici Introduction 135 Objectives, Data, and Concepts 136 vi Contents Health Needs in LAC 138 Trends in Health Care Utilization by Age in LAC 161 Health Expenditures and Health Costs by Age 172 Conclusions 180 Notes 183 References 185 Chapter 5 The Economics of Happiness and Health Policy: How Health Norms Vary across Cohorts in Latin America 191 Carol Graham The Economics of Happiness 193 Norms of Health: The Example of Obesity 198 Health Satisfaction in Latin America 200 Valuing Different Health Conditions in Latin America Based on the EQ-5D 201 Lessons for Policy 205 Notes 206 References 208 Chapter 6 Who Benefits from Public Transfers? Incidence across Income Groups and across Generations in Brazil and Chile 211 Cassio M. Turra, Mauricio Holz, and Daniel Cotlear Introduction 211 Methods 213 Benefit Incidence by Sector 215 The Incidence of Aggregate Public Expenditures 220 Larger Support for One Generation: Is there a Global Model? 225 Conclusions 228 Notes 230 References 231 Contents vii Chapter 7 The Fiscal Impact of Demographic Change in Ten Latin American Countries: Projecting Public Expenditures in Education, Health, and Pensions 233 Tim Miller, Carl Mason, and Mauricio Holz Introduction 233 The Influence of Demography and Policy on Current Levels of Public Spending 235 The Influence of Demographic and Policy Change on Future Public Spending on Education, Pensions, and Health Care 247 Fiscal Impact of Population Aging in Latin America 264 Notes 270 References 270 Index 273 Figures 1.1 A Century of Changes in the LAC Population Structure 6 1.2 Life Expectancy at Birth and Total Fertility Rate in LAC, 2005–10 7 1.3 The Economic Life Cycle in LAC 12 1.4 Population Over 60 Receiving a Pension, Percent 14 1.5 Poverty among Children and the Aging 17 1.6 Sources of Income for the Aging Population, Percent 20 1.7 Probability of Dying between the Ages of 5 to 59, (2001) 23 2.1 Life Expectancy at Birth in Selected LAC Countries, 1950–2050 46 2.2 Total Fertility Rate in Selected LAC Countries, 1950–2050 48 2.3 Natural and Total Growth Rates in LAC, by Country, 2005–10 50 2.4 Population Growth Rates by Major Age Group in LAC, 1950–2050 52 2.5 Population by Age Group in LAC, 1950–2050 53 viii Contents [...]... Organisation for Economic Co-operation and Development Pan-American Health Organization Pay-as-you-go Latin American Project for the Investigation of Obstructive Lung Disease National Household Survey, Brazil Purchasing power parity Survey on Health, Well-being and Aging in Latin America and the Caribbean (Salud, Bienestar y Envejecimiento en America Latina y el Caribe) Socio-Economic Database for Latin. .. aging in Eastern Europe, which rekindled a broader interest in demographic issues by the Bank.3 Population Aging: Is Latin America Ready? is an attempt to look broadly at issues related to population change in LAC, where the debate about population issues was fierce half a century ago, but later became silent The renewed interest in population is part of a growing awareness of the significance of population. .. status of the population and the demand for health care? And how advanced is the health transition in LAC? Third is an understanding of the fiscal pressures that are likely to Population Aging: Is Latin America Ready? 3 accompany population aging and to disentangle the role of demography from the role of policy in that process We seek to identify opportunities in these areas that may be missed by policy... next half-century will consist of a rapid aging of the population in most LAC countries This prospect should be a source of concern for policy makers for two reasons: first, income growth may become harder to attain in countries with large populations of older people, and second, meeting the needs of a large old-age population may be especially difficult in low- and middle-income countries This is partly... Population Studies About the Authors xxv Tim Miller is a Population Affairs Officer at the Latin American and Caribbean Demographic Center (CELADE) Population Division of the United Nations Economic Commission for Latin America and the Caribbean (UN ECLAC) He holds a Ph.D in Demography and a Master’s degree in Economics from the University of California, Berkeley Paulo M Saad is the Chief of the Population. .. PAHO PAYGO PLATINO PNAD PPP SABE SEDLAC SUS SVD UN Department of Economic and Social Affairs (of the United Nations Population Division) European Commission Directorate General for Economic and Financial Affairs, Economic Policy Committee and the European Commission Economic Commission for Latin America and the Caribbean (United Nations) (Comisión Económica para América Latina y el Caribe) Euro-quality... Peru Prior to his current appointment, he was the Lead Economist at the World Bank’s Human Development Department for the Latin America and the Caribbean Region At the World Bank, he has also served as Sector Leader for Human Development, covering the Andean countries; as health economist for Latin America; as macroeconomist in the Central America Department; and as Agricultural Economist in the Southern... Holz is a consultant at the Latin American and Caribbean Demographic Center (CELADE) Population Division of the United Nations Economic Commission for Latin America and the Caribbean (UN ECLAC) Carl Mason is a lecturer in the Department of Demography at the University of California, Berkeley; Director of the Demography Lab; and Director of Computing for the Center on the Economics and Demography of Aging. .. results of the technical debate among sector specialists in the case of health status We are pleased to contribute to the literature on issues related to aging and social policy in Latin America Preface Keith Hansen Sector Director, Human Development, Latin America and the Caribbean Region The World Bank xix Augusto de la Torre Regional Chief Economist Latin America and the Caribbean Region The World Bank... Disease Control Centro de Estudios Distributivos Laborales y Sociales, Universidad Nacional de La Plata Latin American and Caribbean Demographic Center (El Centro Latinoamericano y Caribeño de Demografía), a department of ECLAC Chronic obstructive pulmonary disease Cardiovascular disease Disability-Adjusted Life Year xxvii xxviii Abbreviations DESA DG ECFIN ECLAC EQ-5D GBD GDP HIV HNP IADLs IDB INTERHEART . 97 8-0 -8 21 3-8 48 7-9 eISBN: 97 8-0 -8 21 3-8 46 9-5 DOI: 10.1596/97 8-0 -8 21 3-8 48 7-9 Library of Congress Cataloging-in-Publication Data Population aging: Is Latin America Ready? / Daniel. index. ISBN 97 8-0 -8 21 3-8 48 7-9 (alk. paper) — ISBN 97 8-0 -8 21 3-8 46 9-5 (ebook) 1. Population aging Social aspects Latin America Congresses. 2. Population aging Social aspects—Caribbean