1 54508 v1 Do Our Children Have A Chance? The 2010 Human Opportunity Report for Latin America and the Caribbean Conference Edition José R. Molinas, Ricardo Paes de Barros, Jaime Saavedra, Marcelo Giugale With Louise J. Cord, Carola Pessino, Amer Hasan 2 3 Do Our Children Have A Chance? The 2010 Human Opportunity Report for Latin America and the Caribbean Overview The findings were eye-opening: behind the enormous inequality that characterizes the region's distribution of development Imagine a country where your future did outcomes (income, land ownership and not depend on where you come from, educational attainment, among others), how much your family earns, what color there is an even more worrying inequality your skin is, or whether you are male or of development opportunities. It is not female. Imagine if personal circumstances, only rewards that are unequal; it is also those over which you have no control chances. The problem is not just about or responsibility, were irrelevant to your equality; it is about equity too. The playing opportunities, and to your children's field is uneven from the start. opportunities. And imagine now a statistical tool that can help governments This book reports on the status and make that a reality. Welcome to the Human evolution of human opportunity in LAC. It Opportunity Index (HOI). builds on the 2008 publication in several directions. First, it uses newly-available The HOI calculates how personal data to expand the set of opportunities and circumstances (like birthplace, wealth, race personal circumstances under analysis. The or gender) impact a child's probability of data is representative of some 200 million accessing the services that are necessary children living in 19 countries over the to succeed in life, like timely education, last 15 years. Second, it compares human running water or connection to electricity. opportunity in LAC with that of developed It was first published in 2008, applied to countries, among them the US and France, Latin America and the Caribbean (LAC). two very different models of social policy. This allows for illuminating exercises in are necessary to progress in life (say, benchmarking and extrapolation. And running water), discounted or "penalized" third, it looks at human opportunity within by how unfairly the services are distributed countries--across regions, states and cities. among the population. So, two countries This gives us a preliminary glimpse at the that have identical coverage may have a geographic dimension of equity, and at the different HOI if the citizens that lack the role that different federal structures play. service are all female, or black, or poor, or have many siblings or, more generally, The overall message that emerges is one of share a personal circumstance beyond cautious hope. LAC is making progress in their control. In other words, the HOI is opening the doors of development to all. coverage corrected for equity. In theory, But it still has a long way to go. At the you can increase it by changing people's current pace, it would take, on average, circumstances (the "composition effect"), a generation for the region to achieve providing more services to all ("scale universal access to just the basic services effect"), or distributing services more fairly that make for human opportunity. Seen ("equalization effect"). from the viewpoint of equity, even our most successful nations lag far behind The HOI runs from zero to 100; a society the developed world. And intra-county that has achieved universal coverage of regional disparities are large, and barely all services would score at 100. To make converging. Fortunately, there is much comparisons possible across countries and policy makers can do about it. across time, the HOI for LAC presented in this report uses only services and circumstances How Does the HOI Work? that are available in all household surveys. Specifically, it looks at access to water, electricity and sanitation, and to school In its simplest interpretation, the HOI attendance and timely completion of the measures the availability of services that sixth grade. A rich empirical literature 4 5 demonstrates that, without those basic insufficient. For example, at its current services, the chances of a productive life are speed, Central America would take 37 years close to nil. And it focuses on seven personal to achieve universality in basic education circumstances: parents' education, family and housing. income, number of siblings, the presence of both parents in the house, gender, gender of The good news is that all countries have household head, and location of residence. raised their HOI in the last decade and In all cases, the unit of focus is the child, a half, some quite rapidly (the fastest defined as an individual between the ages of improvement occurred in Mexico). zero and 16. This isolates away the problem Variations remain wide though, from top- of effort and choice--at that age, children performer Chile (HOI of 95) to Honduras can hardly be responsible for their fate. (51). Interestingly, the five countries with the highest HOI--Chile, Uruguay, Mexico, Of course, in country specific applications Costa Rica, and Venezuela --have very of the HOI, data availability may allow for different development models. more, or more sophisticated, services and circumstances, like preventive dental check- ups, internet access, ethnic identification, or father's occupation. Some of that will be shown here, when comparing LAC countries with their developed-world peers. Is Human Opportunity Expanding in LAC? Yes, but slowly and with marked differences across countries. Since 1995, the region's average HOI has grown at a rate of one percentage point per year. This is clearly 6 100 40 50 60 70 80 90 Chile Uruguay Mexico Costa Rica Venezuela, R.B de Jamaica Ecuador Source: World Bank 2010 Human Opportunity Report Colombia Brazil LAC Average Dominican Republic Figure 1. The 2010 Human Opportunity Index for LAC Paraguay Panama Peru The 2010 Human Opportunity Index for LAC Guatemala El Salvador Nicaragua Honduras 7 Some countries excel at certain services determine yours. And your birthplace and not at others. For example, Jamaica is still the most powerful predictor of has the highest educational HOI, but is whether you will have access to basic only mid-table in housing. Even within infrastructure. type of service, issues of quality arise: LAC children have more chances to be enrolled For all their efforts, LAC governments in school than to complete sixth grade on have, in general, not made much time. Attendance, it seems, is no synonym progress improving equity. Only a tenth for learning. of the average improvement in HOI is attributable to a fairer allocation of Sadly, personal circumstances still matter services, that is, to better social targeting a lot for Latin American children. Your of public expenditures. The bulk of the parents' level of education will very likely new opportunities opened to the region's children came from changing circumstances family is, the better your test results. (for instance, migration may have reduced the proportion of rural population). A similar exercise can be performed for housing conditions using census data. Again, LAC has work to do: the opportunity Latin America Versus Rich Countries of living in a house with sanitation facilities or free from overcrowding is highly Using standardized test results from the dependent on personal circumstances. OECD's Program for International Student In both conditions, only a handful of Assessment, and the related demographic countries in the region score above the data, it is possible to construct a HOI that European average. And again, this is due measures the educational opportunities less to larger coverage in Europe than to faced by 15 year-old children around the unfair provision in LAC. world. In other words, it is possible to measure how important are those children's Finally, international comparison allows us personal circumstances in determining their to peek at how human opportunity could proficiency in reading, mathematics or evolve in LAC over the long term. Using science. This sheds an uncomfortable light a half-century's worth of relevant data for on LAC. Even the countries with the highest the US and France, an HOI for housing score in the region, Chile and Uruguay, rank conditions can be built. It shows a clear well below the worst-performing countries pattern: rapid initial growth, followed in Europe and North America. Much of the by a marked slow-down, and virtually gap is not due to the fact that rich countries stalling right before the point of universal just provide more education services, but coverage. The lesson is clear: the better to the relatively unfair way in which those you do, the harder it is to make progress. services are distributed in LAC. If you are a Latin American student, the wealthier your 8 9 Country, State, City What Can Be Done? How is human opportunity distributed at LAC remains the most unequal region in the sub-national level? There is enough the world. The result has been acrimonious information to replicate the HOI for some political disagreement over the proper role 165 states and cities in LAC, over the past of the state: should it redistribute wealth 15 years. The results are telling. First, or protect private property? Where there dispersion is wide among sub-nationals, is no disagreement, however, is over the with Tierra del Fuego at one end (HOI of need to give all Latin Americans the same 96) and the Atlantic region of Nicaragua opportunities, as a matter of social justice at the other (29). Second, all capital cities or as a call to personal effort. While rank higher than the rest of their countries, equality is controversial, equity enjoys and that gap is wider the lower the level of support across the political spectrum. the national HOI. While not discussed in the report, the Third, convergence appears slow, but HOI makes it possible to redirect social lagging geographic areas do improve policy towards equity (where there is faster and catch up in providing more consensus) and away from equality opportunities to their local population--a (where there is not). How? Many existing mirror image of the observed evolution social policies and programs are already of human opportunity among countries. equity-enhancing. But focusing on equity Fourth, the bigger or the less decentralized reveals new points of emphasis along the a country is, the more dispersed its regions' individual's life-cycle. Early interventions, HOI appear. And fifth, decentralization from pregnancy monitoring and seems to have been more effective in institutional births to toddlers' nutrition diminishing regional inequity, but more so and neurological development, get a new in education than in housing. sense of priority. So do preschool access (such as pre-kindergarten social interaction) a way of giving out public assistance that and primary school achievement (such as was blind to the needs of the recipient--a reading standards and critical thinking). way that was intrinsically unfair. The physical security, reproductive education, mentoring, and talent screening At the same time, when applied within in adolescents, all areas that are often countries, the HOI is a powerful tool to overlooked, gain new relevance. A battery identify and address regional inequities. of legal and institutional pre-conditions Shouldn't a child-citizen have the same become sine qua non, from birth certificates, chances in life no matter where in the voter registration and property titles to national territory she is born? Several the enforcement of anti-discrimination, LAC governments have in recent years antitrust, and access-to-information laws. implemented mechanisms to equalize And blanket subsidies that, at the margin, service provision across sub-national are consumed by those who do not need jurisdictions. Most of those mechanisms them (free public college education for the are based on regional factors such as rich, to name one), turn into opportunity- poverty levels, efforts at self-taxation, wasting aberrations. If anything else, the and ownership of natural resources. The quest for equity will lead to a final push question now is whether equal opportunity in the decade-long process of targeting among children should not be taken into subsidies, and will spell the end-game for account too. 10 11 1818 H Street, NW, Washington, DC 20433, USA Telephone: + 1 202 473 1000 www.worldbank.org/lacopportunity All right reserved 12