Poverty and the distribution of income

Both absolute and relative poverty got worse in Brazil during the 1980s as a result of the economic recession and the state's unsuccessful efforts to tackle inflation. Relative inequality improved slightly during the 1970s and deteriorated during the 1980s. Inequality worsened during the 1980s in Brazil's three largest metropolitan areas. It also shows that inequality was greater in Rio than in either São Paulo or Belo Horizonte in both 1981 and 1989. Indeed, the situation in Rio has deteriorated faster than in any other metropolitan area. By 1989, Rio had the most unequal distribution of income of any metropolitan area in Brazil; during the 1980s it had displaced even the cities of the north-east from first place.

Absolute poverty also increased dramatically during the 1980s and, in 1991, some 3.5 million people were living below the poverty line. However, the increase in poverty was reflected more in the rising proportion of poor families than in the level of immiseration. The average income of families living below the poverty line in Rio remained constant between 1981 and 1989. The pattern was very similar in São Paulo and Belo Horizonte. Like relative poverty, however, absolute poverty appears to be far worse in Rio than in the other two cities. São Paulo has a far lower share of its people living below the poverty line. In fact, Rio had a higher proportion of its population living in absolute poverty than the Brazilian metropolitan average of 28.1 per cent.

Favelas

Rio de Janeiro, like most third world cities, is experiencing a dramatic increase in population. This increase has come mostly in the form of the rural poor migrating to the cities. Because of the high land values and the enormous demand for space, these poor are forced into squatter settlements known as favelas. Named after the location of the first such settlement, the hill Morro da Favela, these settlements usually occur in two areas of Rio: one, along the steep hillsides or, two, along the outer fringes of urban expansion.

The most famous favelas are those build along the hillsides. The houses are usually made first from wattle-and-daub, a mixture of sand and clay, and eventually to the use of wood, brick and sheet metal. One can tell the length of time that each family has lived in the favela by the type of material the ir house is made of and its location. Usually the first settle near the bottom of the hills and as time goes by the hill fills upward. Since their is no rent to pay, the money saved is used to purchase stronger materials such as brick and cinder blocks. These are then used to modify and solidify the structure. Houses are only upgraded if the site is safe from landslides and demolition by the city.

The first recorded favela was in the early 1920's, made up of about 839 of these houses, even though squatter settlements have existed in Rio since the late 1800's. The first of these favelas were located on the hillside because of no rent and their central location to the city, utilities and work. Today, there are over 500 favela communities existing within the city of Rio and comprise about a third of the total population. Five-hundred thousand to 1 million are estimated to live on the hillsides directly surrounding the CBD. While the city of Rio is growing at 2.7% a year, the favelas are growing at a rate of 7.5% a year. This massive and uncontrolled urbanization has extended Rio's utilities and infrastructure passed their limit. The favelas are the ones that suffer.

Rio is not the only city with these types of squatter settlements, but it was one of the first. What makes the favelas so unique for Rio is their location on the steep hillsides. Here the extremely poor live on the hillside with the scenic views while the rich live along the bottom where conditions are less than favorable. Not only is the direct opposite of city development around the world, but it creates a dramatic contrast between the rich and the poor by putting the two directly next to one another. This is one of the advantages to livingin this type of favela. The rich provide many of the jobs, in way of services, that help sustain the the livelihood of the faveladors. Many of the rich rely on the cheap labor and service jobs that the faveladors supply, but this does not quell the criticism and negative image that they evoke.

Learn more about favelas