covered and the indicators used are as follows: MDG 1 (halve the population share in poverty) – the headcount poverty rate (using the national poverty line);<sup>4</sup> MDG 2 (achieve universal primary education) – the net primary completion rate; MDG 4 (reduce child mortality) – the under-five mortality rate; MDG 5 (improve maternal health) – the maternal mortality rate; MDG 7 (ensure environmental sustainability) – two indicators: the population shares with access to (a) an improved water source and (b) improved sanitation.

These different MDGs are covered in an additional set of functions that link the level of each MDG indicator to a set of determinants (Table 1). For MDG 1, we compute the population share below the poverty line (which is adjusted for CPI changes) on the basis of per-capita household consumption, assuming that it follows a log-normal distribution. For MDGs 4, 5, 7a and 7b, the determinants include relevant services per capita (in health, and water-sanitation), household welfare (measured by household consumption per capita), the level of public infrastructure, and other MDG indicators; i.e. the formulation allows for the presence of synergies between MDGs. This is a key characteristic of MAMS. An improvement in the access to clean water and sanitation e.g. benefits the health of the population, thereby reducing child and maternal mortality while an improvement in the health of the young (proxied by reduced child mortality) in turn affects education outcomes positively. Government spending on different sectors should therefore not be considered as separate efforts.

In education, which is treated differently from other MDGs, the model tracks base-year stocks of students and new entrants through the three cycles. Annual student performance is indicated by whether the enrolled students in each grade successfully complete their grade and continue to the next, repeat it, or drop out; the share of the first primary year cohort that enrolls (the net intake rate); and the shares among primary and secondary level (or cycle) graduates that continue to the next level. At each level, educational services per student are viewed as the indicator of educational quality. Student performance indicators depend on educational quality, household welfare, the level of public infrastructure, wage incentives (expressed as the ratio between the wages for labor at the next higher and current levels of education for the student in question; an indicator of payoff from continued education), and health status (proxied by MDG 4). MDG 2 (the net primary completion rate) is computed as the product of the primary net intake and passing rates for the series of past years relevant to the student cohort that is due to graduate in the current year.<sup>5</sup>

**Table 1:** Determinants of MDG achievements in MAMS

|||<br>|Other determin<br>|ants<br>||
|---|---|---|---|---|---|
|MDG|Per-capita real<br>service delivery|Per-capita household<br>consumption|Wage<br>incentives|Public<br>infrastructure|Other<br>MDGs|
|1 – Poverty||||||
|2 – Primaryeducation|||||4|
|4 – Infant mortality|||||7a,7b|
|5 – Maternal mortality|||||7a,7b|
|7a – Access to water||||||
|7b – Access to sanitation||||||

4 Given the assumption of a fixed log-normal distribution, the poverty results assume that the gains in per-capita household consumption are distributed neutrally (including an unchanging value for the Gini coefficient). 5 For example, for a six-year primary cycle (like Rwanda’s), MDG 2 (the net primary completion rate) in 2008 is defined as the product of seven terms: the net intake rate in 2003 and the passing rates in 2003-2008 as the students move from grade 1 to grade 7. If the value is 1 for each term, the net primary completion rate is also one. However, a moderate short fall has a large impact on the MDG 2 value, for example, 0.95<sup>7</sup> is 0.70.

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