Over the last decade, a policy revolution has been underway in the developing and emerging world. Country after country is systematically providing non-contributory transfers to poor and vulnerable people, in order to protect them against economic shocks and to enable them to invest in themselves and their children.
... See More + Social safety nets or social transfers, as these are called, have spread rapidly from their early prominence in the middle-income countries of Latin America and Europe increasingly to nations in Africa, Asia and the Middle East - and today, over 130 developing countries have made investments in social safety nets an important pillar of economic development policies. The statistics and analysis in The State of Social Safety Nets 2015 capture this revolution, and reveal it in many dimensions at the country, regional, and international levels. This latest edition of a periodic series brings together a large body of data that was not previously available, drawing on the World Bank's ASPIRE database and other sources. Why have so many countries made a firm commitment to incorporate social safety nets as part of their social and economic policy architecture? Because social safety nets work. This report also reports on the rigorous evidence that demonstrates their impact, and also points the way to making them even more efficient and effective at meeting their development goals. This latest edition of a periodic series brings together a large body of data that was not previously available, drawing on the World Bank's ASPIRE database and other sources to examine trends in coverage, spending, and safety nets program performance.
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Most countries in the world aspire to protect poorest and most vulnerable families from destitution and thus provide some type of income support to those who are very poor.
... See More + These programs are often layered into social policy along with other transfers, subsidies, or services. The way to best provide such last-resort income support (LRIS) and its role in wider social policy is a matter of some complexity, much experimentation, and much study. In Eastern Europe and Central Asia, 28 of 30 countries operate LRIS programs. This study examines the experience of LRIS programs in Eastern Europe and Central Asia. It documents the outcomes of such programs throughout the region in terms of expenditure, coverage, targeting, and simulated effects on poverty and inequality. For a subset of countries, the study documents and draws lessons from the design and implementation arrangements - institutional frameworks and administrative structures, eligibility determination, benefits and conditions, governance mechanisms, and administrative costs on the basis of information gleaned during in-depth country engagements that have extended a decade or more (Albania, Armenia, Bulgaria, the Kyrgyz Republic, Lithuania, and Romania) and other detailed work available from newer or more specific engagements (Croatia, the Russian Federation, Serbia, Ukraine, and Uzbekistan). The report is organized as follows: chapter one gives introduction. Chapter two provides an overview of the role of LRIS in the wider social assistance policies of Eastern Europe and Central Asia. Chapter three looks into the institutional and financing arrangements of the LRIS programs in the case study countries. Chapter four covers one of the two most charged issues in narrowly targeted LRIS programs - how eligibility is determined. Chapter five takes up the other charged issue in these programs - the benefit formula and how labor disincentives can be held in check with the guaranteed minimum income design. Chapter six focuses on two key elements of control and accountability systems in LRIS programs - modern management information systems and strategies to reduce error, fraud, and corruption. Chapter seven examines the administrative costs of the LRIS programs in the case study countries. Chapter eight highlights and summarizes the lessons.
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This publication begins a series that will monitor and report on social safety nets in developing countries. This first report in the series provides key social safety nets statistics and explains trends using information from 146 countries, including detailed household survey data from 69 countries in the World Bank's Atlas of Social Protection: Indicators of Resilience and Equity (ASPIRE) database.
... See More + This report reviews important policy and practical developments in social safety net programs and highlights emerging innovations. While the primary focus is on developing and emerging countries, it also includes some references to high-income settings.
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This paper is organized in following headings: how can safety nets contribute to economic growth?; political reforms and public policy: evidence from agricultural and food policies; food security and storage in the Middle East and North Africa; preferential market access design: evidence and lessons from african apparel exports to the united states and the European Union;network proximity and business practices in african manufacturing; the impact of financial literacy training for migrants; policy barriers to international trade in services: evidence from a new database.
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Publication 113048 JAN 01, 2014
Alderman,Harold H.; Yemtsov,Ruslan G.; Olper,Alessandro; Fałkowski,Jan; Swinnen,Johan F. M.; Larson,Donald F.; Lampietti,Julian A.; Gouel,Christophe; Cafiero,Carlo; Roberts,John; De Melo,Jaime A. P.; Portugal-Perez,Alberto; Fafchamps,Marcel; Soderbom,Mans Martin; Gibson,Jhon; Mckenzie,David J.; Zia,Bilal Husnain; Borchert,Ingo; Gootiiz,Batshur; Mattoo,AadityaDisclosed
This paper provides an up-to date and selective review of the literature on how social safety nets contribute to growth. The evidence is carefully chosen to show how safety nets have the potential to overcome constraints on growth linked to market failures, and is organized into four distinct pathways: i) encouraging asset accumulation by changing incentives and by addressing imperfections in financial markets caused by constraints in obtaining credit, and from information asymmetries; overcoming such failures helps households to invest into their human capital or productive assets; ii) failures in insurance markets especially in low income setting; safety nets are assisting in managing risk both ex post and ex ante; iii) safety nets are overcoming failure to create assets and other local economy complementary factors to household-level investments; iv) safety nets are shown to relax political constraints on policy.
... See More + Safety nets have a dual objective of directly alleviating poverty through transfers to the poor and of triggering higher growth for the poor. However, the trade-off between the dual objectives of equity and growth is not eliminated by the potential for productive safety nets; this remains critical for designing social policies.
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This brief summarizes the results of a gender impact evaluation study, entitled Combining longitudinal household and community surveys for evaluation of social transfers : infrastructure rehabilitation projects in rural Georgia, conducted between 1998 and 2002 in Georgia.
... See More + The study observed the impact of infrastructure rehabilitation projects on household well-being in rural Georgia on the community level. Improvements in school infrastructure produced significant gains in school enrollment rates, school attendance, and health risks of school-aged children. Road and bridge rehabilitation led to increased economic indicators at the community level. The number of small and medium enterprises (SMEs) increased while barter trade fell. The impact of road projects is insignificant. School attendance and children's health improved more among the poor than among the better-off. Female off-farm employment is significantly improved amongst the poor and non-poor.
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The paper provides an up-to date and selective review of the literature on how social safety nets contribute to growth. The evidence is carefully chosen to show how safety nets have the potential to overcome constraints on growth linked to market failures, and is organized into 4 distinct pathways: i) encouraging asset accumulation by changing incentives and by addressing imperfections in financial markets caused by constraints in obtaining credit, and from information asymmetries; overcoming such failures helps households to invest into their human capital or productive assets; ii) failures in insurance markets especially in low income setting; safety nets are assisting in managing risk both ex post and ex ante; iii) safety nets are overcoming failure to create assets and other local economy complementary factors to household-level investments; iv) safety nets are shown to relax political constraints on policy.
... See More + Safety nets have a dual objective of directly alleviating poverty through transfers to the poor and of triggering higher growth for the poor. However, the trade-off between the dual objectives of equity and growth is not eliminated by the potential for productive safety nets; this remains critical for designing social policies.
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Policy Research Working Paper WPS6437 MAY 01, 2013
Social protection is absent from the Millennium Development Goals (MDGs), and only recently has gained some prominence in the post-2015 discourse.
... See More + In the past quarter century, however, rising inequality has often accompanied economic growth. At the same time, the growing importance of risk and vulnerability on the wellbeing of the poor has been recognized. Further, there is now a consensus on adopting more ambitious goals on poverty reduction. Defining social protection as a collection of programs that address risk, vulnerability, inequality and poverty through a system of transfers in cash or in kind, this paper argues that social protection needs to be on the post-2015 agenda as a key element of the discourse. It provides an empirical overview of social protection around the world based on the World Bank's Atlas of Social Protection: Indicators of Resilience and Equity (ASPIRE) data set. Focusing on the goal of ending poverty, the paper estimates that social protection programs are currently preventing 150 million people from falling into poverty. Based on the data set, the paper develops, tentatively and for discussion, a set of candidate goals, indicators and targets for the acceleration of poverty reduction through social protection. The authors ask what it would take for social protection programs to contribute to halving the poverty gap in a country. They show that if all countries could achieve the actual poverty reduction efficiency already observed in the top quartile of countries, then 70 percent of the countries in the sample could achieve this goal. However, for 30 percent of the countries, even reaching the top quartile on efficiency will not be enough -- for these countries, the issue is one of budgetary adequacy.
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Policy Research Working Paper WPS6469 MAY 01, 2013
The paper contains a framework for linking social protection with growth and productivity, an updated review of the literature, new original work filling in gaps in the available evidence, and a discussion of operational implications.
... See More + The paper demonstrates that there was a shift in the economists' view on social protection, and now they are seen as a force that can make a positive contribution towards economic growth and reduce poverty. The paper looks at pathways in which social protection programs (social insurance and social assistance programs, as well as labor programs) can support better growth outcomes: (i) individual level (building and protecting human capital, and other productive assets, empowering poor individuals to invest or to adopt higher return strategies), (ii) local economy effects (enhancing community assets and infrastructure, positive spillovers from beneficiaries to non-beneficiaries), (iii) overall economy level (acting as stabilizers of aggregate demand, improving social cohesion and making growth?enhancing reforms more politically feasible). Most social protection programs affect growth through all of these pathways. But the evidence is very uneven; and there are knowledge gaps. The paper discusses operational implications for the design and implementation of Social Protection (SP) programs and proposes a work program for addressing knowledge gaps.
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Working Paper (Numbered Series) 67609 MAR 01, 2012
This paper presents a detailed picture of how sustained growth in Egypt over 2005-2008 affected different groups both above and below the poverty line.
... See More + This analysis, based on the Household Income, Expenditure and Consumption Panel Survey conducted by Egypts national statistical agency, compares the changes in the static poverty profiles (based on growth incidence curves on a cross-section of data) with poverty dynamics (relying on panel data, growth incidence curves and transition matrices). The two approaches yield contrasting results: the longitudinal analysis reveals that growth benefited the poor while the cross-sectional analysis shows that the rich benefitted even more. The paper also shows the importance of going beyond averages to look at the trajectories of individual households. Panel data analysis shows that the welfare of the average poor household increased by almost 10 percent per year between 2005 and 2008, enough to move out of poverty. Conversely however, many initially non-poor households were exposed to poverty. As a matter of fact, only 45 percent of the population in Egypt remained consistently out of (near-) poverty throughout the period, while the remaining 55 percent of Egyptians experienced at least one (near-) poverty episode. This high mobility is not a statistical artefact: it reflects the actual process of growth. Taking high vulnerability into account is essential when designing policies to protect the poor and to ensure that growth is really inclusive.
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Policy Research Working Paper WPS5589 MAR 01, 2011
This paper takes stock of labor market developments in Bosnia and Herzegovina over the period 2001-2004, using the panel Living Standards Measurement Study/Living in Bosnia and Herzegovina survey.
... See More + The analysis estimates a multinomial logit model of labor market transitions by state of origin (employment, unemployment, and inactivity) following the specification of widely used models of transition probabilities, and analyzes the impact of standard covariates. The results provide strong evidence that there are indeed significant differences in labor market transitions by gender, age, education, and geographic location. Using the panel structure of the multi-topic survey data, the authors find that these transitions are related to welfare dynamics, with welfare levels evolving differently for various groups depending on their labor market trajectories. The findings show that current labor market trends reflecting women's movement out of labor markets and laid-off male workers accepting informal sector jobs characterized by low productivity will lead to adverse social outcomes. These outcomes could be averted if the planned enterprise reform program creates a more favorable business environment and leads to faster restructuring and growth of firms.
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Policy Research Working Paper WPS4479 JAN 01, 2008
This paper decomposes changes in inequality, which has in general been increasing in the transition economies of Eastern Europe and the former Soviet Union, both by income source and socio-economic group, with a view to understanding the determinants of inequality and assessing how it might evolve in the future.
... See More + The empirical analysis relies on a set of inequality statistics that, unlike "official data", are consistent and comparable across countries and are based on primary records from household surveys recently put together for the World Bank study "Growth, Poverty and Inequality in Eastern Europe and the Former Soviet Union: 1998-2003" [World Bank (2005b)]. The increase in inequality in transition, as predicted by a number of theoretical models, in practice differed substantially across countries, with the size and speed of its evolution depending on the relative importance of its key determinants, viz., changes in the wage distribution, employment, entrepreneurial incomes and social safety nets. Its evolution was also influenced by policy. This diversity of outcomes is exemplified on the one hand for Central Europe by Poland, where the increase in inequality has been steady but gradual and reflects, inter alia, larger changes in employment and compensating adjustments in social safety nets and, on the other for the Commonwealth of Independent States by Russia, where an explosive overshooting of inequality peaked in the mid-1990s before being moderated through the extinguishing of wage arrears during its post-1998 recovery. The paper argues that the process of transition to a market economy is not complete and that further evolution of inequality will depend both on (i) transition-related factors, such as the evolution of the education premium, a bias in the investment climate against new private sector firms which are important vehicles of job creation and regional impediments to mobility of goods and labor, as well as increasingly (ii) other factors, such as technological change and globalization. The paper also contrasts key features of inequality in Russia in the context of other transition economies with trends in inequality observed in China where rapid economic growth has been accompanied by a steep increase in inequality. It argues that the latter's experience is, to a large extent, a developmental, rather than a transition-related phenomenon deriving from the rural-urban divide and is, therefore, of limited relevance for predicting changes in inequality in Russia.
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Policy Research Working Paper WPS4007 SEP 01, 2006
Following the 1998 financial crisis, four out of every ten people slipped into poverty, not able to meet basic needs. Luckily, post-crisis economic rebound was impressive and broad-based, albeit uneven across sectors and regions.
... See More + This title explores the nature of poverty, both nationally and regionally, to identify the groups with a high poverty risk. It then examines growth-poverty linkages through the labor market, as well as the contribution of growth and inequality to the recent poverty reduction. It also considers the expected impact of WTO accession on overall growth and poverty. Finally, it focuses on the scope for improving social policy in ways that will have a direct impact on the poor.
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2006 ABCDE Conference: focus on 15 years of changes by Boris Pleskovic. Poverty and inequality : inequality and growth in transition -- does China's rising inequality portend Russia's future?
... See More + by Pradeep Mitra and Ruslan Yemtsov. Trade liberalization, inequality and poverty reduction in Latin America by Guillermo Perry and Marcelo Olarreaga. Patterns of regional inequality in India and China by Kiran Gajwani, Ravi Kanbur, and Xiaobo Zhang. Institutions in transition : corporate governance and bankruptcy in emerging market economies by Erik Berglof, Patrick Bolton, Sergei Guriev, and Ekaterina Zhuravskaya. The Institutional determinants of effective policies in Latin America by Ernesto Stein and Mariano Tommasi. Three dilemmas for judicial reformers by Matthew Stephenson. Transforming judicial systems in Europe and Central Asia by James Anderson and Cheryl Gray. Privatization revisited : privatization -- lessons from a quarter of a century by Sergei Guriev and William Megginson. Objections to voucher privatization: not so valid? By Marek Louzek. Transition experiences : dynamics of institutions, development and elites by Francois Bourguignon. Joined at the hip: economics and politics in Russia's transition by Yegor Gaidar. The Eurasian growth paradox by Anders Aslund and Nazgul Jenish. Lessons from the Slavic tiger by Yudit Kiss. World Bank\IMF agenda. New books and working papers. Conference diary.
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2006 ABCDE Conference: focus on 15 years of changes by Boris Pleskovic. Poverty and inequality : inequality and growth in transition -- does China's rising inequality portend Russia's future?
... See More + by Pradeep Mitra and Ruslan Yemtsov. Trade liberalization, inequality and poverty reduction in Latin America by Guillermo Perry and Marcelo Olarreaga. Patterns of regional inequality in India and China by Kiran Gajwani, Ravi Kanbur, and Xiaobo Zhang. Institutions in transition : corporate governance and bankruptcy in emerging market economies by Erik Berglof, Patrick Bolton, Sergei Guriev, and Ekaterina Zhuravskaya. The Institutional determinants of effective policies in Latin America by Ernesto Stein and Mariano Tommasi. Three dilemmas for judicial reformers by Matthew Stephenson. Transforming judicial systems in Europe and Central Asia by James Anderson and Cheryl Gray. Privatization revisited : privatization -- lessons from a quarter of a century by Sergei Guriev and William Megginson. Objections to voucher privatization: not so valid? By Marek Louzek. Transition experiences : dynamics of institutions, development and elites by Francois Bourguignon. Joined at the hip: economics and politics in Russia's transition by Yegor Gaidar. The Eurasian growth paradox by Anders Aslund and Nazgul Jenish. Lessons from the Slavic tiger by Yudit Kiss. World Bank\IMF agenda. New books and working papers. Conference diary.
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This article proposes a research strategy to deal with the scarcity of data on beneficiaries for conducting impact assessments of community-level projects.
... See More + Community-level panel data from a regular household survey augmented with a special community module are used to measure the impact of projects. Propensity score-matched difference in-difference comparisons are used to control for time-invariant unobservable factors. This methodology takes into consideration the purposeful placement of projects and their interactions at the community level. This empirical approach is applied to infrastructure rehabilitation projects, for schools, roads, and water supply systems, in rural Georgia between 1998 and 2001. The analysis produces plausible results regarding the size of welfare gains from a particular project at the village level and allows for differentiation of benefits between the poor and the non-poor. The findings of this study can contribute to evaluations of the impact of infrastructure interventions on poverty by bringing new empirical evidence to bear on the welfare and equity implications.
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Contents: Russian entrepreneurs: tell me who your friends and family are...; by Simeon Djankov, Gerard Roland, Edward Miguel, Yingui Qian, and Ekaterina Zhuravskaya.
... See More + Entrepreneurs in Latvia: a few pieces of the puzzle; by Vyacheslav Dombrovsky. Barriers to entrepreneurship; by Leora Klapper, Luc Laeven, and Raghuram Rajan. Business owners' growth expectations in Lithuania; by Ruta Aidis and Tomasz Mickiewicz. Banking deregulation promotes creative destruction; by Marianne Bertrand, Antoinette Schoar, and David Thesmar. No exit? by William Tompson. Creative destruction in industrial and developing countries; by Eric Bartelsman, John Haltiwanger and Stefano Scarpetta. Lobbying on entry; by Enrico Perotti and Paolo Volpin. What makes small firms grow? Evidence from Romania; by David Brown, John Earle and Dana Lup. Financing conditions for small and medium enterprises in the new EU member states; by Ulrich Volz. Doing Business - 2005: Removing obstacles to growth; by Simeon Djankov. Russia's small business climate continues to improve; by Oleg Zamulin. Russian customs: a barrier to foreign trade, investments and entry? by Ksenia Yudaeva and Konstantin Kozlov. Representatives of SME organiazations in Lithuania, Romania, Slovakia and Russia talk about entrepreneurship. Who bears the cost of Russia's military draft? by Michael Lokshin and Ruslan Yemtsov. How transition paths differ: enterprise performance in Russia and China; by Sumon Bhaumik and Saul Estrin. India's reform attracts interest in Beijing; by Suman Bery. World Bank\IMF Agenda. New Books and Working Papers. Conference Diary. Bibliography of Selected Articles.
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Contents: Russian entrepreneurs: tell me who your friends and family are...; by Simeon Djankov, Gerard Roland, Edward Miguel, Yingui Qian, and Ekaterina Zhuravskaya.
... See More + Entrepreneurs in Latvia: a few pieces of the puzzle; by Vyacheslav Dombrovsky. Barriers to entrepreneurship; by Leora Klapper, Luc Laeven, and Raghuram Rajan. Business owners' growth expectations in Lithuania; by Ruta Aidis and Tomasz Mickiewicz. Banking deregulation promotes creative destruction; by Marianne Bertrand, Antoinette Schoar, and David Thesmar. No exit? by William Tompson. Creative destruction in industrial and developing countries; by Eric Bartelsman, John Haltiwanger and Stefano Scarpetta. Lobbying on entry; by Enrico Perotti and Paolo Volpin. What makes small firms grow? Evidence from Romania; by David Brown, John Earle and Dana Lup. Financing conditions for small and medium enterprises in the new EU member states; by Ulrich Volz. Doing Business - 2005: Removing obstacles to growth; by Simeon Djankov. Russia's small business climate continues to improve; by Oleg Zamulin. Russian customs: a barrier to foreign trade, investments and entry? by Ksenia Yudaeva and Konstantin Kozlov. Representatives of SME organiazations in Lithuania, Romania, Slovakia and Russia talk about entrepreneurship. Who bears the cost of Russia's military draft? by Michael Lokshin and Ruslan Yemtsov. How transition paths differ: enterprise performance in Russia and China; by Sumon Bhaumik and Saul Estrin. India's reform attracts interest in Beijing; by Suman Bery. World Bank\IMF Agenda. New Books and Working Papers. Conference Diary. Bibliography of Selected Articles.
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The authors use data from a large nationally representative survey in Russia to analyze the distributional and welfare implications of draft avoidance as a common response to Russia's highly unpopular conscription system.
... See More + They develop a simple theoretical model that describes household compliance decisions with respect to enlistment. The authors use several econometric techniques to estimate the effect of various household characteristics on the probability of serving in the army and the implications for household income. Their results indicate that the burden of conscription falls disproportionately on the poor. Poor, rural households, with a low level of education, are more likely to have sons who are enlisted than urban, wealthy, and better-educated families. The losses incurred by the poor are disproportionately large and exceed the statutory rates of personal income taxes.
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Policy Research Working Paper WPS3547 MAR 01, 2005
This study examines the impact of growth on poverty and inequality in Eastern Europe and the Former Soviet Union during 1998-2003. To measure poverty, an absolute poverty line of $2 a day is used, comparing it with household consumption per capita.
... See More + This line is a closer approximation to basic material needs in the Region than the well-known global standard of $1 a day because of the additional expenditures on heating and warm clothing that are required by the cold climate. In terms of poverty levels, the Region is best thought of in four distinct subgroups of countries. The eight new member states of the European Union (EU-8) have low poverty (less than 5 percent) confined to specific subgroups of the population. Countries in Southeastern Europe (SEE) have generally moderate levels of poverty (around 5-20 percent). The same is true of the middle-income countries in the Commonwealth of Independent States (CIS). The low-income countries in the CIS, however, have extremely high levels of poverty (more than 40 percent). In addition to countries in these four subgroups, The Europe and Central Asia Region of the World Bank (ECA) also includes Turkey. Wherever possible, we treat Turkey as a 'benchmark' against which to evaluate the performance of post socialist countries in the Region. Turkey has moderate poverty.
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