A History of Social Protection in Latin America: From Conquest to Conditional Cash Transfers

Abstract

This paper reviews the development of the Latin American welfare state since the conquest, illustrating how initial factor endowments arrested the development of inclusive social policies. With industrialization social insurance was expanded to urban working and middle classes, however, it took the debt crises of the 1980s, rather than democracy, to prompt the creation of effective social assistance policies in the form of Conditional Cash Transfers (CCTs). Unlike previous social assistance policies, CCTs are better targeted to the poor, and have succeeded in increasing income while improving human development indicators. They have not, however, changed the essential paradigm of the Latin American welfare state, which is still characterized by a two-tier system: the rich have separate and better quality protection than the poor, as well as access to better health and education services. Thus while CCTs are tranquilizers—some might even call them populism—they are not a cure for existing inequalities, and might even delay the creation of a truly inclusive welfare state.

Keywords

• Latin America
• Conditional Cash Transfers
• Social Protection
• Social Assistance
• Social Insurance
• Poverty Reduction