A few months back, I can’t remember which of the pro-Chavez pseudo-economists was suggesting that the January devaluation would have very little impact on the Venezuelan poor, because of the programs like Mercal, PDVAL and the like the Government had in place to aid them. A few years back I actually posted an estimate of how inflation hits the different classes in Venezuela, but that data was outdated.
But the graph above, courtesy of the data from the Venezuelan Central Bank and published by El Universal, shows it with real and very recent data for the first eight months of the year. Level I (Dark line with solid dots) corresponds to the lowest strata of the population under the BCV’s definition. As you can see, the devaluation had the opposite effect, in the months following the devaluation they felt the most impact, an effect that still lingers to this date, wth an accumulated inflation of 21.7%. The second lowest strata is next, up 21.6%, Level III has had 21% inflation and the well-off have had 19.1% so far in 2010, proving that it is actually the other way around.
No mystery here, it is the poorest who spend the most on food and it has been food, despite the Government controlling certain basic staples, that has gone up the most.