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Poverty

Demystifying Economic Inequality in Nepal

SaileshTiwari's picture
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“I didn’t go to school and I don’t have the money to run a bigger business. So I do what I know. Hardship is our way of life.” - Sangmu Bhote Gangdokpa, Sankhuwasabha (Photo Credit – Stories of Nepal)

In 2003, Meiko Nishimizu, the World Bank Vice President for South Asia at the time, referred to Kathmandu as “an island of prosperity in a sea of poverty that is Nepal”.  This was a time when the country was besieged with a violent conflict, with the state struggling to keep control of urban areas while rebels and security forces locked horns in the countryside. Her invocation of Martin Luther King Jr’s quote that “injustice anywhere is a threat to justice everywhere” must have resonated deeply with those in Kathmandu, especially those that may have associated inequality with the rise of the conflict.

Thirteen years on, as we think about Nepal’s progress on poverty reduction since then, it is appropriate to reflect on inequality and how it has evolved during this period. Has every Nepali benefitted from the living standards improvements that have been realized in the country? Or have some been left behind?

Is predicted data a viable alternative to real data?

Roy Van der Weide's picture

The primary motivation for predicting data in economics, health sciences, and other disciplines has been to deal with various forms of missing data problems. However, one could also make a case for adopting prediction methods to obtain more cost-efficient estimates of welfare indicators when it is expensive to observe the outcome of interest (in comparison with its predictors). For example, consider the estimation of poverty and malnutrition rates. The conventional estimators in this case require household- and individual-level data on expenditures and health outcomes. Collecting this data is generally costly. It is not uncommon that in developing countries, where poverty and poor health outcomes are most pressing, statistical agencies do not have the budget that is needed to collect these data frequently. As a result, official estimates of poverty and malnutrition are often outdated: For example, across the 26 low-income countries in Sub-Saharan Africa over the period between 1993 and 2012, the national poverty rate and prevalence of stunting for children under five are on average reported only once every five years and once every ten years in the World Development Indicators.

People’s living standards – do numbers tell the whole story?

Giorgia DeMarchi's picture
Numbers don’t lie. That’s why, in our day-to-day lives, we rely heavily on numbers from household surveys, from national accounts, and from other traditional sources to describe the world around us: to calculate, to compare, to measure, to understand economic and social trends in the countries where we work.

But do we perhaps rely too much on numbers to gain an understanding of people’s lives and the societies in which they live? Do numbers really tell us the whole story, or give us the full picture?


 

Measuring inequality isn’t easy or straightforward - Here’s why

Christoph Lakner's picture

This is the third of three blog posts on recent trends in national inequality.

In earlier blogposts on recent trends in inequality, we had referred to measurement issues that make this exercise challenging. In this blogpost we discuss two such issues: the underlying welfare measure (income or consumption) used to quantify the extent of inequality within a country, and the fact that estimates of inequality based on data from household surveys are likely to underreport incomes of the richest households. There are a number of other measurement challenges, such as those related to survey comparability, which are discussed in Poverty and Shared Prosperity 2016 – for a focus on Africa, also see Poverty in a Rising Africa, published earlier in 2016.

Against all odds - What is driving poverty reduction in Nepal?

SaileshTiwari's picture
Father and son
“Today is the happiest day in my life. I never thought my son would be going to a boarding school in the city.” - Tsering Tejaba, Sankhuwasabha (Photo Credit – Stories of Nepal)


The year 2015 was rough on Nepal. The catastrophic earthquakes that struck the country in April/May caused widespread destruction of life and property and was followed by disruptions in the south that brought cross-border trade with India to a complete standstill for 4 months. As dramatic as these recent shocks have been, Nepal is no stranger to conflict and fragility. A 10-year violent Maoist conflict ended in 2006 but the ensuing years of drafting a new constitution were turbulent; politics often dominating the discourse as opposed to economics. But despite these unfavorable odds, Nepal made rather surprising progress on improving living standards and reducing poverty.

Between 1995 and 2010, absolute poverty – measured as the proportion of people living below the national poverty line of Rs.19,261 per person per year – declined steadily by around 2.2 percentage points a year. This helped the country meet the MDG target of halving income poverty by 2015 quite comfortably. Living standards improvements were realized not just based on income or consumption but also along multidimensional measures of well-being that take into account access to essential services such as education, health and drinking water and sanitation. What was behind this progress on poverty reduction Nepal achieved amidst a violent conflict and a tumultuous post-conflict recovery?

Blog post of the month: A sidekick for development

Maya Brahmam's picture

Each month People, Spaces, Deliberation shares the blog post that generated the most interest and discussion.
For October 2016, the featured blog post is "A Sidekick for Development" by Maya Brahmam.

October 17 was End Poverty Day – and we at the World Bank in Washington had a small celebration and a lively discussion around the new Poverty report: Poverty and Shared Prosperity 2016: Taking on Inequality. Topics ranged from 2 billion people living in countries affected by conflict to the work on social inclusion – which included a two-part definition of social inclusion: “The process of improving the terms for individuals and groups to take part in society” and “The process of improving the ability, opportunity, and dignity of people, disadvantaged on the basis of their identity, to take part in society.”

Ahead of the next Habitat conference, the urban world we want

Sameh Wahba's picture


There is no better way to mark this year’s World Cities Day than reflecting on the adoption of the New Urban Agenda at the recent Habitat III conference in Quito. The agenda reaffirms the political commitment to sustainable urbanization and provides a framework to guide global urban development over the next 20 years, based on a shared vision of cities that are inclusive, safe, resilient and sustainable.

In an era of rapid urbanization and climate change, managing urban growth sustainably and building cities that work is indeed one of our most pressing development challenges.

Already, more than half of the global population — nearly 4 billion people — live in urban areas. Two decades from now, that number will grow to 5.5 billion — more than 60 percent of the world’s population. At the same time, the total built-up area of the world’s cities is expected to be double by 2030 what it is today, if not more.

Because urban-planning decisions lock cities in for generations, what policymakers decide in these two decades will make or break cities’ sustainable future for the rest of this century. With that in mind, one may ask: What will the world look like when Habitat IV takes place in 20 years?

I can imagine two opposite ends of the spectrum.

England’s warrior kings, extractive institutions, and tax policy

Theresa Osborne's picture

When the Plantagenet kings ruled England (1154-1485), their primary means of securing wealth, prestige, and power was through territorial conquest. Fighting endless wars in France and dispatching armies as far as Jerusalem, the crown often had to finance foreign adventures through taxation -- sometimes crushing taxation – of subjects.  The illegitimacy of such taxation only intensified the recurrent threat of domestic revolt.  And through their demands for more accountable and inclusive governance, the English nobility succeeded, albeit with much blood shed over a span of centuries, to establish institutions and public policies conducive to economic development.

Implementing the New Urban Agenda needs financially strong cities

Ede Ijjasz-Vasquez's picture
Cities around the world face increasingly complex challenges such as rapid urbanization and climate change. Meanwhile, many cities facing the most pressing problems lack sufficient funding to meet local needs. This is especially the case for developing countries, where cities require significant infrastructure investment to provide basic services to growing populations and expanding urban areas.
 
How can cities access, leverage, and manage the fiscal and financial resources required to implement the New Urban Agenda and meet the growing needs of local populations?
 
To explore this issue, World Bank Senior Director Ede Ijjasz-Vasquez discussed the UN Habitat III policy paper on municipal finance and local fiscal systems with Mac McCarthy, President and CEO of the Lincoln Institute of Land Policy.
 

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