MAMS to each individual (or household) in the survey, which produces a new distribution of income and translates the evolution of macro variables into poverty and inequality outcomes. Although significantly more data-intensive than the simpler poverty elasticity-based method, the micro-simulation approach allows for a wider range of mechanisms for escaping poverty, including moving from agricultural employment to non-farm activities where the wages tend to be higher, upgrading individual skills (through schooling), changes in relative wages, and an economy-wide growth component that equally benefits all households.

# **3 Policy lessons from MAMS work**

## **3.1 Millennium Development Goals for Honduras and Ghana: current achievements and forthcoming challenges**

The first important message that emerges from a quantitative assessment of the MDG situation in the two countries under study is that performance on individual goals varies substantially. Given the initial situation and the likely public expenditure trends over the next decade, progress towards MDGs is likely to be uneven across the two countries. Thus, even if the overall total financing requirements are broadly similar in Ghana and Honduras, the challenges facing Ghanaian and Honduran policy makers – as well as the strategies to overcome these challenges – reflect the specificity of each country’s circumstances (see Table 2 and Table 3).

**Table 2 Current MDG** **<u>situation and baseline performance: Ghana and Honduras</u>**

||1990|Hondu<br>2004<br>(|ras<br>2015<br>Target)<br>D<br>c<br>in|istance<br>overed<br>‘base’|1990|Ghan<br>2004<br>(|a<br>2015<br>Target)|<br>Distance<br>covered<br>in ‘base’|
|---|---|---|---|---|---|---|---|---|
|MDG 1: People living below the national<br>poverty line (% of pop.)|84|64|42|28%|52|31|26|<br>384%|
|MDG 2: Primary completion rate (% of<br>relevant age group)|65|76|100|63%||47|100|<br>76%|
|MDG 4: Under-five mortality rate (per<br>1,000 births)|59|31|20|16%|122|112|40|<br>20%|
|MDG 5: Maternal mortality rate (per<br>100,000 live births)|180|108|70|17%|740|503|185|<br>20%|
|MDG 7a: Access to an improved water<br>source (% of population)|73|82|95|14%|54|56|85|<br>21%|
|MDG 7b: Access to improved sanitation<br>facilities(% ofpop.)|66|77|95|15%|21|35|85|<br>23%|

Source: www.developmentgoals.org, www.sierp.hn, millenniumindicators.un.org, G-JAS (2007), AMCOW (2006). Note: The table lists individual goals (2015 levels) as defined by national authorities, which may be more or less ambitious than the percentage improvements from 1990 levels which are used as the official definition by the UN.

In 2004, the base year for MAMS, Honduras seems in a better position than Ghana for all the MDGs. The Latin American country has recorded better achievements in terms of education, mortality rates, and population coverage for basic water and sanitation services.<sup>11</sup> However, this better initial situation does not necessarily mean that the 2015 targets are more easily reachable. In fact, since the targets are expressed as a relative improvements from the 1990 situation (apart from education where universal primary

> 11 Notice that the poverty performance is difficult to compare because the national poverty lines differ across countries.

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