Poverty and Social Impact Analysis

1
Poverty and Social Impact Analysis

• DFID SEMINAR SERIES
• Spring 2003

2
Origins of PSIA

• Adjustment with Human Face
• Social Dimensions of Adjustment
• ESAF independent review
• PRGF Key Features
• PRSC

3
What is PSIA?

• Analysis of intended and unintended consequences
  of policy interventionsex ante, during their
  implementation, or ex poston the well-being of
  different social groups, with a special focus on
  the vulnerable and the poor. Well-being, or
  welfare, includes the income and non-income
  dimensions of poverty (JIC Concept Note April
  2001).

4
Why Do Pilots?

• Demonstration effect
• Embed in PRS process (national ownership of
  analysis)
• Ensure multi disciplinarity
• Be pragmatic (what is possible using existing
  data knowledge)
• Be flexible and policy-oriented (respond in real
  time)
• Enhance our capacity to influence IFIs

5
Operationalising PSIA pilots

• Demand-led
• government interest in poverty and social impact
  analysis of specific policies or programmes
• timely relative to PRSP process and PRGF, PRSC,
  SAL negotiations
• country programme advisors prepared to follow-up
  in medium term (capacity building)
• Counties Rwanda, Uganda, Mozambique, Armenia,
  Honduras, Indonesia, Orissa State (Pakistan)
• International and national researchers (40 days
  each social economic analysts)

6
DFID/HMT strategy

• Call for improvements in Fund/Bank policy and
  practice
• PSIA in PRGF/CAS/PRSC
• More upstream Bank/Fund co-ordination
• Greater transparency Bank website, civil
  society engagement in PSIA and its results
• Engagement at Board level
• IMFC call for systematic approach
• Reports at Annual meetings
• IDA13 language
• ChX and SoS engagement
• Joint Technical level work
• October workshop WB/DFID/IMF
• Secondments to PREM

7
What Did We Learn?

• PSIA can in a short time and using existing
  knowledge - identify certain kinds of impact of
  specific policies on the poor, and add important
  missing ingredients to a policy debate
• PSIA can identify livelihood groups that will be
  adversely affected and risks of increased
  vulnerability of individuals and groups
• PSIA can inform design complementary policies
  needed to minimise anti-poor impacts
• But, it is easier to analyse impact of a specific
  policy (within a macro framework that is
  delivering stability and growth) than it is to
  analyse the whole of the macro framework (Rwanda
  PSIA)
• And, PSIAs of specific reforms will not be able
  to cover all possible policy-relevant analysis
  for that reform (Mozambique)

8
Methods

• Good practice involves combining data from
  economic and social analysis
• Social analysis can generate hypotheses tested
  through econometric techniques, and information
  about particular groups. Economic analysis
  generates data on key variables (price effects
  impact on HH consumption)
• Research design should specify at outset how
  economic, social analyses will be sequenced and
  combined.
• Requires sufficient planning time upstream and
  skills in managing communicating across
  disciplinary boundaries
• There is untapped potential in information
  presently available in country
• Short, focused fieldwork can pay big dividends
• HH survey data not always useful to identify
  livelihood groups (income sources not always
  specified use of broad-brush categories such as
  urban/rural)

9
Process

• Too early to see evidence of policy impact, but
  early indications promising (Uganda Armenia)
• Anchoring PSIA institutionally in PRS process and
  enabling national stakeholders (governments) to
  take the lead are likely to be critical factors
  in maximising potential of PSIA to
• Inform policy design and implementation
• Inform national debates and build constituencies
  for reform
• Bilaterals have a role to play in supporting PSIA
  where independent analysis is seen as important
  
• Ideally, a PSIA programme is planned upstream
  through broad stakeholder engagement on choice of
  policies and how research will proceed (Ghana)
• But expectations need to be managed and
  possibilities for conflict recognised
• Strong interest in/demand for PSIA capacity
  building