Yes We Can and Yes We Must! Measuring Well-being and Progress in Developing Countries

This article, by Salema Gulbahar is part of the Wikiprogress series on the Global Forum for Development 2013 and post-2015, it reports specifically on the “Measuring Well-being and Progress in Developing Countries” session at the Forum.

Martine Durand opened the session and outlined the key questions to be addressed by the three panellists (full profiles below):

1. Does it make sense to talk about a more holistic approach to development when millions of people in developing countries still confronting extreme poverty and have unmet need for basic services including food, shelter and basic health care?
2. What is the relationship between concepts such as poverty, social cohesion and progress?
3. Can well-being be measured in countries that have less developed statistical systems, and what have been the specific challenges for Morocco and Mexico as they endeavored to do this? 

Photo by OECD/Christian Moutarde of  Mr. Olusegun Obasanjo, Former President, Federal Republic of Nigeria

“Yes we can and yes we must” measure development using a more holistic approach insisted Allister McGregor. There is a need for a common framework to assess and measure development for well-being in developed and developing countries as the boundaries between the two are becoming blurred.  The OECD provides a conceptual framework that can be taken and applied to individual country context. People’s well-being and aspiration can be expressed in most languages. 

Conceptually what is happening?

Income has been substituted for well-being and it was assumed that growth will deliver well-being for everyone but this is not so. To deliver well-being for everyone a  multi-dimensional approach is required. This does not replace existing measures as people still need food, shelter and water. Well-being is achieved though relationships, thus one needs to understand that well-being is a social concept. Methodological innovations are important as previously we suffered from ‘one size fits all’ idea.

"If people are what development is about, why do we not put them at the heart of our thinking and our measurement of development? "Allister McGregor.

Decision makers need to take the voices off the poor into consideration.  We need systemized, regular consultation, to include these voices in the global conversation – a bottom up approach. But everyone wants something different, so political systems need to be able to integrate the voices of people that are never heard, with a vision of where we are going ultimately. We should use human well-being as a focal point as it goes beyond income.

Gerardo Leyva Parra addressed the challenges for Mexico in developing well-being measures.  The first challenge was convincing people within the institution that measuring well-being beyond GDP and happiness in Mexico was possible and not only for developed countries.  They realised the potential for using well-being as a key tool in the measurement of development in Mexico.

Finding specific indicators was a challenge and thus the discussions were taken outside the walls of the institutions, involving government officials, think tanks, civil society and the private sector.  This continuous dialogue is essential and the need to be able to communicate that going beyond GDP and measuring happiness does not mean forgetting about basic material needs. The next step is to ensure that the new indicators are integrated and taken up by decision makers.

There is also a need to look at subjective well-being statistics from a positive rather than normative perspective. The micro data of subjective well-being surveys can provide valuable insights about the drivers that allow some people to live happy, more satisfactory and meaningful lives than others.

Mexico: Key learning from the process: 

1. Develop relevant indicators, with all stakeholder involved in the decision
2. Communicate the measuring progress beyond GDP concept
3. Keep in touch with relevant stakeholder with continuous dialogue to ensure indicators stay pertinent.

Providing decision maker with the data necessary to allow them to make informed decision about people’s well-being.

Khalid Soudi discussed the Morocco experience. Since the 1990s, the country has developed qualitative questions and found a divergence between the indicators and the perspective of the population. Thus a gap emerges between the finding of objective and subjective well-being responses, this highlights the importance of capturing people’s views.  

Morocco has three elements in its approaches and the global objective of providing decision maker with the data necessary allow them to make informed decision about people’s well-being:

  

• Social economic indicators – it has developed pallet of indicators on different dimension of well-being (the choices were dependent on the population – legitimized by people).
• Quality of life measurements - taking into account the affects and constraints people face and how this contributes to people’s well-being generally.
• Subjective well-being with different domains.

For several years, the HCP has been collecting and analysing qualitative data on public perceptions of their economic and social realities by:

• Including modules and subjective questions, of quantitative nature in regular surveys
• Conducting qualitative surveys (business, household, economic, survey companies etc. on the perception of the development of living standards).
• Implementing several analytical projects combining objective and subjective perceptions of the population data.
• Calculating and publishing the quarterly index of consumer confidence.

Morocco carried out a national study that included:

• a sample of: 3,200 people aged 15 years and older (including 2,080 in urban areas),
• a household questionnaire on socio- demographic characteristics of its members and living conditions,
• an Individual questionnaire on well-being (given to one adult per household) and
• a classification of fields and factors of well-being that were developed and validated on the basis a pilot survey.

Three groups of well-being dimensions were identified (see slide): 1) material well-being -  housing and income, 2) social domain - employment, health and education and 3) societal domain - family life and social environment including cultural, spiritual and recreation aspect of life.

See the full presentation, here.

Read the full background paper: Measuring Well-Being for Development

The session was moderated by: Ms. Martine Durand, Chief Statistician and Director of Statistics Directorate, OECD

Panelists included:

• Mr. Khalid Soudi, Observatoire des Conditions de Vie de la Population, Haut Commissariat au Plan, Morocco (Download PPT)
• Mr. Allister McGregor, Institute of Development Studies (IDS), United Kingdom
• Mr. Gerardo Leyva Parra, Deputy Director General for Research, National Institute of Statistics and Geography (INEGI), Mexico  

Watch the video broadcast of the Forum, here.

Salema Gulbahar

(Wikiprogress Coordinator)

Related articles

What Happened at the Global Forum on Development 2013?

Exploring New Approaches for Poverty Reduction

In Global Downturn, Sustainable Development Begins at Home

Impact of daycare interventions in Latin America

Urbanisation and increased female labour market participation have led to increased demand for daycare services, which in developing countries is partly met by government daycare programmes. Some of these programmes offer subsidised community daycare services, in which women from the community provide full time childcare in their home, food and some recreational or educational activities for the children. Other programmes offer public preschool education to children between 3 and 5 years of age. But do these daycare interventions benefit the child’s development?

Impact evaluations of these programmes were undertaken to assess their effectiveness by comparing the wellbeing of children cared for at daycare (or preschool) to those cared for at home. To synthesise the evidence, researchers of the National Institute of Public Health in Mexico (myself and Jef Leroy, currently at the International Food Policy Research Institute) and the Center for Research and Teaching in Economics (Maite Guijaro), undertook a systematic review. The study, The impact of daycare programmes on child health, nutrition and development in developing countries: a systematic review examined the effects of daycare interventions (formal out-of-home care) on the health, nutrition and development of children under five years of age, in low- and middle-income countries.

Photo sourced by 3ie

The systematic review identified 13,190 studies, but only six, based in Latin America, met the inclusion criteria in terms of scope, type and quality. Four studies evaluated community-based interventions and two looked at preschool interventions.

The findings showed that attending daycare had positive effects on language skills, social and emotional development of children in the short run. In the medium term, school attendance, student behaviour and test scores witnessed a positive trend. In fact, the effects on the children were more pronounced depending on the exposure to the programme. For example, the Bolivia daycare programme had a positive effect (2-11% increase) on bulk (gross) and fine motor, language and psycho-social skills for children with more than seven months of exposure to the programme. On medium-term outcomes, the Argentina study found that one year of preschool increased mathematics and Spanish test scores at third grade of primary education by eight percent. In Uruguay, it was found that children who attended at least one year of preschool, increased their schooling by nearly one additional year by the age of 15.

On child health outcomes, only one study from Colombia evaluated the impact on prevalence of diarrhoea and acute respiratory infections. Although this study found reductions in the prevalence of both diseases with longer exposure to the programme, it is not clear if the results are a true health effect of the programme or if the comparison group of children with less than one month of exposure to the programme, might have suffered from a steep increase in infections right after joining a daycare centre.

However, no conclusions could be drawn with respect to the nutrition outcomes. One study from Guatemala analysed child dietary intake and found positive impacts, a study from Bolivia found no impact on child growth, and two additional studies from Colombia found inconsistent results on child anthropometrics, such as height and weight.

Finally, the reviewed studies did not provide a good description of the type and quality of care children receive in the absence of the programme. This represents an important limitation of the reviewed studies since the potential impact a daycare programme might have is determined by the “net” treatment, which is the difference in the type and quality of care between daycare interventions and the alternative forms of child care in the absence of the programme. For instance, a positive “net” treatment effect can be expected if daycare interventions provide a high quality childcare alternative to mothers who take care of their children while working. However, a negative “net” treatment effect could be anticipated if children who receive adequate family care are enrolled into a low-quality daycare programme.

Policy implications

The evidence shows that daycare interventions in Latin America, community-based or school-based, have had a positive impact on child development. However, there is not enough evidence to conclude that these programmes have improved child health and nutrition. Based on this information, should policymakers decide not to implement daycare interventions until there is conclusive evidence about its impacts?

Considering the proven impact daycare interventions can have on improving child development in the short and medium term and the increasing demand for out-of-home care, these programmes should be implemented if they provide a high quality alternative to the care children normally receive.

However, it is crucial that new programmes are evaluated and closely monitored, not only to add to the very limited knowledge base of programme effectiveness and pathways of impact, but also to guarantee that unintended negative effects are identified and corrected.

(Paola Gadsden is the Coordinator of Analysis and Evaluation of Public Policies for the State of Morelos, Mexico)

3ie funds impact evaluations and systematic reviews that generate high quality evience on what works in development and why. Evidence on development effectiveness can inform policy and improve the lives of poor people.

Covering the “missing middle” in social protection

by Juan R. de Laiglesia from the OECD Development Centre 

Providing social protection to the informal middle classes will foster social cohesion, and doesn’t cost the earth.

As citizens across the globe demand new economic models, the OECD’s newly released Perspectives on Global Development 2012 puts social cohesion on the table as a broader social development objective. Social cohesion compounds inclusiveness, equal opportunity and a sense of belonging to society, of shared destinies. Strong growth in a large part of the developing world has transformed the ways development challenges can be addressed. 

The final declaration of the 4^th High Level Forum on Aid Effectiveness held in Busan last week reminds us that poverty and inequality remain a central challenge in global development.  The OECD’s Perspectives on Global Development 2012 find that 83 countries more than doubled OECD per capita growth rates over the past decade. You would be right to think that faster than 1.8% growth is hardly impressive; but in fact 49 countries grew at more than 3.75%. In the 1990s, only 12 countries managed that.

How growth has changed the picture

First, the poor no longer live mostly in poor countries. Research by Andy Sumner,  at the Institute for Development Studies , finds that 70% of the world’s poor live in middle income countries. Two decades ago, 93% of the poor lived in Low Income Countries. This means that most of the poor live in countries where per capita incomes are above USD 2.75 a day, and more in purchasing parity terms. In other words, more countries can use redistributive instruments – from taxes to transfers to health provision – to eradicate poverty. Indeed, countries such as India or China have up-scaled social protection interventions in recent years.

Second, millions have been lifted out of poverty as average incomes have increased and emerged as a new – but vulnerable ­– middle class. As a result, half of the 2bn-strong global middle class live in emerging economies. But make no mistake, this middle class is unlike Western stereotypes of a couple with two children, a dog and one or two cars.  The emerging middle classes are vulnerable: many remain only just above the poverty line and do not have a stock of capital that would allow them to buffer major shocks such as illness nor to whether the changes in fortunes which come with old age. In Latin America, less than 10% of households have mortgage loans, and less than half of them are middle-class. Many in the emerging middle classes work informally. And yet, not being poor, they have the capacity to save and contribute to social insurance. Social protection plays a key role in buttressing their middle class status and preventing them from slipping back into poverty.

Social protection redux

Is this a job for social protection? In the past few years, the discourse around the role of social protection in development has changed dramatically. Through the work of the OECD’s Development Assistance Committee, the donor community has clearly stated the role of social protection in making growth pro-poor. Last month, the Social Protection Floor Advisory Group, chaired by Michelle Bachelet released its report entitled Social Protection Floor for a Fair and Inclusive Globalization. Social protection has moved from being viewed as merely a “safety net” built of targeted assistance to the poor to a key instrument in building fairer societies.

The past ten years have seen a true “quiet revolution” in social protection in the developing world. The rapid introduction of means-tested cash benefits has greatly increased the scale of social protection. South Africa’s Child Support Grant, introduced in 1998 covered 7.7 million children by 2008, China’s Minimum Living Subsidy Scheme (DiBao) was introduced in 1997 and reached 57 million households by 2007. The very popular conditional cash transfer (CCT) programmes in Mexico (Oportunidades) and Brazil (Bolsa Família) reach respectively 5 and 12.5 million households or about a quarter of the population in each country. The beauty of this quantum leap is that it has been made using home-grown instruments, tried and tested across developing countries. Often these new programmes coexist with contribution-based social security systems that cover formal employees.

The “missing middle”: a challenge for social cohesion

Put together, contribution-based social security and means-tested social protection for the poor leave a “missing middle” in social protection coverage. Indeed, research at the OECD Development Centre shows that the majority of middle-class workers in emerging economies such as Brazil  or Mexico are not formal employees.  Contributory pensions are open to independent workers and informal employees – those without contracts – but in practice only a minority participate in them. In the case of Brazil only 15% of the self-employed and 9% of informal employees in the middle income quintiles contribute to pensions systems.

Providing adequate instruments for the informal middle classes to insure or manage risk matters for social cohesion. First because today’s vulnerable middle class can become tomorrow’s poor. Many in the emerging middle classes lie close to the poverty line and can fall back in downturns. Second, it is a matter of horizontal equity. Social protection is a form of institutionalized solidarity: excluding certain categories from social protection deprives them of risk management instruments which are usually not available in the private market. Moreover, it runs the risk of alienating that segment of society. Finally, the middle classes have an important role to play in shaping the politics of poverty reduction. How likely are the informal middle classes to side with the poor on redistribution issues if they do not partake in the system that protects the poor?

Extending protection: more than one way forward

Social protection can be extended to cover the informal middle classes in several ways. Unbundling health, pensions and the other functions of social security helps, because they can be priced and provided separately. Contributory pensions and Unemployment Insurance Savings Accounts as implemented in Chile are examples of such unbundling. Certain instruments, like UISAs (compulsory savings accounts from which withdrawals are made during unemployment spells) can be extended to informal workers. Since they pool little risk across workers, they do not entail cross-subsidies or generate incentives to stay out of formal work. Subsidising contributions to the social security system is also possible – for example by governments’ matching deposits into retirement accounts. Matching-defined contribution pensions following that model are being implemented in Mexico, Colombia and Peru. Universal entitlements are also used today across the developing world, especially for basic healthcare and pension income.  In all cases, the key is to break the dichotomy between a social protection system for formal workers and one – or none – for informal workers. Such duality reinforces the segmentation between labour markets and contributes to deepen the fault line between formal and informal workers.

At stake is building a social protection system that not only alleviates poverty, but empowers citizens to build up and protect human capital and to participate in networks of organised solidarity. The past decade saw the emergence of a number of innovative instruments in social protection, born and bred in the South. Making inclusive systems out of these and other innovations remains work in progress.