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Nathanael Goldberg, A Deeper Look at Programs that Work with the Ultra-Poor: From Safety Net Programs to Other Innovations


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Nathanael Goldberg, A Deeper Look at Programs that Work with the Ultra-Poor: From Safety Net Programs to Other Innovations

  1. 1. Ultra Poor Graduation Pilots:Spanning the gap between charity & microfinance Nathanael Goldberg, Policy Director Valladolid, November 14, 2011
  2. 2. Ultra Poor Graduation ModelProgram designed by BRACto target ultra poorhouseholds Holistic approach: support household needs for savings, financial education, skills training, healthcareTargeting Use PWR to identify ultra poor households
  3. 3. Ultra Poor Graduation ModelSource: CGAP (
  4. 4. Why not just microfinance?Substantial numbers of clients do not take up traditionalproductsCOUNTRY FIELD PARTNER PRODUCT TAKE-UP RATE (%)Mexico Compartamos Credit 4Peru Arariwa Credit 7.9South Africa Credit Indemnity Credit 8.7Ghana Opportunity International Credit 1.8Philippines Green Bank Insurance 27Philippines Green Bank Insurance 46Kenya K-Rep Development Agency Savings 55Philippines First Isabela Cooperative Bank Savings 2.5Philippines First Valley Bank Savings 23Philippines Green Bank Savings 28
  5. 5. Who are the Ultra Poor:Consumption In past 12 months, did HH members get enough food? Large share of expenses spent on food and fuel: Yemen No Pakistan: 54% of total 18.6 % budget India: 72% Some Months Peru: 70% 45 % Yemen: 69% of stipend Majority have at least 2 All Year Not Enough Some Months I Dont Know meals a day India: 62% Pakistan No 11% Yes Pakistan: 75% 33% Yemen: 87.5% Ethiopia: 83% Some But, seasonality Months 56%
  6. 6. Who are the Ultra Poor: Income-Generating Activities PakistanType of activities: ACTIVITY OF THE HEAD OF HOUSEHOLD Percent India: Farming Land 2.15 12% report agricultural labor tending animals 1.43 as main source of income Selfemployed in business 3.06 Fishing 2.99 1% cultivate land owned by Housework 6.05 Agricultural labor 6.84 household Daily labor fishing 15.49 Pakistan: Daily Labor Other Formal Employment Salaried 40.04 3.45 Does not work 13.15 Avg 1.4 activities Other 5.34 13% no activities Total 100 Main activity is daily labor in agriculture or fishing Only 2% cultivate land they own
  7. 7. Who are the Ultra Poor: School Enrollment Percent Enrolled 0.99 1 0.94 0.76 0.790.80.6 0.40.4 0.330.2 0 India Pakistan Peru (6-12) Peru (13-16) Honduras (6- Honduras 12) (13-16)
  8. 8. Who are the Ultra Poor:HealthShocks India: 29% of selected HH experience 1 or more health shock in past year Pakistan: Medical expenses 12% of HH budgetAccess to care More than 1 hour to nearest health center Peru: 24-30% Honduras: 28-58%
  9. 9. Replication at 10 SitesReplication sponsored by CGAP and Ford Foundation: Haiti,Honduras, Peru, Ghana, Ethiopia, Yemen, Pakistan, India(3)Randomized evaluation at 8 sites
  10. 10. Why Evaluate?What is the impact of theGraduation model on theultra poor? Impact evaluation measures: How have the lives of clients changed compared to how they would have changed in the absence of the program Note this is different from “How have their lives changed”
  11. 11. Impact: What is it? InterventionPrimary Outcome Impact Time
  12. 12. Why do we need a control group?What does it mean when your clients face: Macroeconomic changes (+/-) My program is good! Agricultural shocks (+/-) My program is bad! Price shocks (-) My program is bad! New road (+) My program is good! Government subsidies (+) My program is good!The control group gives us the counterfactual A randomized control group ensures we compare similar types of people
  13. 13. Study Design Collect data on eligible households Baseline Some sites: also collect data from non-ultra poor householdsConsumption Many sites have quarterly surveys to monitor surveys changes Survey re-applied to baseline households Endline after 2 years Follow-up 1 year after Endline- track more long-term impacts survey
  14. 14. Survey ModulesHousehold informationHealth indicatorsEducationConsumptionIncome and activitiesAssetsCreditRisk preferencesOngoing qualitativeresearch
  15. 15. Cost per clientCost Includes: Country Cost/client (US$) Consumption support India $330-$650 Asset transfer Haiti $1,900 Staff costs Head office overheadProportion of cost spent on each program component variesby countryWhich parts of the program create the most impact? Need evaluations to separate contributions of individual components
  16. 16. Ghana Ultra Poor Pilot Design 241 Communities (3,981 households) Asset Control:Core Module: Savings Only: Only: 7678 communities 77 communities 10 comm. comm. control asset only PureRegular Regular Matched HH HH controlSusu UP only Susu control HH Savings HHSavings HH Savings HH& UP HH HH Randomize communities, then households Measure spillovers of program by comparing ‘pure’ control households with control households in treatment communities Next year: randomize employment program
  17. 17. Initial Results: BandhanIncrease in foodconsumption mean difference of Rs. 64 per person per month represents 15% of control group mean greater than 25% for excluding those who refused participationlittle indication of increasein non-food consumption
  18. 18. Initial Results: BandhanIncreased Food Security less likely to skip or reduce meals, especially among adultsHealth Increase in health knowledge (hand washing, etc.) Decreased emotional stress and increased life satisfaction Little impact on physical health
  19. 19. Initial Results: SKSNo significant increases inconsumption Shift in income: agriculture livestock8% less likely to receive“below the poverty line”rationsNo impact on children in schoolDecreased amounts ofoutstanding loans by 84% ofinitial average amount Less likely to borrow from money lender
  20. 20. Initial Results: SKS More likely to be saving, impact on amount is uncertain Health Reported being sick less: lost 2 fewer work days (in month prior to interview) to sickness (which is 56% of baseline number of days lost) 12% less likely to have gone to doctor/hospital in past year
  21. 21. Take-away points Integrated approach: Ultra Poor Graduation Model takes holistic approach to addressing needs of households in extreme poverty Evaluation is essential: Does the graduation program help ultra poor to generate income, build up assets, increase consumption? RCTs answer these questions. Early impacts mixed but promising: Initial results tentatively suggest model is working, but long-term results will be key Improving the model: Which program components are most useful? Ghana evaluation will explore this question by randomizing program components Suggest most cost-effective way to scale program
  22. 22. Thank You!