Category Archives: OPHI Working Papers

Does Aid Reduce Poverty?

Fifty years of literature on aid effectiveness has so far proven inconclusive. Two main challenges still require some attention. The first is to properly identify the causal effect of aid on poverty alleviation. To address it, I exploit differences in the number of years countries have been temporary members of the United Nations Security Council as an instrument for the average amount of economic aid disbursed by the United States. The second is to obtain reliable data on poverty, which I confront by using multidimensional poverty data from the Oxford Poverty and Human Development Initiative (OPHI). For a sample of 64 developing countries, I estimate a significant relationship between higher amounts of aid received during the period 1946–1999 and lower Multidimensional Poverty Index (MPI) between 2000 and 2014. On the contrary, the relationship does not seem to be significant when poverty is measured from an income perspective. Alternative measures of poverty could help improve the understanding of the relationship between development aid and poverty alleviation and might also contribute to improved targeting for aid disbursements.

Citation: Milovich, J. Y. (2018). ‘Does aid reduce poverty?’, OPHI Working Paper 122, University of Oxford.

Assessing Deprivation with Ordinal Variables: Depth Sensitivity and Poverty Aversion

The challenges associated with poverty measurement within an axiomatic framework, especially with cardinal variables, have received due attention during the last four decades. However, there is a dearth of literature studying how to meaningfully assess poverty with ordinal variables, capturing the depth of deprivations. In this paper, we first propose a class of additively decomposable ordinal poverty measures and provide an axiomatic characterisation using a set of basic foundational properties. Then, in a novel effort, we introduce a set of properties operationalising prioritarianism in the form of different degrees of poverty aversion in the ordinal context, and characterise relevant subclasses. We demonstrate the efficacy of our methods using an empirical illustration studying sanitation deprivation in Bangladesh. We further develop related stochastic dominance conditions for all our characterised classes and subclasses of measures. Finally, we elucidate how our ordinal measurement framework is related to the burgeoning literature on multidimensional poverty measurement.

Citation: Seth, S. and Yalonetzky, G. (2018). ‘Assessing deprivation with ordinal variables: depth sensitivity and poverty aversion’, OPHI Working Paper 123, University of Oxford.

The New Global MPI 2018: Aligning with the Sustainable Development Goals

Early in 2018, the United Nations Development Program’s Human Development Report Office (HDRO) and the Oxford Poverty and Human Development Initiative (OPHI) agreed to adjust and unify their methodologies on poverty measurement and consider indicator improvements, in order to better monitor the Sustainable Development Goals (SDGs).

This paper sets out the specifications of a joint global Multidimensional Poverty Index first published in 2018, which is an internationally comparable measure of acute poverty that captures the multiple deprivations poor people experience with respect to health, education and living standards.  It builds on the original MPI launched in 2010, and an innovative MPI launched in 2014. The best features of both of these are subsumed in the joint global MPI 2018, which also reflects new data possibilities to better align the global MPI to the Sustainable Development Goals.

Because the objective of revising the MPI to create a more credible and legitimate measure of multidimensional poverty that enables comparisons across countries using existing data was challenging to realize, the paper first sets out five key principles for a global poverty measure related to data coverage, communicability, comparability, disaggregation, and robustness.

Drawing on expert interventions, a global consultation, empirical trials, and these principles, the paper then explains conceptually the motivation and nature of adjustments that were made to five of the ten included indicators. It also recognizes desirable changes that could not be made due to data constraints – for example including data on the environment, work, and security, or on intrahousehold inequalities. And it identifies key issues for future research related to household composition and the use of land and livestock variables.

Citation: Alkire, S. and Jahan, S. (2018). The New Global MPI 2018: aligning with the Sustainable Development Goals’, OPHI Working Paper 121, University of Oxford.

Evaluating the Effects of Housing Interventions on Multidimensional Poverty: The Case of TECHO-Argentina

The objective of this paper is to evaluate the effect of the NGO TECHO’s emergency housing programme on multidimensional poverty. It employs a quasi-experimental ‘pipeline’ evaluation design and is based on household survey data from 34 informal settlements in Buenos Aires, Argentina. The aim is to demonstrate the additional insights that can be gained from using a multidimensional framework based on the Alkire and Foster (2011) method to evaluate a programme’s impact. The results indicate that the programme reduces both the incidence and the intensity of poverty and causes the multidimensional poverty measure to fall by more than half. The magnitude of the effect is greater for the households that initially were the poorest. Privacy, interpersonal relations and psychological health are the dimensions that contribute the most to explaining the decline in multidimensional deprivation.

Citation: Mitchell, A. and Macció, J. (2018). ‘Evaluating the effects of housing interventions on multi­dimensional poverty: the case of TECHO-Argentina’, OPHI Working Paper 120, University of Oxford.

The Research Agenda on Multidimensional Poverty Measurement: Important and As-yet Unanswered Questions

The application of multidimensional poverty measures is proliferating, in part due to the emphasis in Goal 1 of the Sustainable Development Goals (SDGs) on ending poverty in all its forms and dimensions.  This paper first traces the emergence of a priority for non-monetary poverty measures in key texts that consid­ered then set out the SDGs. It then outlines some vital and feasible research questions on a sub-set of fascinating empirical topics on counting-based multidimensional measures. The topics covered here relate to the SDGs’ focus on measuring the multidimensional poverty of men, women, and children. Building on the existing literature, fascinating questions remain in terms of measurement design (the selection of dimensions, indicators, cutoffs, and weights), the analysis of multidimensional poverty measures, their application to child poverty and their implementation using gendered data. In each of these areas, it is expected that significant breakthroughs are possible.

Citation: Alkire, S. (2018). ‘The research agenda on multidimensional poverty measurement: important and as-yet unanswered questions’, OPHI Working Paper 119, University of Oxford.

Multidimensional Poverty Measures as Relevant Policy Tools

Poverty measurement is strewn with imperfection. And yet, even understanding limitations such as data quality and coverage, measures of multidimensional poverty have proven to be relevant policy tools. This paper first situates muldimensional poverty measures in the Sustainable Development Goals, which seek to End Poverty in all its forms and dimensions (italics added). It then explains a key distinguishing feature between multidimensional and monetary poverty measures, namely, that multidimensional poverty measures have an associated ‘information platform’ which provides the deprivations in each indicator, as well as the headcount ratio or poverty rate, and the intensity of poverty overall, and does so both nationally and for all groups by which the dataset can be disaggregated. Furthermore, multiple poverty lines are often set and reported. Bearing this informational richness in mind, the paper then canvasses the main ways that policy actors are using multidimensional poverty indices (MPIs) and their associated informational platform to shape policy. For example, a permanent official MPI complements the national monetary poverty measure, often drawing attention to different groups of poor persons. Also, the MPI design often includes participatory exercises and expert consultations, thus catalysing a national conversation about what is poverty. Like any national statistic, the MPI is used to monitor change and show the trend in a phenomenon of public importance. Further, the MPI, with its disaggregation by group and breakdown by indicator, is often used as part of the budget allocation formulae, for example, across subnational regions. The MPI is also used for targeting in two senses: targeting the poorest areas or social groups, and also (using a different dataset), targeting households that are eligible to benefit from certain schemes. One of the most powerful roles of the MPI is to support policy coordination which – in line with the SDG emphasis – facilitates integrated multisectoral policies that can be more cost-effective and high-impact methods for addressing interconnected deprivations and managing change. Finally, for many countries, the MPI is part of a new emphasis on the transparency and accountability of statistics, for example by posting data tables, or even datasets and computer algorithms online so students and researchers can fruitfully join the intellectual task of finding better ways to confront human disadvantage and suffering. The paper closes by referring to some new research areas that might further enrich this unfolding discipline.

Citation: Alkire, S. (2018). ‘Multidimensional poverty measures as relevant policy tools’, OPHI Working Paper 118, University of Oxford.

Walls of Glass: Measuring Deprivation in Social Participation

This paper proposes a measure for deprivation in social participation, an important but so far neglected dimension of human well-being. Operationalisation and empirical implementation of the measure are conceptually guided by the capability approach. Essentially, the paper argues that deprivation in social participation can often be convincingly established by drawing on extensive non-participation in customary social activities. In doing so, the present paper synthesizes philosophical considerations, axiomatic research on poverty and deprivation, and previous empirical research on social exclusion and subjective well-being. An application using high-quality survey data for Germany supports the measure’s validity. Specifically, the results suggest, as theoretically expected, that the proposed measure is systematically different from related concepts like material deprivation and income poverty. Moreover, regression techniques reveal deprivation in social participation to reduce life satisfaction substantially, quantitatively similar to unemployment. Finally, questions like preference vs. deprivation, cross-country comparisons, and the measure’s suitability as a social indicator are discussed.

Citation: Suppa, N. (2018): ‘Walls of Glass: Measuring Deprivation in Social Participation’ OPHI Working Paper 117, University of Oxford.

Measuring Sanitation Poverty: A Multidimensional Measure to Assess Delivery of Sanitation and Hygiene Services at the Household Level

Water, sanitation and hygiene (WaSH) are at the core of sustainable development. As we embark on a new round of global goals, namely the Sustainable Development Goals, a top priority is to address a coherent framework for monitoring these services. In the coming years, the sector will witness the development of a variety of multidimensional monitoring measures, albeit from different perspectives. This paper reviews the relevant literature and discusses the adequacy and applicability of one approach that is increasingly adopted for multidimensional poverty measurement at the household level, the Alkire-Foster methodol­ogy. Drawing on this method, we identify and combine a set of direct household-related water and sanitation deprivations that batter a person at the same time. This new multidimensional measure is useful for gaining a better understanding of the context in which WaSH services are delivered. It captures both the incidence and intensity of WaSH poverty, and provides a new tool to support monitoring and reporting. For illustrative purposes, one small town in Mozambique is selected as the initial case study.

Citation: Giné-Garriga, R. and Pérez-Foguet, A. (2018). ‘Measuring sanitation poverty: a multidimen­sional measure to assess delivery of sanitation and hygiene services at the household level’. OPHI Working Paper 116, University of Oxford.

The Measurement Properties of Multidimensional Poverty Indices for Children: Lessons and Ways Forward

This paper considers the measurement properties of indices used to measure multidimensional child poverty in the developing world. Two indices are considered in detail: the Alkire Foster method (Alkire & Foster 2010) and the ‘categorical counting’ method as exemplified by UNICEF poverty indices based on methodologies by Gordon et al. (2003) and De Neubourg et al. (2013). This analysis examines the underlying differences between the two methodologies in two stages. First, using hypothetical data we consider the differences in measurement properties that arise from the axiomatic construction of indices using a laboratory approach. Second, we use harmonized Demographic and Health Surveys data from three countries to examine how the properties found in the laboratory data lead to actual differences in the measurement of the prevalence of multidimensional poverty within and across countries, and the ability of indices to monitor changes in the prevalence of multidimensional poverty. The paper concludes by considering the findings from the analysis and how they could be taken forward in future measurements of poverty prevalence and reduction in Sustainable Development Goals targets and indicators.

Citation: Evans, M.C. and Abdurazakov, A. (2018). ‘The measurement properties of multidimensional poverty indices for children: lessons and ways forward’. OPHI Working Paper 115, University of Oxford.

Multidimensional Inequality and Human Development

The measurement of inequality from a human development perspective is fundamental. We start this paper by briefly introducing the human development approach and its main conceptual basis: the capability approach. We note that inequality should preferably be assessed in the space of functionings, requiring the assessment methods to use multidimensional techniques. We then present the primary challenges inherent to multidimensional inequality measurement that are related to two types of distributional changes: one is concerned with the dispersions within distributions that are analogous to the unidimensional framework and the other, unlike the unidimensional framework, is concerned with the association between distributions. We next present a succinct review of the most prominent measures proposed in the literature within a unifying framework and review the empirical applications surrounding these measures. We note that while multidimensional inequality measures have a great potential to contribute to the monitoring of human development, there are some challenges to overcome in order to fulfil this potential.

Citation: Seth, S. and Santos, M. E. (2018). ‘Multidimensional inequality and human development’. OPHI Working Paper 114, University of Oxford.