Harmonize or Perish! The Living Standards Measurement Study
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Harmonize or Perish!The Living Standards Measurement Study
Gero CarlettoDevelopment Research Group
WORLD BANK GOALSJim Yong Kim announces new goals End extreme poverty: the percentage of people living with
less than US$ 1.25 a day to fall to 3 percent by 2030
Promote shared prosperity: foster income growth of the bottom 40 percent of the population in every country
Recognition of large data gap75 percent of countries with “updated” household survey
WB GOALS,IMPLICATIONS Some key current data gaps:
Household income or consumption distribution data is up-to-date in about 50% of developing countries
The stated goal: halve the poverty data gaps in developing countries by 2017, ensuring up-to-date data for 75% of all countries (containing virtually all the poor)
WB GOALS & LSMSMore data, but just as important …quality datapolicy-relevant datacomparable data
cross-country and over timeNot only averages, but distributions (shared prosperity)
Comparability of existing consumption data …
Less than one week One week Two weeks One month Greater than one month
Less than or equal to two weeks
0102030405060708090
100
41.0
24.0
5.0 7.0
23.0
70.0
Percent
Reference period
Source: “Assessment of the reliability and relevance of food data …”, Smith et al.
Food purchases Home-produced food consumed In-kind receipts of food All three sources0
102030405060708090
100100.0 96.0
86.0 85.0
Percent
Mode of acquisition
Instrument design & implicationsfor poverty
Beegle, Kathleen, Joachim De Weerdt, Jed Friedman, and John Gibson. 2012. “Methods of Household Consumption Measurement through Surveys: Experimental Results from Tanzania.” J of Development Economics 98: 3-18
Type of consumption module in questionnaire
Mean consumption per cap (Tsh)
Poverty headcount
($1.25/day) Long 7 day recall 520,850 54.9
HH diary infrequent 425,298 55.6
Personal diary 510,616 47.5 Note: Test compared 8 different instruments, varying recall period and method
Heterogeneity in Surveys
• Initial purpose of the survey drives the way survey is designed and implemented
– Different agenda Different instrument
• An increasingly crowded field…
Instrument Sponsor
Censuses UNFPA
Income Expenditure /Budget Surveys (IES/HBS) Central Banks, IMF, NSOs
Labor Force Surveys (LFS) ILO
Demographic and Health Surveys (DHS) USAID
Multiple Indicator Cluster Surveys (MICS) UNICEF
Core Welfare Indicator Questionnaires (CWIQ) UNDP, DfIDWB Africa Reg.
Welfare Monitoring Survey (WMS) Stat Norway
Statistics on Income and Living Conditions (SILC) Eurostat
Comprehensive Food Security and Vulnerability Analysis 9CFSVA)
WFP
Integrated, Multi-Topic Surveys[Living Standards MeasurementStudy (LSMS), Integrated Surveys (IS), Family Life Surveys (FLS)]
World BankRANDNSOs
• The “McNamara Anecdote”• Need to understand living standards, poverty,
inequality and the correlates and determinants of these- not just monitor.
• Unit of analysis is the household, as both a consuming and producing unit
• One survey collecting data on a range of topics is a more powerful tool for policy formulation than a series of single purpose surveys: the sum is greater than the parts– Farmers are diversified– Poverty and FS are multidimensional
The thinking behind the LSMS survey
The thinking behind the LSMS survey (cont’d)
• Demand driven and country-owned• Priority often given to meeting the policy needs of
each country, but with an eye to x-country comparability and accepted standards
• Implications– no standard set of LSMS questionnaires: content, length
and complexity varies by country– Questionnaire development- lengthy process linking data
users, stakeholders and data producers – Capacity building, sustainability
A “typical” LSMS• Consumption-based welfare measure
– Multi-dimensional poverty• Multiple instruments
– HH, Agriculture, Community, Price, Facilities• Strict data quality control
– “Intelligent” data entry, CAPI– Small sample– Pre-coded, closed-ended questions– Training, supervision
• Documentation and Dissemination– Basic Information Document– Consumption aggregate .do files– Publicly available microdata
The LSMS today• Goal: ensure that the LSMS meets new demands for
data and remains at the forefront of survey methodology
• New demand -- new topics• Old topics with new focus (agriculture)• New technologies • Increased standardization• Four areas of focus
– Data collection– Methodological Work– Tools, Resources for researchers/survey practitioners– Training and Dissemination
DATA RESEARCH
AG POVERTY/FS OTHER
SURVEY METHODS ANALYSIS
*Gender*AgNut*Facts+Myths*Migration*Subsidies*Tracking poverty
LSMS-ISATanzaniaUgandaEthiopiaMalawiNigeriaNigerMaliBurkina Faso
Non-LSMS-ISASerbiaHaitiTajikistan …
ADVOCACY/DISSEMINATION
LSMS
OUTREACH
Training (LSMS course, e-learning)
Survey Clinics
Sourcebooks
Technical Assistance
Tools(CLSP, ADePT)
LandSoilInputsSkillsCropsLvstck
*Mig*Labor*Income*Credit
SHWALITASubj. Pov.
Lack of standards result in poor comparability!• Take Food Consumption …
– Diary vs. recall– Household vs. individual– Reference period– Nomenclature (COICOP)– Bulk purchases– Non-standard units of measure– Food consumed away from home (FCAH)– Valuation of consumed own-production
Take diary vs. recall …• Diary often considered ….
– Unfeasible (low literacy rate)– Too onerous for respondents– Too costly– Often, diary converts into short (2-3 day) recall … but no metadata!
• Recall considered imprecise (telescoping, recall bias)• 7-day recall most frequent. Most feasible?
Can we improve on 7-day recall?• Creating a continuum between diary and
recall: “SHWALITA, the sequel”• Bounding reference period• Assisting households to recall• Accounting for bulk purchases (annualization)
Can we improve on 7-day recall?• Creating a continuum between diary and
recall: “SHWALITA, the sequel”• Bounding reference period• Assisting households to recall• Accounting for bulk purchases (annualization)• Food Consumed Away from Home
– Increasing share of total food consumption
Can we improve on 7-day recall?• Creating a continuum between diary and
recall: “SHWALITA, the sequel”• Bounding reference period• Assisting households to recall• Accounting for bulk purchases (annualization)• Food Consumed Away from Home
– Increasing share of total food consumption• Non-standard Units of Measure (CAPI)
20
Non-Standard Units
What about non-food?
• Lack of consistency even in number of components– Imputed rents– User value of durables– Health expenditures– List of 12-month items
What about income?
“The practical and conceptual difficulties of collecting good income data are severe enough to raise doubts about the value of trying”
A. Deaton (1997), p. 30
Income and Consumption• Income (Y) information important for other uses
(besides poverty & inequality)– Livelihood strategies (income shares)– Productivity/efficiency analysis– Net buyer/net sellers, impact of high food prices
• Consumption (C) preferred welfare measure in developing countries– More stable (short-term fluctuations)– Income harder to measure (self-employment)– Less incentive to mis-report
• Y relatively neglected• Some components more troubling than others!
A closer look at Y componentsWage earners
A closer look at Y components (cont’d)
Farm households
Measuring crop production
Measuring crop production• Farmers/HHs don’t keep records• Crops often harvested in small quantities over several months• Mostly consumed• Recall widely used but does not always work• Measured in non-standard units of varying size• Different units along the value chain, different states• Standards do not exist or not feasible
– Need validation
#whatwillittake … to harmonize?• Friction bet/w country ownership/temporal
comparability and x-country harmonization?• Not a DHS but more standardization is possible• Start with inventory of surveys (Olivier)• Mapping and influencing “pipeline”• Agreement on current standards
– Consumption vs. Income– Food consumption
• Method• Reference period• Disaggregation• Nomenclature (COICOP)
– Non-food expenditure components– Imputations
#whatwillittake … to harmonize?
• Enhanced coordination– Some “unflattering” examples …– Clearly defined mandates and responsibilities– Establish forum (IHSN, UNSC,…)
• Methodological research to establish future, improved standards
“If you want to make enemies, try to change
something” Woodrow Wilson
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