Casa Presidencial seized on the latest household income survey to announce Thursday that poverty has declined in the country.
The aides to President Luis Guillermo Solís also announced that the survey shows that 16 percent of the population have 50 percent of the riches.
The presidential claims were based on the Encuesta Nacional de Hogares 2015 conducted by the Instituto Nacional de Estadística y Censos.
The claim of reduced poverty was picked up uncritically by a number of news outlets. Casa Presidencial said that 32,753 persons have risen from poverty, presumably aided in whole or part by the administration’s four-pronged policies. That number was gleaned from the reported decline in poverty of 0.7 percent from 2014.
The claim is good politics, but not supported by the numbers. The probability survey was the result of individual interviews with a selected sampling. So the results have to be given along with a sampling error, a confidence interval or a margin of error.
Neither Casa Presidencial nor the statistics agency did this. In fact, the methodology, including the number of homes samples, has not yet been given.
Still a difference of just 0.7 percent between 2015 and 2014 data clearly is within the mathematical range where the results are identical statistically.
So it is safe to say that there are about 317,660 homes with 1,137,881 persons living in poverty, according to what survey takers were told. That’s an estimated 21.7 percent of the homes and 23.6 percent of the population, according to the statistical agency.
Casa Presidencial promoted the Solís administration sales tax rebate plan as a way of reducing the inequality of riches. The administration is trying to get a 14 to 15 percent value-added tax passed by the legislature. Some say such a tax is regressive and hurts the poor, so the administration said it would refund the estimated tax paid to the bottom quarter of income earner. But that would take two years, according to the bill.
There is another problem with the administration’s take on the new statistics. The statistical agency cited a Gini index of .526, and Casa Presidencial said that 16 percent of the population has 50 percent of the riches.
However, the index, created by the Italian statistician Corrado Gini in 1912, is a measure of income distribution and not the distribution of assets or riches. Most modern developed countries had an index of from .5 to .7.
There were these other revelations by the statistical agency:
• average net income declined by .5 percent in 2015 and net income per person increased about 2.4 percent to 356,648 colons ($675.50) a month. The statistical report attributed this income increase, if there was a real change, to a reduction in the size of families.
• As an indication of sampling error with subpopulations, the agency reported that household income in the Región Chorotega increased neaerly 22 percent over 2014 to 830,707 colons ($1,573).
• The top 20 percent of household incomes averaged 1,035.703 colons ($1,952) a month per person, and the bottom 20 percent had an income of 54,556 colons ($103.35) per person.
• Those households in extreme poverty were reported as 7.2 percent, which was a half a percent higher than 2014, still probably within the margin of error. That is 104,712 homes and 374,185 persons, said the agency.
• Homes in poverty have an average of .43 children five years or less against .22 percent in homes not listed as poor.
• The average education level of those living in poverty homes was 6.4 years of formal education. Those not in homes in the poverty category had an average education level of 9.2 years.