How does the World Bank contribute to poverty measurement at the country level?
The World Bank is recognized as a leading provider of objective, unbiased data. As part of its mission to end extreme poverty, the World Bank engages with governments to provide technical assistance and help them achieve the most accurate statistical picture of their economies to inform their policymaking.
What are the issues relating to Rwanda poverty data measurement?
In Rwanda, the objective of the World Bank’s technical assistance is to help the National Institute of Statistics of Rwanda (NISR) examine its official methodology and explore ways to further improve it. The World Bank Rwanda poverty team recognizes that NISR’s methodology is technically sound and provides evidence that there was a reduction in Rwanda’s poverty rate between 2010/11 and 2013/14, while noting that an inconsistency between two measures of inflation requires further research.
The key issue of Rwanda poverty measurement between 2010/11 and 2013/14 is that the consumer price index (CPI) and the NISR price index, called the Cost of Living Indicator (COLI), do not seem to be consistent. The national CPI shows that the inflation rate between 2010/11 and 2013/14 is 23%. NISR’s COLI uses the same CPI data, and the results show Kigali’s inflation rate is very similar to the national CPI trend, but other regions show very different trends. Further, the national average of COLIs show only around 5 percent for the same period, although there is no clear theory to guarantee that the national average of COLIs and the national CPI need to be consistent.
Is NISR’s approach flawed?
A working paper by Fatima and Yoshida (2018) found NISR’s 2016 approach – the latest official methodology – to be technically sound, but the inconsistency between CPI and COLI needs further research. The working paper, “Revisiting the Poverty Trend in Rwanda: 2010/11 to 2013/14,” is publicly available. NISR and World Bank teams are initiating a new joint research program, which will start in May 2019.
Is there any evidence that NISR manipulated poverty estimates?
No. NISR made all survey data and questionnaire as well as full documentation of their poverty measurement methodology freely available to anyone on their website. NISR has been fully open to any questions and requests from the World Bank team. Indeed, NISR welcomed technical views on their methodology and expressed strong interest in benefiting from global best practices. We have not found any clear sign of errors or manipulations.