rafmacalaba/datause-encoder-data huggingface dataset:
Policy Research Working Paper 6157

# **Abstract**

There has long been a concern among policymakers that too much of remittances are consumed and too little saved, limiting the development impact of migration. Financial literacy programs have become an increasingly popular way to try and address this issue, but to date there is no evidence that they are effective in inducing savings among remittance-receiving households, nor is it clear whether such programs are best targeted at the migrant, the remittance receiver, or both. The authors conducted a randomized experiment in Indonesia which allocated migrants and their families to a control group, a migrant-only training group, a family member-only training group, and a training group in which both the migrant and a family member were trained. Three rounds of follow-up surveys are then used to measure impacts on the financial knowledge, behaviors, and remittance and savings outcomes of the remaining household. They find that training both the migrant and the family member together has large and significant impacts on knowledge, behaviors, and savings. Training the family member alone has some positive, but smaller effects, whilst training only the migrant leads to no impacts on the remaining family members. The results show that financial education can have large effects when provided at a teachable moment, but that this impact varies greatly with who receives training This paper is a product of the Finance and Private Sector Development Team, Development Research Group; and Financial and Private Sector Department, East Asia and Pacific Region. It is part of a larger effort by the World Bank to provide open access to its research and make a contribution to development policy discussions around the world. Policy Research Working Papers are also posted on the Web at http://econ.worldbank.org. The authors may be contacted at ydoi@worldbank.org, dmckenzie@worldbank.org, and bzia@worldbank.org.

_The Impact Evaluation Series has been established in recognition of the importance of impact evaluation studies for World Bank operations and for development in general. The series serves as a vehicle for the dissemination of findings of those studies. Papers in this series are part of the Bank’s Policy Research Working Paper Series. The papers carry the names of the authors and should be cited accordingly. The findings, interpretations, and conclusions expressed in this paper are entirely those of the authors. They do not necessarily represent the views of the International Bank for Reconstruction and Development/World Bank and its affiliated organizations, or those of the Executive Directors of the World Bank or the governments they represent._ Produced by the Research Support Team
**Table 5: Inequality Estimates from Partially Synthetic Datasets, by Country/Year, Definition of the Middle Class and Index**

|||**Model**<sup>**a**</sup>|||||**$5.5/day**|||||||**$10/d**|**ay**|||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
|**Country**|**Year**|||_Middle_<br>_class_|||||||_Middle_<br>_class_|||||||
|||_Consumption_|_Income_|<br>_size_<br>_(%)_||_Gini_<sup>_b_</sup>||_MLD_<sup>_b_</sup>||_Theil_<sup>_b_</sup>|<br>_size_<br>_(%)_||_Gini_<sup>_b_</sup>||_MLD_<sup>_b_</sup>||_Theil_<sup>_b_</sup>|
|Burkina<br>Faso|2014|D|GB2|8.060|0.469|(0.031)|0.384|(0.068)|0.746|(0.255)|1.960|0.418|(0.028)|0.301|(0.058)|0.558|(0.222)|
|Ethiopia|2014|SM|GB2|2.230|0.431|(0.026)|0.326|(0.051)|0.501|(0.165)|0.690|0.420|(0.029)|0.311|(0.071)|0.467|(0.187)|
|Ethiopia|2016|GB2|GB2|1.300|0.419|(0.025)|0.308|(0.052)|0.481|(0.183)|0.150|0.381|(0.015)|0.248|(0.025)|0.302|(0.099)|
|Ghana|2005|GB2|GB2|20.260|0.455|(0.008)|0.359|(0.013)|0.414|(0.029)|5.880|0.438|(0.007)|0.334|(0.012)|0.382|(0.027)|
|Kenya|2005|GB2|SM|31.370|0.616|(0.024)|0.691|(0.074)|1.075|(0.256)|14.190|0.608|(0.023)|0.671|(0.067)|1.047|(0.239)|
|Malawi|2013|D|SM|10.050|0.445|(0.020)|0.338|(0.036)|0.510|(0.117)|2.620|0.411|(0.017)|0.289|(0.029)|0.420|(0.100)|
|Malawi|2017|GB2|GB2|66.500|0.553|(0.027)|0.532|(0.076)|0.947|(0.264)|28.690|0.540|(0.029)|0.510|(0.078)|0.925|(0.274)|
|Niger|2011|D|SM|5.850|0.332|(0.011)|0.185|(0.014)|0.246|(0.035)|1.030|0.311|(0.007)|0.160|(0.008)|0.201|(0.022)|
|Niger|2014|GB2|D|6.670|0.417|(0.024)|0.299|(0.045)|0.473|(0.144)|1.160|0.372|(0.014)|0.234|(0.023)|0.328|(0.086)|
|Nigeria|2004|GB2|GB2|6.600|0.451|(0.011)|0.356|(0.021)|0.466|(0.075)|1.090|0.415|(0.009)|0.300|(0.016)|0.353|(0.059)|
|Rwanda|2014|GB2|GB2|8.120|0.513|(0.019)|0.453|(0.041)|0.754|(0.170)|2.750|0.493|(0.018)|0.417|(0.038)|0.677|(0.157)|
|Tanzania|2009|GB2|GB2|7.300|0.413|(0.012)|0.285|(0.018)|0.359|(0.044)|1.670|0.401|(0.009)|0.268|(0.014)|0.329|(0.035)|
|Tanzania|2013|GB2|GB2|10.580|0.451|(0.012)|0.344|(0.020)|0.436|(0.053)|2.370|0.427|(0.010)|0.309|(0.016)|0.375|(0.045)|
|Uganda|2005|GB2|GB2|6.380|0.582|(0.035)|0.607|(0.109)|1.174|(0.358)|2.000|0.542|(0.034)|0.518|(0.094)|0.966|(0.332)|

_Source:_ World Bank.

_Note:_ the numbers in parentheses denote the estimated standard errors derived using the methods discussed in section 4.1. MLD = mean log deviation. a. GB2 = generalized beta II; D = Dagum; SM = Singh-Maddala.

b. Average of the point estimates derived from each of the R = 1,000 partially synthetic data set.

40
Figure 11: Economic Performance of African Countries by Quality of Policy, 2000-06 Figure 12: Inflation Pattern of African Countries Number of countries by inflation range <!-- Start of picture text --> 50<br>16.0<br>14.0 13.5 45 03 1 3 202 30 2 111 211 111<br>12.0 4035 4 3 6 6 4 6 7 35 6 7 44 2 3 2 3 21 2123 45 3 2 9 7 12 10 9 >50%<br>10.08.06.0 4.9 5.1 6.4 6.9 CPIA < 3.5CPIA ≥ 3.5 302520 7 22 74 2 6 1 5 9 22 1105 83 2 5 3 3 55 12 1033 2 5 5 4 31~50%21~30%<br>4.0 3.9 CPIA ≥ 3.5, low income 15 8 30 32 33 36 32 34 31 32 33<br>excl. oil countries 4 25 28 11~20%<br>2.0 10 21 20 20 20 18 20 21 22 17<br>0.0 5 10 <=10%<br>Growth (%) Inflation (%) 0<br>198619871988198919901991199219931994199519961997199819992000200120022003200420052006<br>N o . o f C o u n tr ie s<br><!-- End of picture text --> Sources: AFRCE various years; World Bank various years g.

In recent years, all these countries except Zimbabwe have been able to contain inflation drastically. The regional average has fallen below 10 percent since 2002.<sup>31</sup> This performance is all the more remarkable in view of the significant increase in oil prices that started in 1999.

Another indicator of macroeconomic stabilization, the overall fiscal balance, also improved.<sup>32</sup> The average fiscal deficit as a percentage of GDP in African countries declined from 5.7 percent during the 1980s and 1990s to 2.9 percent during 2000–06. Fiscal policy in oil-exporting countries has also improved. Unlike the unchecked wasteful spending in the past, windfalls from oil revenue are increasingly being saved. At the start of the current oil price shock, fiscal deficits were increasingly reduced, and by 2004–06, the overall fiscal surplus averaged about 8 percent for the group. More needs to be done, and two recent papers examine the issues relating to fiscal policy and rules: Devlin, Lewin, and Ranaweera. (2008) examine the fiscal management of oil revenue to improve its effect on growth, while Budina and van Wijnbergen (2008) look at the role of fiscal policy in managing oil revenue volatility in the case of Nigeria.

**_Adjustment to Higher Oil Prices._** For the past seven to eight years, most oilimporting countries in Africa have already been slowly adjusting to the new and higher trend of oil prices, and their ability to continue the adjustment will be the key to future growth, especially if higher oil prices persist. Since 2003, the majority of African countries have allowed frequent and full passthrough of higher oil prices to domestic

> 31 Excluding the hyperinflation in Angola and Zimbabwe . In Angola’s case, inflation fell over 300 percent in 2000 to about 13 percent in 2006.

> 32 Low-income countries in Africa are generally constrained from borrowing in international capital markets. As a result, the current account balance, the other significant macrobalance, is not a policydependent variable or a good indicator of macroeconomic management. Imports in these countries tend to adjust to export revenues and aid inflows.

28
# **3 REGULATORY FRAMEWORK**

The regulatory framework surrounding the pension sector has always focused on the ability of individual pension institutions to fulfill their future pension obligations. Pension institutions have two main sources of capital for absorbing losses without affecting the guaranteed benefits to policyholders: the collective bonus reserves that represent the undistributed profits that belong to policyholders; and own equity funds (paid up capital and retained earnings) that belong to the owners of pension institutions. The solvency ratio measures the ratio of own funds to the minimum capital requirement and is a basic indicator of solvency. The collective bonus reserves also provide an indication of the ability to absorb losses.

Prior to 2003 neither of these measurements took the risk profile of each pension institution into account. It was not until 2003 that it became mandatory to use mark-tomarket asset valuations.<sup>1</sup> Considering the growing exposure to global markets and the potential impact of adverse market conditions, there was a need for the Danish FSA to find new ways to look at financial strength and capital requirements. The Danish FSA decided to follow the stress-test route through a so-called “traffic light” system.

_Table 8: The Traffic Light System, 2001 - 2005_

||N<br>|umber of Institut<br>|ions<br>|
|---|---|---|---|
||Red Light|Yellow Light|Green Light|
|2001|1|40|49|
|2002|2|11|58|
|2003|0|2|66|
|2004|0|6|59|
|2005|0|6|59|

Source: Danish FSA The traffic light system was introduced in 2001. It requires pension institutions to report the impact on capital reserves and future pension obligations of two different market scenarios<sup>2</sup> . If the institution is not able to maintain the minimum required solvency under the moderate (red) scenario, it will get a red light from the FSA. Same mechanism applies to the extreme (yellow) scenario, and either the red or yellow light will result in further inspections by the FSA and an increase in capital may be required. If a pension institution is able to withstand both scenarios it gets a green light. Not only does the traffic light system incorporate market risk sensitivity into the solvency assessment, but it also looks at both sides of the balance sheet, where a lot of the problems arose during the perfect storm of 2001/2002 as illustrated by the large number of institutions in Red or Yellow light during those years (Table 8).

> 1 A discussion of the evolution of prudential regulation and risk-based supervision of pension institutions in Denmark is provided in Andersen and Skjodt (2006) and Van Dam and Brink Andersen (2006).

> 2 Red scenario: interest rate change of 0.7 percent, equity price fall of 12 percent, real estate price fall of 8 percent in addition to credit -, exchange rate - and counterpart – related losses. Yellow scenario: interest rate change of 1.0 percent, equity price fall of 30 percent, real estate price fall of

> 12 percent in addition to credit -, exchange rate - and counterpart – related losses.

11
_47_ _Biblography_ Trends in Private Sector Use in the 1980s. Presented at<sup>Population Association of America,</sup> Washington, D.C.

- Foreit, J. R., W. Rodrigues, J. M. Arruda, and J. Milare. 1983.<sup>A Cost-Effectiveness</sup> Comparison of Service Delivery Systems and Geographic Areas in<sup>Piauf State, Brazil. In Sirageldin, I.</sup> Salkever, D., and R. Osborn (eds.), _Evaluating Population_<sup>_Programs._London: Croom Helm.</sup>

- Foreit, K. G., D. Haustein, M. Winterhalter, and E. Ia Mata.<sup>1991. Costs and Benefits of</sup> Implementing Child Survival Services in a Private<sup>Mining Company in Peru.</sup><sup>_Journal of whe_</sup> _American Public Health Association,_ 81, 1055-1057.

- Foreit, K. G., D. Haustein, M. Winterhalter, and E. Ia<sup>Mata. 1991. Costs and Benefits of</sup> Implementing Family Planning Services in a Private Mining<sup>Company in Peru.</sup><sup>_Inwernatonal_</sup> _Family Planning Perspectives,_ 17, 91-95.

- Foreit, K. a. 1987. Integrating Family Planning into Group Medicine<sup>Practices: Legal, Health, and</sup> Economic Implications. Unpublished report.

- Foreit, K. G. 1990. Marketing Strategy for Commercial<sup>Sector Family Planning. Prepared for</sup> USAID/Peru.

- Foreit, K. G., 1. Galloway, C. Aramburu, and B. Lesevic. 1987. Business<sup>Analysis: Milpo Mining</sup> Company, Peur. TIPPS Project. Columbia, Md.:<sup>John Short and Associates.</sup>

- Foreit, K. G., M. P. P. de Castro, and E. F. D. Franco. 1989.<sup>The Impact of Mass Media</sup> Advertising on a Voluntary Sterilization Program in Brazil. _Studies_<sup>_in Fanily Planning,_20, 107-</sup> 116.

- Garilao, E. D. 1987. Indigenous NGOs as Strategic Institutions:<sup>Managing the Relationship with</sup> Government and Resource Agencies. _World Development,_<sup>_15_(Autumn Supplement), 113-120.</sup>

- Griffin, C. C., 1990. Health Financing in Asia. Prepared for Seminar<sup>on Health Sector Issues in</sup> Asia. Washington, D.C.: World Bank.

- Group Health Association of America. 1985. Managed Prepaid<sup>Health Care in Latin America and</sup> the Caribbean: A Critical Assessment. Prepared for A.I.D.,<sup>Health and Nutrition Division,</sup> Bureau for Latin America and the Caribbean.

- Hindarto, _G._ S., S. Sanie, A. H. Habsjah, N. Kak, and P. Richardson.<sup>1990. A Model for</sup> Employer. Finance Family Planning and Health Services. A Case<sup>Study of Atma Jaya Hospital,</sup> Jakarta. Final Report. Bethesda, Md.: University Research Corporation.

Honduran Ministry of Public Health. 1989. Epidemiology and<sup>Family Health Survey: Honduras</sup> 1987. With Association for Family Planning in Honduras<sup>(ASHONPLAFA), Management</sup> Sciences for Health, and Family Health International.

INE (Instituto Nacional de Estadisticas). 1986. _Encuesta_<sup>_Nacional de Nutricion y Salud, 1984:_</sup> _lqforne General._ Lima, Peru.
PRE Working Pager Series

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55. These controls were strengthened by the Fiscal Responsibility Law (FRL), approved in May 2000, and by the accompanying Lei de Crimes Fiscais (Law of Fiscal Crimes). The FRL consolidated many restrictions and regulations into a single unifying framework. The three main elements of the FRL are: (i) the explicit prohibition of debt refinancing operations between different levels of government, eliminating the moral hazard problem that led to the frequent federal government bailouts of the lower-level governments; (ii) the clear setting of limits on personnel costs, credit operations, loan guarantees and total debt, though the specific values were left to be determined by the Senate in separate resolutions; and (iii) the obligation imposed on governments to plan their finances based on annual budget targets.<sup>18</sup> 56. The results were immediate, and what is more important, permanent (Figure 13). The aggregate annual primary surplus of states and municipalities improved by 1.1 percent of GDP over e period 1999 to 2003. State and municipal debt stabilized despite the adverse macroeconomic environment characterized by low growth and exchange rate devaluation, factors that ordinarily have a negative impact on public debt ratios.

**Figure 13 Primary Fiscal Balance of States and Municipalities in Brazil 1996-2003 (in percent of GDP)**

<!-- Start of picture text -->
1.2<br>0.8<br>0.4<br>0.0<br>-0.4<br>-0.8<br>-1.2<br>96 97 98 99 00 01 02 03<br>Source:  Bacen<br><!-- End of picture text -->

18 Senate Resolutions 40 and 43 of December 2001which are complementary to the LRF stated that the ratio of personnel expenditure to net current revenue must be below 50 percent for the federal government, and below 60 percent for states and municipalities (with specific ceilings set individually for the Executive, Legislative and Judiciary branches). These Senate resolutions also imposed a ceiling for the ratio of debt to net current revenue of 2 for states and 1.2 for municipalities; a timeframe of 15 years was set for convergence to these limits. A comparison between the key constraints of Senate Resolution 78 of 1999 and the subsequent Resolutions 40 and 43 of 2001, for the states and municipalities shows that the restrictions imposed by Resolutions 40 and 43 are somewhat less stringent than those of the earlier Resolution 78 24
Policy Research Working Paper 8883

# **Abstract**

Improving the livelihoods of poor households and transitioning more women back to the labor force is a major challenge in South Asia. Self-employment promoted through women’s groups has often been cited as a promising intervention towards this end. However, the evidence on the impact of such programs on household income and labor outcomes is limited, especially for government programs like the National Rural Livelihoods Mission in India. This study aims to provide empirical evidence on the welfare impacts of an “intensive approach” adopted under this program. The data for the study come from 4,316 household surveys in 727 villages. The study uses matching methods with the population and socioeconomic census, as well as an instrumental variable approach to construct a retrospective control group. The analysis finds that the program has been able to achieve its primary objective of improving livelihoods by transitioning more women into work. The program has also expanded access to credit, increased the proportion of savings, and reduced interest rates on credit for rural households. This is the first study to estimate the annual income effects of a government-run rural livelihoods program in India, and it shows significant increases in median income across the sample. The results for 30th, 40th, and 75th percentiles are also large and significant. However, the study did not find significant average treatment effects for income. Contrary to previous studies, this study finds weaker impacts on assets, except for livestock.

This paper is a product of the Agriculture Global Practice. It is part of a larger effort by the World Bank to provide open access to its research and make a contribution to development policy discussions around the world. Policy Research Working Papers are also posted on the Web at http://www.worldbank.org/prwp. The authors may be contacted at agupta20@worldbank.org.

_The Policy Research Working Paper Series disseminates the findings of work in progress to encourage the exchange of ideas about development issues. An objective of the series is to get the findings out quickly, even if the presentations are less than fully polished. The papers carry the names of the authors and should be cited accordingly. The findings, interpretations, and conclusions expressed in this paper are entirely those of the authors. They do not necessarily represent the views of the International Bank for Reconstruction and Development/World Bank and its affiliated organizations, or those of the Executive Directors of the World Bank or the governments they represent._ Produced by the Research Support Team
government owned firms and 19% foreign owned firms. The regressions include dummies for whether the firm is an **exporter** , whether it produces **manufactured** goods, or is a **service** sector firm. The regressions also include the log of the number of **competitors** that each firm faces and the log of **sales** in USD as an indicator of size.

The regressions control for the strength of supervision and regulation and also include the private monitoring variable constructed by BCL and used by both BCL and BDL. The country level controls used are, as in BDL, growth of GDP (since firms in faster growing economies may face fewer obstacles), the inflation rate to proxy for market stability (firms in more stable markets face fewer obstacles, Boyd et al 2001), overall credit (overall financial development eases credit constraints). Overall corruption is a control as well.

The regression estimated is: _BC_ = α + β 1 _G_ + β 2 _F_ + β 3 _X_ + β 4 _M_ + β 5 _Serv_ + β 6 _Sales_ + β 7 _Comp_ + β 8 _Growth_ + β 9 _Inf_ + β 10 _PC_ +β 11sup _erpc_ + β 12 _PMpc_ + β 13 _T_ .

Even after the inclusion of all these variables, I expect to find that greater transparency reduces corruption in lending because more information enables both supervisors and private agents to monitor behavior of bank officials and portfolios. Better monitoring enhances accountability of officials since there is a greater chance that corruption or other wrongdoing would be exposed and punished by clients or others. Table A1b in the appendix shows the correlation among the main variables and Table 8 shows the summary statistics for the variables. Table 9 shows the ordered probit and binary IV probit regressions. Controls for supervisory power, and private monitoring are included.

27