Dominique van de Walle. 1995 "Infrastructure and Poverty in Viet Nam." Living Standards Measurement Study, Working Paper No. 121, World Bank, Washington, D.C.
Viet Nam has poor physical infrastructure and high levels of income poverty. What role might better infrastructure play in reducing poverty in Viet Nam? This paper explores the link between poverty and lack of infrastructure using the 1992-93 Viet Nam Living Standards Survey. The household data indicate that although there are some regional and urban-rural imbalances, in general access to infrastructure is not very different between poor and non-poor infrastructure tends to be bad for everyone. Simulations of the potential benefits from an expansion of irrigation infrastructure and under certain assumptions about how it would be distributed, suggest that the policy would be redistributive, representing proportionately greater gains to the poor. The most pro-poor impacts would occur in Viet Nam's poorest regions and under a policy which targeted irrigation expansion to small per capita landholding households. The average annual economic rate of return of the irrigation investments considered would be at least 20 percent. The paper also finds evidence that various constraints over and above that presented by lack of irrigation appear to diminish the benefits of irrigation to poor and non-poor alike.
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Martin Ravallion. 1995 "Comparaisons de la Pauvreté : Concepts et méthodes." Living Standards Measurement Study, Working Paper No. 122F, World Bank, Washington, D.C.
Les comparaisons de la pauvreté qu'elles cherchent à déterminer si la pauvreté a augmenté, ou en quel endroit elle est la plus prononcé e sont généralement obscurcies par des imprécisions conceptuelles et méthodologiques. De quelle manière faut-il évaluer le "bien-être" des individus pour décider qui est pauvre? Une enquête auprès des ménages fournit-elle des indications fiables? Où faut-il placer le seuil de pauvreté, et le niveau choisi a-t-il de l'importance? Quelle mesure de la pauvreté doit-elle être utilisé e pour agréger les données sur le bien-être des individus? Son choix importe-t-il? La présente monographie propose des réponses à ces questions. Elle est axée sur les besoins de l'économiste ou de l'étudiant non spécialisé dans ce domaine, qui souhaite une présentation critique mais concise des travaux les plus récents. Elle examine les avantages et les inconvénients des méthodes antérieures et décrit un certain nombre de nouveaux outils d'analyse qui peuvent grandement faciliter les comparaisons de la pauvreté, tout en reconnaissant les incertitudes dont ces comparaisons sont entachées.
La monographie vise à fournir une introduction à la théorie et à la pratique, qui soit à la fois accessible et adapté e à un vaste auditoire. Son sujet touche à certaines branches bien établies de la science économique (notamment l'économie du bien-être et la théorie du consommateur) ainsi qu'à d'autres sujets (comme les statistiques et la nutrition). Je me contente, lorsqu'un sujet a été bien étudié dans d'autres études, de formuler quelques brèves remarques et de renvoyer le lecteur à d'autres sources.
La théorie de la mesure de la pauvreté est très générale, et s'applique en principe aux pays développés et en développement même si elle insiste manifestement dans ces deux cas sur des points différents. Pour illustrer la pratique de l'analyse de la pauvreté, j'ai choisi des exemples tirés uniquement de mes travaux, essentiellement pour les pays d'Asie en développement. Cette manière de procéder entraine un biais géographique certain (bien que celui-ci soit en faveur d'une région qui, d'après toutes les mesures raisonnables, abrite la majorité des pauvres du globe). La gamme des applications possibles est toutefois très vaste, et les points qui sont donnés en exemple susciteront, je l'espère, un vaste intérêt. J'ai également formulé certaines recommandations sur les travaux qu'il conviendrait de réaliser dans les années à venir.
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Masako Ii. 1995 "The Demand for Medical Care: Evidence from Urban Areas in Bolivia." Living Standards Measurement Study, Working Paper No. 123, World Bank, Washington, D.C.
This research analyzes the determinants of demand for medical services in urban areas of Bolivia. It also examines the possible trade-offs between cost recovery and the use of health services for different age, sex, ethnic, and income groups. The data used are from the third year of the Encuesta Integrada de Hogares (EIH), a multipurpose household survey conducted by the statistical office in Bolivia and the World Bank. The above data are used to estimate a multinomial logit model, and a nested multinomial logit model (choice of medical facilities by patients). The main empirical result of this research is that the demand for medical care is responsive to changes in price, but price elasticities are, in general, very low. This finding is comparable to that of research for other countries. Moreover, the price elasticity of demand falls as income rises. For children, the price elasticities are lower than for adults. Price elasticities do not vary much by ethnic group or gender, but estimation results show that Aymara speakers (an Indian group) are more likely to care for themselves. Probably there are cultural barriers that prevent Aymara speakers from seeking formal care. Our results also show that income and education are also important determinants of demand for medical care. For children, mother's education is far more influential than father's. Since price elasticities are so low, it suggests that there is potential for the Bolivian government to raise revenues by charging user fees. If additional revenues are not used to expand primary health care or to improve quality, imposing user charges on services may not substantially reduce inefficiency and/or inequity in the health sector.
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Jesko Hentschel and Peter Lanjouw. 1996 "Constructing an Indicator of Consumption for the Analysis of Poverty: Principles and Illustrations with Reference to Ecuador." Living Standards Measurement Study, Working Paper No. 124, World Bank, Washington, D.C.
This paper is concerned with the derivation of a welfare indicator for households from consumption data. It examines, illustrating with reference to data for Ecuador, several of the steps involved in constructing consumption aggregates and highlights some of the principles which should guide the analysis. The paper emphasizes that specific care is warranted where access is characterized by rationing. Simple methods are outlined to impute a hypothetical rent for owner-occupied housing, to include consumption of basic social services, and to calculate a stream of consumption derived from a stock of consumer durables. The paper demonstrates that the definition of consumption adopted can have a significant bearing on measured poverty, sending an important caution against comparisons of poverty based on different underlying consumption definitions. The paper illustrates that unlike specific measures of poverty, the profile of poverty may be quite robust to alternative consumption definitions. However, it argues that only after robustness has been firmly established should results be emphasized.
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Murray V. Leibbrandt, Christopher D. Woolard, and Ingrid D. Woolard. 1996 "The Contribution of Income Components to Income Inequality in South Africa: A Decomposable Gini Analysis." Living Standards Measurement Study, Working Paper No. 125, World Bank, Washington, D.C.
Much new work has been devoted to deriving and extending decomposable inequality and poverty measures which bridge the gap between description and analysis by throwing light on the processes undergirding inequality and poverty. For example, an application that has obvious policy relevance in the South African milieu is the use of decomposition techniques to partition inequality into within-race group and between-race group components.
This paper pushes forward such a programme by using a decomposition technique based on the Gini coefficient to discern the relative importance of the major income components in determining overall income inequality. Such analysis shows which income components are more important than others in causing income inequality within any racial group or, more generally, within any categorical partition of the total income sample. We extend this technique to include a discussion of the sensitivity of the Gini coefficient to marginal changes in income sources. The use of such a sensitivity analysis in conjunction with the decomposition analysis is very helpful in pointing to key labour market, state welfare and asset ownership patterns that are integral to the generation of inequality in South Africa or any other country with reliable income data. Finally, a welfare index is derived as a weighted combination of average income changes and distributional changes. This index shows how sensitive welfare is to small increases in income from various sources. We illustrate this welfare analysis for a range of different average and distributional weightings.
The paper uses data derived from a Living Standards Measurement Study survey undertaken in 1993 as part of the "Project for Statistics on Living Standards and Development in South Africa." The decomposition analysis is first illustrated using all African households. The bulk of the paper then applies our analysis to rural African households in the former homeland areas of South Africa as an example of how such work can make more specific inputs into policy debates. We first look at this rural sample as a whole and then we divide the sample into those households above a Household Subsistence Level and those households below this poverty line. Some concluding comments are then made.
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Margaret E. Grosh and Juan Munoz. 1996 "A Manual for Planning and Implementing the LSMS Survey." Living Standards Measurement Study, Working Paper No. 126, World Bank, Washington, D.C.
This manual explains the planning process, technical procedures, and standards used in Living Standards Measurement Study (LSMS) household surveys, including what these procedures entail, why they are used, and how they can be implemented. The "what" is the factual description of procedures and standards. The explanation of the "why" will help the reader to understand the importance of the different procedures. Moreover, if some aspect of them is to be changed or eliminated in a particular country, knowing what they were designed to achieve may aid the survey planner in finding an alternate strategy to accomplish the same objective. The "how" comprises explicit instructions, along with examples of ways the procedures have been adapted in different countries that have implemented LSMS surveys. Although the lessons presented here are derived from LSMS surveys, many of them are applicable to surveys generally, and especially to those that are complex or especially concerned with quality control.
Topics covered in this manual include the technical aspects of questionnaire formatting and testing, ways to implement a sample design, and what fieldwork and data management procedures have been successful. Ideas about directions to pursue in analyzing the data are sketched. A brief description of how to assess local statistical capacity is included. Generic work plans and budgets are presented to give ballpark estimates of how long each process will take and what must be included in a budget.
This manual will be useful to a broad spectrum of those who collaborate on an LSMS survey, including the staffs of the statistical agency, planning agency, university, or international development agency that will design, finance, implement, and analyze the survey, and technical assistants who are not familiar with LSMS survey practice. The authors have tried to write so that persons who are not specialists can read all parts of the manual.
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William Dow. 1996 "Unconditional Demand for Health Care in Côte d'Ivoire: Does Selection on Health Status Matter?." Living Standards Measurement Study, Working Paper No. 127, World Bank, Washington, D.C.
Health care demand price elasticities are often estimated from samples conditioned to include only sick people. This paper shows that not only may such estimates be statistically biased, but even when properly estimated they can only be interpreted as short-run price responses. In contrast, unconditional estimates take into account the long-run feedback of prices on health. The paper discusses simple strategies for estimating the long-run unconditional elasticities, which do not depend on controversial exclusion or functional form restrictions. Using the Côte d'Ivoire Living Standards Survey, a test based on the multinomial probit finds that the usual conditional estimates do not suffer from selection bias. However, short-run conditional estimates differ significantly from long-run unconditional ones for several covariates, with conditional price elasticities being about 25 percent larger than unconditional ones.
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Paul Glewwe. 1997 "How Does Schooling of Mothers Improve Child Health? Evidence from Morocco ." Living Standards Measurement Study, Working Paper No. 128, World Bank, Washington, D.C.
Mother's education is often found to be positively correlated with child health and nutrition in developing countries, yet the causal mechanisms are poorly understood. Three possible mechanisms are: (1) Formal education directly teaches health knowledge to future mothers; (2) Literacy and numeracy skills acquired in school assist future mothers diagnosing and treating child health problems; and (3) Exposure to modern society from formal schooling makes women more receptive to modern medical treatments. This paper uses data from Morocco to assess the role played by these different mechanisms. Mother's health knowledge alone appears to be the crucial skill for raising child health. In Morocco, such knowledge is primarily obtained outside the classroom, although it is obtained using literacy and numeracy skills learned in school; there is no evidence that health knowledge is directly taught in schools. This suggests that teaching of health knowledge skills in Moroccan schools could substantially raise child health and nutrition in Morocco.
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Stephen Howes and Jean Olson Lanjouw. " Poverty Comparisons and Household Survey Design." Working Paper No. 129, World Bank, Washington, D.C.
Poverty comparisons - an increasingly important starting-point for welfare analysis - are almost always based on household surveys. They therefore require that one be able to distinguish underlying differences in the populations being compared from sampling variation: standard errors must be calculated. So far, this has largely been done on the assumption that the household surveys are simple random samples. But household surveys are more complex than this. We show that taking into account sampling design has a major effect on standard errors for well-known poverty measures: they can increase by around one-half. We also show that making only a partial correction for sample design (taking into account clustering, but not stratification, whether explicit or implicit) can be as misleading as not taking any account at all of sampling design.
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Raylynn Oliver. " Model Living Standards Measurement Study Survey Questionnaire for the Countries of the Former Soviet Union.." Living Standards Measurement Study, Working Paper No. 130, World Bank, Washington, D.C.
This document presents a set of Living Standard Measurement Study questionnaires that have been developed for use in the Russian-speaking countries of the former Soviet Union. These questionnaires are available in English and in Russian. They are also available in electronic form.
This document also describes in detail the procedure that should be followed to modify the questionnaires for use in any specific country. Without careful tailoring, the questionnaires will be frustrating for interviewers and respondents. More importantly, if existing policies, policy concerns, and institutions are not taken into consideration, the survey data will not be sufficient to address the questions for which the survey is undertaken in the first place. To guide the questionnaire writer through the modification process, this document describes the important aspects of LSMS surveys, general modifications that will be required, translation and field testing procedures, and finally a section by section description of the type of modifications that are likely to be required to suit goals and circumstances.
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Sudhanshu Handa and Monica Neitzert. " Chronic Illness and Retirement in Jamaica." Living Standards Measurement Study, Working Paper No. 131, World Bank, Washington, D.C.
This paper explores the impact of six non-communicable chronic diseases (NCCDs) on the decision to retire among men and women aged 45-85 in Jamaica using the 1991 and 1992 Survey of Living Conditions data base. We find that the presence of a chronic disease has a significantly negative impact on remaining in employment among this population, that the effect of diabetes and hypertension are especially large, that there are substantial differences in the effects of chronic disease on retirement by gender, and that the presence of chronic diseases is more likely to lead to retirement among the lower socioeconomic classes and among upper class men. Because the use of NCCDs in this type of analysis is rare, we perform a sensitivity analysis to control for potential measurement issues which confirms the significance of chronic diseases as a factor in early retirement. Our findings suggest the need to integrate health and labor market policies.
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Paul Glewwe and Harry Anthony Patrinos. " The Role of the Private Sector in Education in Vietnam: Evidence from the Vietnam Living Standards Survey." Living Standards Measurement Study, Working Paper No. 132, World Bank, Washington, D.C.
As part of the restructuring of the education system since doi moi or Renovation in 1989, the government of Vietnam has implemented several policy changes. These include transforming some public institutions into private ones, promoting the establishment of "people's" and community educational institutions, and permitting the establishment of private institutions. Since the move from a centrally planned economy to a market economy is very recent, it is not surprising that private schools are relatively rare in Vietnam. This paper uses data from the 1992-93 Vietnam Living Standards Measurement Survey (VLSS) to examine the nature of private schooling in Vietnam.
Estimates of the determinants of the choice among public, private and semi-public schools indicate that better off households are less likely to send their children to semi-public schools but more likely to send them to private schools. Estimates of the determinants of private (household) expenditures on education show that willingness to spend on education increases as the incomes of Vietnamese households rise. Results also suggest that the marginal cost to households of switching from public to private schools may be small; in particular, there is little additional cost associated with attending semi-public schools, and only very small (and not statistically significant) additional costs to attending a private school. No significant effects of religion or ethnicity are found, except that the Chinese have a higher level of schooling attainment and are more likely to attend private schools. Wage regressions indicate that individuals who attended private school receive higher wages than individuals with the same level of school attainment who attended public schools. The importance of parental education, especially mother's education, as a determinant of children's ultimate attainment is confirmed. One implication of this is that any targeting efforts, such as the provision of scholarships or vouchers, should consider using parental education to determine eligibility.
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Martin Ravallion. " Poverty Lines in Theory and Practice." Living Standards Measurement Study, Working Paper No. 133, World Bank, Washington, D.C.
A poverty line helps focus the attention of governments and civil society on the living conditions of the poor. In practice, there is typically not one monetary poverty line but many, reflecting the fact that poverty lines serve two distinct roles. One role is to determine what the minimum level of living is before a person is no longer deemed to be "poor." The other role is to make interpersonal comparisons; poverty lines for families of different sizes and compositions, living in different places, or for different dates, tell us what expenditures are needed in each set of circumstances to ensure that the minimum level of living needed to escape poverty is reached.
Both roles matter to the credibility of the resulting poverty measure, such as the popular "headcount index," given by the proportion of the population living below the relevant poverty line. Economists have given surprisingly little attention to the first role. While they have studied the problem of how data on the distribution of welfare should be aggregated into a single measure of poverty, given a poverty line (and the weaknesses of the headcount index are becoming well understood), the problem of how one sets a poverty line has been largely ignored. Economists have given a great deal of attention to the second role, in the context of the general issue of welfare measurement, though the lessons learned have often been ignored by practitioners measuring poverty. Experience suggests that the choices made in setting poverty lines can matter greatly to the measures obtained, and to the inferences drawn for policy.
This paper offers a critical overview of alternative approaches to setting poverty lines, keeping both roles in mind. It argues that a "poverty line" can be interpreted within the approaches to welfare measurement found in economics based on the consumer's expenditure function, giving the cost of a reference level of utility. However, the paper also argues that this approach leaves some key questions unanswered, and hence it makes a rather hollow theoretical foundation for applied work. The paper then argues that the methods of setting poverty lines found in practice can be interpreted (implicitly at least) as attempts to address those questions, by drawing on information which is not normally employed in economic analysis. That information includes data on "capabilities," which can be interpreted as a useful intermediate space for making welfare comparisons, between the spaces of "utility" and "commodities" which are more familiar to economists. Measurement practice has sometimes also turned to information on subjective (self-rated) assessments of well-being, often discounted by mainstream approaches to "objective" welfare measurement favored by economists.
In critically reviewing the methods found in practice, the paper tries to throw light on, and go some way toward resolving, ongoing debates about poverty measurement, emphasizing those issues which would appear to have greatest bearing on policy discussions. Some methods found in practice seem to make more sense than others. Some methods work well in one setting but not others. There is no single ideal and generally feasible method, but it does appear to be possible to identify a reasonably defensible subset of the existing methods which should adequately serve the data needs of policy makers.
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Harold Alderman. " Social Assistance in Albania: Decentralization and Targeted Transfers." Living Standards Measurement Study, Working Paper No. 134, World Bank, Washington, D.C.
Albania provides a small amount of social assistance to nearly 20% of its population through a system that allows a degree of community discretion in determining distribution. This study investigates the poverty targeting of this program. It indicates that relative to other safety net programs in low income countries, social assistance in Albania is fairly well targeted to the poor. Moreover, the poverty targeting exceeds that which could be expected on the basis of proxy indicators of targeting alone; communes appear to be using local information. Nevertheless, a large number of poor are excluded from social assistance. Moreover, the system is hampered by the absence of a clear objective criterion to determine the size of the grants from the center to communes and limited information that might be used to implement this criterion.
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Angus Deaton and Salman Zaidi " Guidelines for Constructing Consumption Aggregates for Welfare Analysis." Living Standards Measurement Study, Working Paper No. 135, World Bank, Washington, D.C.
An analyst using household survey data to construct a welfare metric is often confronted with a number of theoretical and practical problems. What components should be included in the overall welfare measure? Should differences in tastes be taking into account when making comparisons across people and households? How best should differences in cost-of-living and household composition be taken into consideration? Starting with a brief review of the theoretical framework underpinning typical welfare analysis undertaken based on household survey data, this paper provides some practical guidelines and advice on how best to tackle such problems. It outlines a three-part procedure for constructing a consumption-based measure of individual welfare: (i) aggregation of different components of household consumption to construct a nominal consumption aggregate, (ii) construction of price indices to adjust for differences in prices faced by households, and (iii) adjustment of the real consumption aggregate for differences in household composition. Examples based on survey data from eight countries – Ghana, Vietnam, Nepal, the Kyrgyz Republic, Ecuador, South Africa, Panama, and Brazil – are used to illustrate the various steps involved in constructing the welfare measure, and the STATA programs used for this purpose are provided in the appendix. The paper also includes examples of some analytic techniques that can be used to examine the robustness of the estimated welfare measure to underlying assumptions.
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