the sequencing of choices. Nonetheless, we conduct a series of checks that allow us to test how modifying assumptions at different stages of the implementation of the methodology would affect our estimates. Results remain qualitatively similar, showing that our preferred poverty lines are robust to alternative choices and assumptions regarding the preferred specification.

Interestingly, the value of the (lower) total poverty line found here is close to the income threshold used to define eligibility to register in the Cadastro Único (R$477, or half a minimum wage in 2018). Thus, results could be interpreted as providing empirically backed evidence of the relevance of such a value as a way to identify the destitute and vulnerable populations in Brazil.

The rest of the note is structured as follows: Section 2 describes the methodology to estimate the poverty line and the data. Section 3 presents results and section 4 covers the different robustness checks performed. Section 5 concludes.

2. Applying a cost-of-basic-needs approach to estimate a poverty line The cost-of-basic-needs approach The cost-of-basic-needs (CBN) approach, first taken by Rowntree (1901), has become a staple approach in studies that aim to estimate poverty lines. For instance, in the region, poverty lines of Argentina (INDEC, 2016), Mexico (CONEVAL, 2019), Paraguay (DEGEEC, 2020), and Ecuador (INDEC 2015) are based on the CBN approach, as well as in other upper middle-income economies like Lebanon.<sup>3</sup> Put simply, it consists of stipulating a certain bundle of basic needs that is then costed to come up with a monetary value that would allow individuals to satisfy these basic needs. The bundle of basic needs is chosen using consumption choices made by a relevant reference population.

The approach results in three poverty lines: a food poverty line and two (total) poverty lines that incorporate adjustments for nonfood basic needs to the food poverty line and are commonly called the lower and upper poverty line. The approach usually involves the following steps. First, the food poverty line (FPL) is estimated. The FPL conceptually stipulates the cost of achieving a minimum threshold of caloric consumption in the reference population. The first component – a minimum calorie requirement – is obtained from the country’s nutritional tables, recommendations from the Ministry of Health, or another local authority on the subject. Depending on data availability, the minimum calorie requirement is obtained from international sources that may be applicable to the context at hand. The cost of achieving this minimum calorie requirement is then usually calculated on the basis of information from a household expenditure survey by estimating the average cost of a calorie. Such an average is estimated from the value of food consumption (and its associated expenditure) in the household survey and from the calories associated with the observed level of consumption. Calories consumed by food item are generally obtained from a reliable external source. The cost per calorie of different food items is thus estimated and aggregated to get a representative value. Notably, the cost per calorie is based on information from a reference population. This reference group is chosen because it is deemed that its consumption patterns (including the basket of goods and services it purchases) are most relevant to inform the estimation of

> 3 The poverty line used for targeting of social programs is based on the CBN (World Bank 2021).

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