**<mark>Monetary transfers</mark>**

Monetary transfers are captured directly from the survey. They refer to pensions (without separating between contributory and non-contributory), unemployment and maternity benefits, Child Money program, student benefits and several other benefits. The food stamps program, a small but only means-tested program in Mongolia, is not included in the survey. These monetary transfers are classified into three groups: pensions, Child money program and social welfare benefits. No assumptions or computations are made about these. Selection of beneficiaries and amount of benefit received is taken directly from the survey.

# **<mark>In‐kind transfers</mark>**

Education expenditures are allocated to a given household based on the presence of school-aged children attending public school and official education expenditure per aimag. Education expenditures at the aimag level are available for Pre-School and Basic education (which includes both Primary and Secondary). Annual pre-school expenditure per child varies from 1,587,000 MNT in UB to 2,381,000 MNT in Dundgovi. Expenditures per student at the primary and secondary level are less than expenditures for pre-school, ranging from MNT 687,000 in UB to 1,529,000 in Govi-Altai. Tertiary education expenditures are not available at the aimag level, the national average expenditure on tertiary education per student is 3,537,140 MNT.<sup>17</sup> Attendance in pre-school is not captured in the HSES, since these children are too young, thus an attendance rate at the aimag level is assumed, about one-third. By aimag, a random sample of preschool aged children are selected to receive in-kind education. For primary, secondary, and tertiary students, attendance is based on responses in the HSES.

Finally, if a household indicated they used public health services in the HSES, an in-kind health transfer is applied. The amount of the annual transfer per household is 1,655,041.8 MNT, based on total expenditures in public health divided by number of patients as per HSES.<sup>18</sup> In the case of public health and education the monetary value of transfers in kind has been scaleddown. This is because household surveys usually capture a level of consumption that is lower than household consumption in national accounts. In the case of Mongolia, for instance, public expenditures in education represent 8.2 percent of consumption expenditures as per aggregate fiscal and national accounts. But they would represent 13.5 percent if compared to consumption reported in the HSES survey. Without scaling down, transfers in-kind would have a disproportionately larger impact upon distribution of well-being as per survey data than they represent in aggregate data.<sup>19</sup>

> 17 Data on education expenditures by level of education and Aimag provided by ministry of Finance on December 2017. Data on students enrolled in each level of education and by Aimag, from 2016 Mongolia Statistical Yearbook. 18 HSES questions 3.10 and 3.11 indicate whether a household member consulted a health facility/provider, and whether it was a public or private service. Health expenditures by Aimag provided by Ministry of Finance on December 2017.

19 For more on the advantages and disadvantages of re-scaling in-kind transfers see (Lustig N. , 2017). MONGOLIA Distributional impact of taxes and transfers / May 2018 10