Back in 2003, when we were writing the 2004 World Development Report, Making Services Work for Poor People, we had no idea that it would spawn so much research, innovation, debate and changes in the delivery of basic services. Last week, we had a fascinating conference, in collaboration with the Overseas Development Institute, to review this work, and chart the agenda for the coming decade. Being a blogger, I wanted to speak about what WDR2004 got wrong, but some of my teammates suggested I should start by describing what we got right. So here are three ways WDR2004 changed the conversation about service delivery (what we got wrong will be the next post).
Services are particularly failing poor people. Outcomes—child mortality, educational attainment, access to clean water, etc.—are significantly worse for the poorest 20 percent compared with the richest 20 percent. And service delivery fails where poor people live—in rural Uganda, public-school teachers are absent about 30 percent of the time; in Bihar (India’s poorest state), doctors are absent from public clinics 67 percent of the time. While this point was even in the title of the report, it has taken on particular salience in light of the discussions about inequality today.
Poor people may be stuck in a low-level political equilibrium because political support for improving services is weak. The middle- and upper-classes have opted out of the system: they send their children to private schools, pay for high-quality medical care, and have their own electricity generators and wells. Even the poor may not lobby for change because they have found ways of coping: they buy water from water vendors (at 5-16 times the meter rate); they organize private schools that charge “a dime a day.” Champaben, the Gujarati woman I lived and worked with as part of my Village Immersion Program, took her sick child to an unqualified, private doctor because the doctor in the free public clinic “was never there.” When I asked why he was never there, she replied, “Because the rains didn’t come this year.” If poor people think that absentee doctors are due to a failure of the weather rather than of public policy, politicians have little incentive to campaign for improved public services, and the system perpetuates itself.
Money is not the solution. Almost all cross-country studies that control for per-capita income find no relationship between public spending on health and education, and health and education outcomes, such as child mortality and primary completion rates. Within-country studies explain why. These subsidies accrue mainly to the non-poor: the lion’s share of public health spending, for instance, goes for hospitals, which are located in urban areas. Even the small share that goes towards primary clinics or schools often “leaks” (in Chad, the leakage rate for non-wage public health spending is 99 percent). The wage spending goes to teachers and doctors who are absent about 20-40 percent of the time. When present, doctors in Tanzania and Senegal spend a total of 29 and 39 minutes a day seeing patients; in Delhi, unqualified private doctors (sometimes referred to as “quacks”) give better quality service than the qualified public doctors. In light of this evidence, if someone suggests that with, say, an additional $57 billion in aid, we can reach the Millennium Development Goals—don’t believe them!
“The solution” is not the solution. The traditional view, not just of service delivery but development more generally, can be described as, “When you see a problem, fix it.” If there are 67 million children out of school, get them into school. Build schools, give scholarships, make schooling mandatory. If teachers aren’t teaching, pay them more (even though public school teachers in Punjab, Pakistan are paid more and absenteeism increases with teacher salaries); if they aren’t qualified, give them training; and give them bonuses to be present. If doctors aren’t showing up in clinics, give them better equipment, medicines (and stop them from migrating). If poor people aren’t getting water, fix the pipes or increase the supply of water.
The 2004 WDR was part of a different view, namely, that the problem is with the system. We need to ask: why are the children not in school, the doctors not in the clinic, the pipes never fixed? The answer typically is that incentives throughout the system are misaligned. Doctors are paid whether they are present in the clinic or not, and there are huge rents to be earned in private practice (people are desperate when their kid is sick). Furthermore, doctors’ and teachers’ unions are politically powerful, and have been known to resist efforts that increase their members’ accountability.
The implication is that solving the proximate problem (“the solution”) may not actually address the systemic issues. Higher pay for teachers will increase the rents that absentee teachers already earn. There is plenty of evidence that teacher training doesn’t improve performance—because better performance is not rewarded.
In fact, “the solution” may make matters worse. It is now widely recognized that, even in countries with high levels of primary enrolment, learning outcomes are very poor. Yet, calls for universal enrolment (to get the out-of-school children into school) are widely embraced, whereas calls for universal learning (all children must be able to read by age 7, say) are sometimes resisted. One reason is that enrolment is much easier to achieve than learning. Another could be that universal enrolment means more public-sector jobs, whereas a universal learning goal could mean more resources for private schools. Hence, the focus on enrolment may be detracting from achieving what education is all about, namely, learning.
If poor people are stuck in a low-level equilibrium of poor service delivery, if money is not the solution, and even the proximate solution is not the solution, what can be done? That was what the conference was about, so stay tuned. Also, for the three things the 2004 WDR got wrong.