Category Archives: OPHI Working Papers

Multidimensional Poverty and Inclusive Growth in India: An Analysis Using Growth Elasticities and Semi-Elasticities

Post reform India has generated high economic growth, yet progress in income poverty and many other key development outcomes has been modest. This paper primarily examines how inclusive economic growth has been in India between 2005-06 and 2015-16 in reducing multidimensional poverty captured by the global Multidimensional Poverty Index (MPI). We employ a constellation of elasticity and semi-elasticity measures to examine vertical, horizontal as well as dimensional inclusiveness of economic growth. Nationally, we estimate that a one percent annual economic growth in India during our study period is associated with an annual reduction in MPI of 1.34 percent. The association of the national growth to state poverty reduction (horizontal inclusiveness) is however not uniform. Some states have been successful in reducing poverty faster than the national average despite slower economic growth between 2005-05 and 2015-16; whereas, other states have been less successful to do so despite faster economic growth during the same period. Our analyses and findings show how these tools may be used in practical applications to measure inclusive growth and inform policy.

This paper is forthcoming in the Research on Economic Inequality, vol. 29.
Download the preprint of ‘Multidimensional poverty and inclusive growth in India: An analysis using growth elasticities and semi-elasticities’

Citation: Seth, S. and Alkire, S. (2021). ‘Multidimensional poverty and inclusive growth in India: An analysis using growth elasticities and semi-elasticities’, OPHI Working Papers 137, Oxford Poverty and Human Development Initiative (OPHI), University of Oxford.

Leaving No Country Behind in Human Development: A Fuzzy Approach

‘Leaving no one behind’ (LNOB) constitutes one of the core principles underpinning the 2030 Agenda for Sustainable Development. In this paper, we propose a fuzzy logic approach to identify countries left behind in each dimension of human development and to estimate the extent to which certain countries are left behind in terms of overall human development. Following the current analytical framework for measuring the Human Development Index (HDI), we illustrate our proposal by measuring the degree to which a country was left behind in the years 2000 and 2018. In general, we find that the countries left furthest behind at the beginning of the century were those that most reduced gaps with respect to better performing countries. Nevertheless, we cannot clearly speak of convergence in HDI as there are notable exceptions, such as the Central African Republic, Liberia, Yemen, Haiti, and Venezuela, which despite the improvement in their HDI between 2000 and 2018, worryingly increased their gaps in human development relative to the rest of the world. The illustration highlights the significant advantages of measuring cross-county human development using our fuzzy-based LNOB approach to provide new complementary measures consistent with the United Nations’ moral imperative of leaving no country behind.

Citation: García-Pardo, F., Pérez-Moreno, S.  and Bárcena-Martín, E. (2021). ‘Leaving no country behind in human development: A fuzzy approach’, OPHI Working Paper 136, Oxford Poverty and Human Development Initiative (OPHI), University of Oxford.

Endogenous Weights and Multidimensional Poverty: A Cautionary Tale

Composite measures such as multidimensional poverty indices depend crucially on the weights assigned to the different dimensions and their indicators. A recent strand of the literature uses endogenous weights, determined by the data at hand, to compute poverty scores. Notwithstanding their merits, we demonstrate both analytically and empirically how a broad class of endogenous weights violates key properties of multidimensional poverty indices such as monotonicity and subgroup consistency. Without these properties, anti-poverty policy targeting and assessments are bound to be seriously compromised. Using real-life data from Ecuador and Uganda, we show that these violations are widespread. Hence, one should be extremely careful when using endogenous weights in measuring poverty. Our results naturally extend to other welfare measures based on binary indicators, such as the widely studied asset indices.

Citation: Dutta, I., Nogales, R. and Yalonetzky, G. (2021): ‘Endogenous weights and multidimensional poverty: A cautionary tale’, OPHI Working Paper 135, Oxford Poverty and Human Development Initiative (OPHI), University of Oxford.

An advanced version of this paper is published in the Journal of Development Economics; available online from 17 February 2021.

Income Mobility in a Changing Macroeconomic Environment

The analysis of income mobility is often constrained to short-term periods of survey panel data. This paper provides long-term income mobility trends through a continuum of short- term synthetic panels in Mexico. The examined period of analysis (1989–2018) is characterized by the lack of panel data and by a changing macroeconomic environment. The analysis builds on cross-sectional survey data using the methodology developed in Bourguignon and Moreno (2020) and employs several income mobility indicators from three complementary conceptions used in the literature: positional mobility, directional movement, and mobility as an equalizer of longer-term incomes. This research documents low levels of economic mobility over the course of three decades, except for the periods of rebound economic growth following the two deepest economic crises in modern times: one internal, in 1995, and one external – in 2009. These movements, however, seem to be only transitory deviations as income mobility indicators soon returned to their characteristic levels.

Citation: Moreno, H. (2020): ‘Income mobility in a changing macroeconomic environment’, OPHI Working Paper 134, Oxford Poverty and Human Development Initiative, University of Oxford.

Monetary and Multidimensional Poverty: Correlations, Mismatches and Joint Distributions

We consider the relationships between multidimensional and monetary poverty indices in international and national poverty profiles, and evaluate the empirical consequences of identifying poor people relying on a combination of both approaches. Taking first a cross-country perspective, focusing on the developing world, we find that the incidence of poverty accord- ing to money metrics and the global MPI, a non-monetary measure of poverty, are correlated. This correlation breaks down in poorer countries. We use micro-data from six countries to study the joint densities of monetary and multidimensional welfare and the poverty identification mismatches for a comprehensive array of poverty line pairs. Mismatches are important, particularly, again, in the poorer countries. Although mismatches could be solved by combining both approaches in a dual cutoff poverty measure, the choice of the monetary poverty line remains a considerable issue as it changes the non-monetary composition of poverty.

Citation: Evans, M. Nogales, R. and Robson, M. (2020). ‘Monetary and multidimensional poverty: Correlations, mismatches, and joint distributions’, OPHI Working Paper 133, University of Oxford.

Evaluation of Anti-poverty Programs’ Impact on Joint Disadvantages: Insights from the Philippine Experience

Anti-poverty programs increasingly target disadvantages in multiple outcomes to address cur- rent and future poverty. Conventional evaluation exercises, however, mostly estimate pro- grams’ impacts separately. We present a framework, drawing from the counting approach, that captures the joint distribution of disadvantages and allows the evaluation of programs’ impacts on multiple disadvantages. We apply the framework to scrutinise the Philippine conditional cash transfer program using an embedded randomised control trial survey. Examining the program’s impact on the distribution of multiple disadvantages, we observe that the program successfully reduced multiple disadvantages overall, but did not necessarily benefit the families experiencing a higher number of disadvantages simultaneously. Our results exemplify the valuable contribution of considering the joint distribution of disadvantages in evaluating anti-poverty programs’ impacts.

Citation: Seth, S. and Tutor, M. J. (2019): ‘Evaluation of anti-poverty programs’ impact on joint disadvantages: Insights from the Philippine experience’ OPHI Working Paper 132, University of Oxford.

Work and Wellbeing: A Conceptual Proposal

Labour is of utmost importance for human wellbeing. Yet a comprehensive framework that can reflect the empirical diversity of labour activities along with each activities’ manifold effects on human wellbeing is still lacking. An additional challenge for any such framework is to adequately handle fundamental moral ambiguities, which are inherent to many forms of work. This paper argues that a conceptualisation of labour within the capability approach can meet these requirements. Specifically, I argue that labour can be conceived as a characteristic-providing activity, where obtained characteristics are then transformed into functioning achievements, while accounting for both individual and societal heterogeneity. Additionally, paying adequate attention to unfreedoms experienced by agents turns out to be vital for a comprehensive account. Finally, the paper discusses policy handles, offers suggestions for particular applications, and identifies several other benefits for labour economics.

Citation: Suppa, N. (2019). ‘Work and wellbeing: A conceptual proposal.’ OPHI Working Paper 131, University of Oxford.

Impact of the SADA-Northern Ghana Millennium Village Project on Multidimensional Poverty: A Comparison of Dashboard and Index Approaches

This paper assesses the impact of the SADA-Northern Ghana Millennium Village Project (MVP) on multidimensional poverty using dashboard and index approaches. Using a unique, large dataset that spans five years and contains data on multiple welfare indicators, we estimate the impact of MVP on the Millennium Development Goals (MDGs) and on the global multidimensional poverty index (global MPI). We find that the project had a limited impact on the MDGs and yet a positive impact on the global MPI. We assess the robustness of the impact of MVP on the global MPI, and we conclude that it was largely driven by the sensitivity of the index to changes in a few MDG indicators. We conclude that the MVP had a limited impact on welfare and that the global MPI should be used with caution in the evaluation of development programmes.

Citation: Masset, E. and García Hombrados, J. (2019): ‘Impact of the SADA-Northern Ghana Millennium Village Project on multidimensional poverty: A comparison of dash-board and index approaches’. OPHI Working Paper 130, University of Oxford.

The Welfare Effects of India’s Rural Employment Guarantee

We examine the welfare effects of India’s workfare program NREGA using a novel, almost sharp regression discontinuity design. We find large seasonal consumption increases in states implementing the program intensely, which are a multiple of the direct income gains. We also find increases in adolescents’ school attendance. Our results imply substantial general equilibrium effects. We conclude that, when properly implemented, the public employment program holds significant potential for reducing poverty and insuring households against various adverse implications of seasonal income shortfalls.

Citation: Klonner, S. and Oldiges, C. (2019). ‘The welfare effects of India’s Rural Employment Guarantee’, OPHI Working Paper 129, University of Oxford.

Diverging Identification of the Poor: A Non-random Process. Chile 1992–2017

This paper investigates the degree of association in the identification of the poor between the standard monetary FGT measure and the Alkire-Foster Multidimensional Poverty Index. For this purpose, we use a measure of redundancy between the two poverty measures (R0). In Chile, over the past 25 years, R0 has declined at a rate of 1.5% per year. The decline is unimportant during the 1990s, a decade of rapid economic growth, while it is notable thereafter, in a period characterized by modest economic growth and the progressive introduction and deepening of social policies. The conditional correlation between socioeco­nomic and demographic characteristics with R0 is examined at the province and household levels. After controlling for household non-eligibility across some of the indicators of the Multidimensional Poverty Index, we find that the divergence in the identification of the poor can be explained by improve­ments in education, increasing urbanization, and a reduction in the household size. Consequently, the divergent identification of the poor seems to be a real process, which is not randomly distributed across the population. On the basis of our results, we hypothesize that this divergence is a general phenomenon that tends to occur in countries undergoing demographic transition, urbanization, and progress in educa­tion. If so, and given the fact that poverty alleviation strategies are adopted partly on the basis of poverty statistics, the diverging identification of the poor might have distributive consequences for the poor themselves.

Citation: Klasen, S. and Villalobos, C. (2019). ‘Diverging identification of the poor: A non-random process. Chile 1992–2017’, OPHI Working Paper 128, University of Oxford.