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Poverty

Revolutionizing Data Collection: From “Big Data” to “All Data”

Nobuo Yoshida's picture

The limited availability of data on poverty and inequality poses major challenges to the monitoring of the World Bank Group’s twin goals – ending extreme poverty and boosting shared prosperity. According to a recently completed study, for nearly one hundred countries at most two poverty estimates are available over the past decade.Worse still, for around half of them there was either one or no poverty estimate available.* Increasing the frequency of data on poverty is critical to effectively monitoring the Bank’s twin goals.
 
Against this background, the science of “Big Data” is often looked to as providing a potential solution. A famous example of this science is “Google Flu Trends (GFT)”, which uses search outcomes of Google to predict flu outbreaks. This technology has proven extremely quick to produce predictions and is also very cost-effective. The rapidly increasing volumes of raw data and the accompanying  improvement of computer science have enabled us to fill other kinds of data gaps in ways that we could not even have dreamt of  in the past.

Does Culture Matter for Development?

Augusto Lopez-Claros's picture

For a variety of reasons, economists have avoided getting too closely involved with the concept of culture and its relationship to economic development. There is a general acceptance that culture must have a role in guiding a population along a particular path, but, as Landes (1998) points out, a discomfort with what can be construed as implied criticism of a particular culture has discouraged broader public discourse.
 
As we discuss in a recent paper, the role of culture in economic development is not an easy subject to get a handle on. To start with, one faces issues of definition. The more all-encompassing the definition, the less helpful it tends to be in explaining patterns of development. Economists tend to narrowly define culture as “customary beliefs and values that ethnic, religious, and social groups transmit fairly unchanged from generation to generation” (Guiso, Sapienza and Zingales, 2006). This approach is largely dictated by the aim to identify causal relationships, by focusing on aspects of culture that are constant over time. Not surprisingly, some of the most insightful writing on the subject has been done by anthropologists. Murdock (1965) argues that a culture consists of habits that are shared by members of a society. It is the product of learning, not of heredity. Woolcock (2014) highlights how the sociologic scholarship has evolved to consider culture as “shaping a repertoire or ‘tool kit’ of habits, skills, and styles from which people construct ‘strategies of action” (Swidler, 1986, p.273).

​The Story of the 2015 World Development Report: Mind, Society, and Behavior

Varun Gauri's picture

English settlers to the New World believed that the climate of Newfoundland would be moderate, New England would be warm, and Virginia would be like southern Spain. These beliefs were based on the seemingly common sense view that climate is much the same at any given latitude around the globe.
 
What is striking is that these views persisted despite mounting evidence to the contrary. As late as 1620, after 13 years in the settlement, residents in Jamestown, Virginia, were still trying to import olive trees and other tropical plants, perhaps inspired by Father Andrew White, who had assured them that it was “probable that the soil will prove to be adapted to all the fruits of Italy, figs, pomegranates, oranges, olives, etc.” Eventually, the English settlers did adjust their mental models about North American climate. The accumulation of scientific data, combined with personal experience, was undeniable. But the adjustment was slow and costly, in terms of both money and lives lost.

Why Economics Today Should Give Us Hope: An Outsider’s View

Dani Clark's picture

At 23, starting graduate school for international relations, the prospect of taking economics frightened me. Having just spent my college career as a history major that marched for peace probably had something to do with it. There was also that time in 4th grade when I got a D in math, but we won’t go there.

Anyway, it was a very nice surprise when I found that the math and logic of economics made sense to me. I was proud of myself for “getting it.” And of course, for starting my own subscription to the Financial Times. Ah, the conspicuous consumption patterns of a newly-minted student of economics.

Roger Myerson goes on camera about his three week World Bank visit

Merrell Tuck-Primdahl's picture

Roger Myerson, eminent theorist and winner of the Nobel in economics, brought his abiding interest in democratic decentralization and development to the World Bank recently. He was hosted by the Development Economics Vice Presidency as a visiting fellow and spent three weeks here writing, thinking and meeting with staff from the Global Practice groups, from the Research Group, and from the East Asia region.
 
As his main output, Professor Myerson wrote a paper titled ‘Local Foundations for Better Governance: A review of Ghazala Mansuri and Vijayendra Rao’s Localizing Development’. He presented highlights from the paper to a diverse group of Bank staff on November 13.  The paper reflects on the theory and evidence for development strategies that are based on local community empowerment; it stresses that a key to viable democratic development in a nation is to increase the supply of leaders with good reputations for using public resources responsibly.

Does More Income Mobility = Higher Social Welfare?

William Maloney's picture
 Curt Carnemark / World BankIncome mobility is usually considered a good thing. It implies higher social welfare as the ability of individuals to move up and down the income ladder mitigates the impacts of poor income distribution. But it is also true that when income jumps up and down unexpectedly, life becomes riskier and planning, difficult. This is why making a general link between the mobility we observe in the data and welfare is not straightforward.


A common approach used to show high mobility is a low correlation of present and past incomes is captured, for instance, by the Hart index (cov lnyt, lnyt-1). If we assume, as is often done, that an individual’s income is comprised of a transitory component (short-term blips up or down in a self-employed person’s income that we can smooth, or even measurement error), and a permanent component where each income shock is persistent (say, an income loss after an involuntary job change (an AR (1) process with autoregressive coefficient, ρ), then the Hart index can be broken into three parts.

Evening It Up: A New Oxfam Report on Inequality

Dean Mitchell Jolliffe's picture

In Even it Up: Time to End Extreme Inequality, Oxfam has delivered another powerful report making the case that tackling inequality is essential to create a more just world and to eliminate extreme poverty. I was asked to comment on this newly released report at an October 31 event held at the IMF, and was as impressed by the presentation as I was with the report.

Oxfam effectively uses research findings to advocate for policy changes to reduce global inequality. This statistics-laden report also wisely features compelling stories about real people, helping the reader to better understand how vast disparities in wealth adversely affect wellbeing. Oxfam has consistently argued to bring inequality to the fore of policy discussions, and not surprisingly, this report appears to have created a groundswell for their global #Even It Up campaign. While there were instances where I found myself questioning the quality of some references supporting a few statements and estimates, my overall reaction was that the ‘big picture’ claims of the report were well substantiated. In my comments, I suggest that if this report is a call to action, a useful next step for Oxfam or a partner in this work, will be to bring more clarity to what it means to eliminate extreme inequality. Establishing a goal or a measure to monitor progress will help to create better policies, and ensure better collaboration across governments and institutions.

Friday Roundup: Agricultural Productivity & Poverty Reduction in Bangladesh, International Day for the Eradication of Poverty, A conversation with Yang Lan on Ending Extreme Poverty, Measuring Poverty, and Universal Health

LTD Editors's picture

A new working paper by Shahe Emran and Forhad Shilpi looks at the impact of increased agricultural productivity (e.g. through increased rainfall) on hired labor, wages and poverty. The paper finds a positive response of labor hours devoted to market activities as opposed to home production. Evidence also indicates that a positive rainfall shock increases per capita consumption significantly, thus implying that agricultural productivity increase played an important role in poverty reduction achieved in the last two decades in rural Bangladesh.

Today is the International Day for the Eradication of Poverty, and the theme for this year is 'Leave no one behind: think, decide and act together against extreme poverty.' Learn more, and follow on Twitter #endpoverty.

Poverty measurement and PPPs: The World Bank explains

LTD Editors's picture

As the editors of Let's Talk Development, we want to respond to questions raised recently in social media channels about use of 2011 International Comparison Program (ICP) as well as during events and discussions about poverty and measurements during the Annual Meetings of the World Bank and IMF last week.

The World Bank currently uses an international poverty line of $1.25 (per person per day) in 2005 prices to monitor global poverty. The process draws on several data sources, including the ICP. The most recent  global and regional poverty estimates cover the period 1981-2011 and are available from the recently updated Povcalnet database; they are based on data from well over 1,000 household surveys, covering nearly all developing countries. The latest estimates have been published and  explained in both the recent Policy Research Report and the Global Monitoring Report, published last week.

Parsing the challenges of measuring poverty and shared prosperity

Peter Lanjouw's picture

The data and processes needed to measure global poverty and gauge improvements in the prosperity of the bottom 40% of people in each country present complex challenges and provoke considerable debate amongst poverty experts.  

From the comparability of household surveys and their use in policy design to the utility of purchasing power parity data as a unifying standard for measuring the poor, the devil in global poverty analysis is in the details. It’s also vital to understand the World Bank’s recently adopted twin goals in a broader context, to see how they fit into a broader array of monitorable indicators that each come with their own specific features and insights. We must also listen to client governments and outside partners when they prefer to go beyond income to look at multidimensional social welfare functions.

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