Regional Poverty Analysis and Monitoring Workshop Tara Vishwanath (World Bank) Islamabad, Pakistan March 18-23, 2002

Poverty Reduction Approaches Conceptual Underpinnings Eighties saw an almost exclusive focus on growth – income based poverty The nineties complemented growth with capabilities- health, education, nutrition This is now further expanded to include vulnerability, voice, and power.

Dimensions of Poverty Lack of Opportunity Low Capabilities Low levels of security Empowerment These are highly interrelated and complementary

Dimensions – contd. Each dimension represents an evolution of development thinking - Criticality of markets - Criticality of institutions- private, public, political Resources need to be complemented with the “right” incentives for effectiveness.

Substantive Challenges Creating Opportunity Design interventions to account for institutional realities and distributional and welfare impacts of policy Increase support to “pro-poor” growth approaches- as in promote market activities for the poorer groups Focus on building assets of the poor: –Redistribution –Service delivery issues

Substantive Challenges Improving Security Reduce vulnerability: from the macro to household level to lessen impact of shocks Increase capacity at the household and aggregate levels to mitigate and cope with risk Pay heed to existence of informal mechanisms in the design of interventions

Substantive Challenges Enabling Empowerment Enhance capability of people to “influence” their own lives Strengthen participation of poor in decision making; make institutions more responsive to needs of the poor Improve governance and accountability of state institutions Reduce exclusionary social and institutional barriers.

The PRSP Framework PRSP initiative embodies the themes of the conceptual framework –Opportunity –Security –Empowerment Lending Instruments capture these ideas –Poverty Reduction Support Credits (PRSC) –Investment lending for capacity building, learning, innovation

Implementation Challenges Enhance knowledge base on poverty and interrelated characteristics Link public actions to these observations and analyses Improve incentives for better performance

Enhancing the Knowledge Base on Poverty The conceptual framework poses enormous demands on data at various levels: –The country level aggregates –The community level –The household level –The Individual level –Time series/panel –Administrative data The list continues ……

How Much Poverty? Trends? Extent of Poverty: Its breath, depth, severity –Consumption/income aggregates at household level.. (HIES type data) –Regular intervals.. For consistent trends (every three to five years) –Consistent methods for tracking consumption- for comparability –Indicators of extent, depth, severity –Panels useful for vulnerability and income mobility exercise

Who are the poor? Characteristics of Poverty –Extended multi-topic household surveys measuring social indicators, living conditions, wages, sources of income…. –Disaggregated information for discerning patterns across gender, rural/urban, ethnicity, etc –Facility and community surveys to identify key constraints to access markets and services

Why are they poor? Beyond constraints of income and access- to understand processes and behavior that impede poverty reduction –Qualitative and institutional data –User surveys –Participatory surveys to understand household priorities and perceptions –Political economy issues.. Scope for collective action

Data Needs and Sources: Summary : GDP, consumption, investment, exports, imports, etc System of National Accounts, trade statistics National Central Statistical Agency Public Finance Data: revenues, expenditures by category Budgets and actualsMinistry of Finance, central and sectoral ministries Consumer and producer pricesPrice, wage surveysCentral Statistical Agency, central Bank Climatic Data: temperature, rainfall, etcDirect MeasurementNational Weather Agency Availability of servicesCommunity serveys, multi topic household surveys, qualitative studies Local administration, sectoral ministries Use of servicesTracking surveysLocal service providers Individual and Household: consumption and income, living conditions, social indicators Household budget/expenditure/income surveys, multi topic household surveys Central statistical agency, ministry of labor/employment Household Priorities: perceptions of poverty, usder satisfaction Qualitative studies/user surveysCentral statistical agency, sectoral ministries, others Political economy issuesQualitative studies, electoral dataLocal authorities, etc

Analysis Define indicators and benchmarks for key dimensions of poverty Improve Poverty Monitoring systems and capacity Enhance diagnostic techniques to reflect multidimensional concept of poverty -appropriate indicators, tools -qualitative and quantitative

Examples of Indicators GoalIndicators (Intermediate) Indicator- Final (Outcomes and Impact ) Reduce extreme poverty and expand economic opportunities for the poor Expenditure on employment programs for the poor No. of beneficiaries of the employment program Incidence of extreme poverty: percentage falling below the poverty line Poverty Gap ratio Enhance capabilities of poor men and women Expenditures on primary education as share of total on education Exp. On primary health care New schools built No of primary school teachers Net enrollment in primary Percentage of poor with access to health care facilities Number of doctors per 100,ooo inhabitants Literacy rates Learning Achievement Drop out and repetition rates Infant, child and under five mortality rate Malnutrition rate Life expectancy Reduce Vulnerability of the poorExpenditure on safety net programs Number of poor receiving transfers from govt Number of persons protected from shocks (drought) as percentage of total affected Prevalence of insurance (formal and informal)

Linking Public Action to Poverty Outcomes Use information from analysis - for strategy formulation - priority setting - design of key interventions Develop tools for assessing social and poverty impact of public action Strengthen focus and capacity for monitoring Sustain the link between analysis, feedback and action

Role of International Community Work off the PRS of countries- country ownership is key Facilitate implementation challenges: –Capacity building –Knowledge exchange and creation –Sustaining efforts – recognition of the fact that such efforts take time