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Effects of income supplementation on health of the poor elderly: The case of Mexico

Significance Effects of income support on well-being and health of the poor elderly especially in low-income country settings is uncertain as experiments that increase incomes and evaluate their impacts on health among the elderly population are almost nonexistent around the world. In our experiment in the Mexican state of Yucatan, we find strong evidence that income supplements for the poor elderly in low- and middle-income settings can have significant health benefits even in the short run. Additional experiments should be conducted around the world as our experience indicates that these experiments are operationally feasible. We use an income supplementation experiment we designed in the state of Yucatan in Mexico for residents 70 y and older to evaluate health impacts of additional income. Two cities in the State of Yucatan, Valladolid (treatment) and Motul (control), were selected for the income supplementation experiment. Elderly residents of Valladolid were provided the equivalent of an additional $67 per month, a 44% increase in average household income. We designed a survey given to residents of both cities before and 6 mo after the income supplement about their health and other aspects of overall well-being. Both baseline and follow-up surveys collect self-reported data on health, physical functioning, and biomarkers. Anthropometric measurements for every age-eligible respondent, including height, weight, and waist circumference, were collected. We also collected lung capacity, grip strength, a series of balance tests, and a timed walk. Our results show significant health benefits associated with the additional income. Relative to the control site, there was a statistically significant improvement in lung function and an improvement in memory. These improvements are equivalent to a reduction in age of 5–10 y. Residents used their extra income to go to the doctor, buy their medications, and alleviate their hunger. The fear that this extra income could be undone by reduced transfers from other family members or unwise expenditures by the poor elderly appears to be unfounded.