Jesko Hentschel

Constructing an indicator of consumption for the analysis of poverty : principles and illustrations with reference to Ecuador

This paper is concerned with the derivation of a welfare indicator for households from consumption data. It examines, illustrating with reference the data for Ecuador, several of the steps involved in constructing consumption aggregates and highlights some of the principles which should guide the analysis. The paper emphasizes that specific care is warranted where access is characterized by rationing. Simple methods are outlined to impute a hypothetical rent for owner-occupied housing, to include consumption of basic social services, and to calculate a stream of consumption derived from a stock of consumer durables. The paper demonstrates that the definition of consumption adopted can have a significant bearing on measured poverty, the profile of poverty might be quite robust to alternative consumption definitions. However, it argues that only after robustness has been firmly established should results be emphasized.

With the help of one's neighbors - externalities in the production of nutrition in Peru

Both public and private resources contribute to the nutritional status of children. In addition, the investments made by one household may contribute to the health of other households in the neighborhood through improvements in the sanitation environment and through increases in shared knowledge. This paper measures the externalities of investments in nutrition by indicating the impact of the education of women in Peruvian neighborhoods on the nutrition of children in other households, after controlling for the education and income of those households. We find that in rural areas this shared knowledge has a significant impact on nutrition, with the coefficient of an increase in the average education of women in the neighborhood being appreciable larger than the coefficient of education in isolation. In addition, we indicate the impact of the water and sanitation environment in the neighborhood, again controlling for the households own access to sanitation and water. In both urban and rural areas, we observe externalities from investments in such household level infrastructure with the evidence particularly strong for sanitation made by neighboring households.

Contextuality and data collection methods: A framework and application to health service utilisation

This article examines the role of different data collection methods, including the data types they produce, in the analysis of social phenomena in developing countries. It points out that one of the confusing factors surrounding the quantitative-qualitative debate in the literature is that methods and data are not clearly separated. The article retains the qualitative/quantitative distinction pertaining to data types but analyses methods according to their contextuality, that is, to what degree they attempt to understand human behaviour within the social, cultural, economic and political environment of a locality. The framework is applied to characterise information needs for health planning derived from the utilisation of health services. Each combination of method (contextual/non-contextual) and data (quantitative/qualitative) is a primary and unique source to fulfil different information requirements. The article finds three roles contextual methods of data collection can play in generating information needs for understanding health utilisation patterns. It concludes with a brief discussion on how contextual and non-contextual methods can — and need to be - formally linked to understand more fully the comparative strengths of the different methods.

Rural Poverty in Ecuador: Assessing Local Realities for the Development of Anti-poverty Programs

Abstract This paper examines how the inhabitants of four poor communities in the rural Ecuadorian highlands perceive poverty and conceive of strategies to overcome it. While seemingly similar with respect to location, market access, ethnicity, and access to health care and primary schools, the four communities are quite heterogeneous, particularly with respect to educational achievement, basic services, supply, and access to productive resources such as land. Nevertheless, perceptions of poverty vary relatively little, and coping strategies build uniformly on temporary migration, increased female and child labor, and decreased consumption. Practical solutions for poverty reduction include credit and training. Community characteristics are also important in determining individual preferences. Rural anti-poverty policies for Ecuador (and possibly other Andean countries), can build on such similarities among heterogeneous communities.

The City Poverty Assessment A Primer

This paper provides an introduction to the concept of, and tools used in City Poverty Assessments. There is no standard content to such assessments; rather, they need to be adapted to the specific needs of the city involved. Several aspects of urban poverty touched on in this paper will be irrelevant to certain circumstances, while others not mentioned here will be crucial. The thrust of City Poverty Assessments is to provide city policymakers with good and thorough information about the situation of the citys poor, the key determinants of poverty, the functioning of city anti-poverty programs, the distribution of city finances, and the link between poverty and city growth. Many of the tools used when developing City Poverty Assessments are valuable planning tools in and of themselves, such as poverty maps, institutional maps, tracking of the incidence of taxes and expenditures, and rapid service satisfaction surveys. Further, the very process of preparing a City Poverty Assessment which includes collecting information, analyzing it, and discussing it with all relevant actors, including the poor will be of major importance in forming new and more effective partnerships for city poverty reduction.

Household welfare measurement and the pricing of basic services

The authors discuss when and how to adjust expenditures derived from household surveys to reflect the consumption of basic services. They discuss simple adjustment methods for markets that are subsidized, rationed, or subject to increasing marginal tariff pricing. Using Ecuador as an example, they show how incorporating adjustments in markets for water, electricity, and cooking gas can significantly alter estimates of poverty and are therefore important to comprehensive measure of welfare. For Ecuador, adjustments must be made for water, for example, because the nonpoor urban population often has access to subsidized public water and the poor depend on the private market; adjustments must be made for electricity because increasing marginal tariff rates lead to different prices per kilowatt-hour (kwh). Adjustments need not be made for cooking gas, which is highly subsidized in Ecuador, because the amount consumers use is not rationed. The authors compare the sensitivity of poverty indicators and the poverty profile in Ecuador to adjustments in nominal expenditures for basic services in Ecuador. The poverty indicators (headcount and the poverty gap for extreme poverty) showed changes that were statistically significant. The results dramatize how important it is to carefully analyze markets for basic services when deriving welfare measures from household surveys. Such adjustments, by improving the measure of welfare, can also encourage wider acceptance and use of consumption as welfare indicator and a guide for developing public policy.

Bundling Services and Household Welfare in Developing Countries: The Case of Peru

Using panel data for Peru for 1994-2000, the authors find that when households receive two, or more services jointly, the welfare increases as measured by changes in consumption are larger than when services are provided separately. The increases appear to be more than proportional, as F-tests on the coefficients of the corresponding regressors confirm. Thus, the authors find that bundling services may help realize welfare effects.

From Occupations to Embedded Skills A Cross-Country Comparison

This paper derives the skill content of 30 countries, ranging from low-income to high-income ones, from the occupational structure of their economies. Five different skills are defined.. Cross-country measures of skill content show that the intensity of national production of manual skills declines with per capita income in a monotonic way, while it increases for non-routine cognitive and interpersonal skills. For some countries, the analysis is able to trace the development of skill intensities of aggregate production over time. The paper finds that although the increasing intensity of non-routine skills is uniform across countries, patterns of skill intensities with respect to different forms of routine skills differ markedly.

Protection in good and bad times ? the Turkish green card health program

This paper evaluates the equity and financial protection implications of the expansion of the Green Card (Yesil Kart) non-contributory health insurance program in Turkey during the growth years from 2003 to 2008. It also considers the programs protective impact during the economic crisis in 2009. The authors find that the rapid expansion of the program between 2003 and 2008 was highly progressive. It led to significant gains in coverage of the poor but offered limited financial protection as out-of-pocket expenditures even before the introduction of the program had been limited. Using a specialized welfare monitoring survey, fielded in 2009, the authors estimate the impact of the program on household level health care utilization during the first phase of the economic slowdown in Turkey. Using three different estimation techniques, they find that the Green Card program had a significantly positive impact on protecting health care utilization during the crisis.

Bundling of Basic Public Services and Household Welfare in Developing Countries: An Empirical Exploration for the Case of Peru

Using panel data for Peru for the period 1994–2000, we found that increases in household welfare, as measured by changes in consumption, are larger when households receive two or more services jointly than when services are provided separately. Such increases appear to be more than proportional, as F-tests on the coefficients of the corresponding regressors confirm. Thus, we found that bundling of services may help realize welfare effects. This finding is particularly robust in the case of urban areas.