THE CHALLENGE OF ACHIEVING POLICY IMPACT Nathanael Goldberg, Policy Director

IPA has over 300 projects underway

What can go wrong? Taxonomy of policy failures Asking the wrong questions  (What are the right questions?) Losing control of the impact message Staying ahead of scale-up  Effective project, no scale-up  Not-so effective project, no scale-down  Unknown impact, scaling anyway Exogenous shocks

Microcredit: evidence from RCTs FMB: Manila, Philippines (Karlan and Zinman 2010)  Profits increase, but only for men  Effects stronger for higher-income entrepreneurs  Businesses shed employees Spandana: urban Hyderabad, India (Banerjee et al 2010)  1 in 5 new loans associated with opening business  No measured increase in household expenditures Morocco (Crepon et al 2011)  No increase in consumption, but switch to self-employment

Taking a step back: Returns to Capital Sri Lanka (de Mel et al 2008)  Men earn high returns to capital, but women do not Ghana (Fafchamps et al 2011)  In-kind or cash grants to men: significant returns  Cash grants to women: no return  In-kind grants (inventory or equipment) to women: significant returns  But, women with below-average profits (around $1 a day) saw no benefit from either form of grant

We can’t always write the headlines

Nor the anecdotes… After her husband died, Parwali had to work 14 hours a day in her vegetable stand to support two children – and she was still only bringing home $1 a day. Living in Bihar, Parwali’s life of hard work and poverty seemed inescapable. But a series of microloans changed everything. Today, four loans and two years later, Parwali’s business is growing, and with more income, she is now able to feed her family better, more nutritious food.

Policy impact? Source: CGAP Investment Growth (US$ billions)

More recent

Ultra-Poor Graduation Pilots  Holistic set of services for those too poor for traditional microfinance  Designed to move the ultra poor out of extreme poverty  Randomized evaluations in 7 countries Even when you think you’ve got it perfect…

Sometimes the world moves on without you

IPA’s Proven Impact Initiative Established to promote, finance, strengthen and expand the anti-poverty programs that have been proven through rigorous experimentation

“Tested and Proven” Interventions Commitment Savings School-based Deworming Chlorine Dispensers Remedial Education Investment Vouchers “Promising” Interventions: Reminders to Save Free Bednets Incentives for Vaccines

What’s our scorecard? Commitment Savings School-based Deworming Chlorine Dispensers Remedial Education Investment Vouchers

Deworming: big scale-up  2011: 17 million school-age children in all 38 districts were treated for parasitic worms by the Government of Bihar

Dispensers: doing it ourselves 2300 dispensers reaching 450,000 people But the need is huge

Remedial education Some progress, but lots of nudging required Scale-up and evaluation underway in Ghana Contract teachers as implemented by NGO and by government in Kenya

Failure to scale Commitment Savings and Investment Vouchers: both huge impacts, little progress on scaling Commitment savings:  Philippines: savings balances up 80%/300%  Malawi: 72% higher use of fertilizer, 61% higher crop sales at harvest, and 25% more spending on food post- harvest Fertilizer vouchers  Pre-payment as effective as a last-minute 50% subsidy in promoting fertilizer adoption

DrumNet Horticultural export and cashless micro-credit program linking smallholder farmers to commercial banks, retail providers of farm inputs, transportation services, and exporters. Impact: statistically and economically significant increase for first-time growers of export- oriented crops.

Coda One year after the evaluation ended, the export firm that had been buying the horticulture stopped because of lack of compliance with European export requirements Farmers returned to growing local crops

Thank You!