Policymaking tools and measuring money-metric poverty - ESCWA
20-21 June 2022
Expert Group Meeting

Policymaking tools and measuring money-metric poverty

Location
  • Kempinski Hotel, Amman, Jordan
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This event is an opportunity to exchange knowledge and opinions on poverty-related modelling and simulation techniques and to discuss recent ESCWA technical reports and a forthcoming online estimation tool for policymakers. The aim is to improve these products and identify how to maximize their policy uses.

Monitoring the recovery from COVID-19 and progress toward the achievement of Sustainable Development Goal 1 on poverty eradication relies on methodologies for estimating and projecting poverty using appropriate poverty lines. Precise forecasts are important as they allow member States to improve their planning and resource allocation to reduce poverty.

Outcome document

The EGM provided a platform for presenting latest simulation, methodologies and tools developed by ESCWA related to poverty and discussing them with leading global and regional experts.

Key recommendations:

  1. The methodologies and tools presented can actively support ESCWA’s Regular Programme for Technical Cooperation with member States, most notably the work on income poverty.
  2. There is a need to establish channels for future coordination and technical collaboration among potential partners/ institutions. Such collaboration can lead to a flagship report to identify key challenges and opportunities to ending extreme poverty. It could also serve as a progress report for SDG 1.

Mr. Hassan Hamie from ESCWA presented the study that aims to showcase the recently developed methodology for estimating the ratio of macroeconomic growth forecasts derived from national accounts to household level income captured by surveys.

 

The results showed that in the best-case full growth passthrough scenario, modest poverty reduction was recorded but the world was still unlikely to reach SDG1 targets 1.1 and 1.2 by 2030.

 

The presentation was followed by a 30-minutes discussion. The discussants for that session were Massoud Karshenas and Heba El-Laithy. Additional comments were also received by the participants both online and onsite.

Mr. Khalid Abu-Ismail from ESCWA presented the newly developed methodology to compute the poverty line in a way that way that produces poverty measures that maintain comparability across countries and over time and is consistent with behavioral tendencies of households as modeled by classical economic theory.

 

The main finding is that global poverty

rates using APL are higher for upper-middle income countries, on account of the higher poverty lines it assigns. However, the potential for registering poverty reduction is considerably higher using the APL, as the poverty lines rise at a decreasing rate with rising income, notably so relative to the SPL for the vast majority of developed countries worldwide.

 

The presentation was followed by a 30-minutes discussion. The discussants for that session were Imane Helmy and Heba El-Laithy. Additional comments were also received by the participants both online and onsite.

Mr. Vladimir Hlasny from ESCWA presented the early-stage methods and findings of the ongoing work on inequality. The aim of presenting the incomplete work, is to have an open-ended discussion regarding the next directions of such work.

 

Once complete, ESCWA would hope to have answers to such questions: Is inequality expected to change over the next ten years? In which direction, by how much, and at what rate across individual years? What is the relevant metric to study inequality, using what data? What are the implications for middle- and low-income households, and their classification as poor?

 

Four different functional forms of inequality in household income and expenditure distribution changes were presented.

 

The presentation was followed by a 30-minutes discussion. The discussants for that session were Carlso Gradin, Paul Makdissi and Xavier Mancero. Additional comments were also received by the participants both online and onsite.

Mr. Hassan Hamie from ESCWA presented the latest version of the money-metric tool, its comparison to the existing platforms (PovCal, PIP, ADePT, etc.) and illustrated the various functions and potential use.

 

The presentation was followed by a 30-minutes discussion. The discussants for that session were Reham Rizk, Mustafa Yagci and Jawad Al-Saleh. Additional comments were also received by the participants both online and onsite.

 

The audience, the presenter and ESCWA staff have exchanged ideas, related to the following: Usability for Arab policymakers including Visuals and design, Access modalities, Saving/exporting results, Manuals, Training, Technical/validation reports, Ease of use, User experience, Advanced analytics, Validity/consistency of results, Upload of user data and specifications, Navigation within tool, Adaptability, Consistency/interaction with other platforms.

 

Additionally, the innovative MPI optimization model was presented. The model aims to estimate the optimal fiscal budget allocation aimed to reduce the MPI in a certain year (in the near future).

The limitations of the model and the possible future extensions of the work were also discussed.

This session was led by Mr. Khalid Abu-Ismail, in which he introduced the idea of having a global/ regional poverty report.  The aim of the document is to identify key challenges and opportunities to ending poverty and boosting shared prosperity. It could also serve as a high-level progress report for poverty SDG indicators.

 

The session was followed by a 20-minutes discussion.

After this session Ms Mona Al Rfou, representing the Arab centre for social policy and poverty reduction and Mr. Tarek Nabulsi, representing the League of Arab States, concluded the event and discussed the importance and relevance of such work to the League of Arab States.


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