Conference Paper
Informing Policies Amid Multidimensional Poverty Changes: Impact Simulation and Poverty-Reduction Optimization
No.
ERF30_143
Publisher
ERF
Date
March, 2024
The Arab region continues to suffer from tragedies of recurring conflicts and crises, characterized by socioeconomic shocks including negative growth, state budget deficits, rise in welfare inequality along various dimensions, and shrinking economy and welfare state. Living standards of various socioeconomic classes are held back along multiple dimensions. Without adequate measurement, policies used to alleviate the problem may lead the society off course, as the efforts implemented by policymakers may involve poor targeting, and misdirection or over/under-allocation of scarce resources. Recognizing the significance of measuring poverty in the Arab region, and the imperative to continuously monitor progress towards sustainable development goals—specifically Target 1, I introduce the application of several optimization models to five Arab countries (Algeria, Egypt, Iraq, Mauritania, Tunisia). Outlined in this manuscript are various models of state intervention, covering its capacity to allocate resources and, crucially, policymakers' proficiency in transferring these resources to the households that require them the most. An evaluation of the model's performance against observed changes is conducted. For each country, the model is implemented, spanning the period between two observed survey years, with the first observed survey serving as the baseline year and the poverty reduction target set to be achieved in the second observed year. While recognizing that observed poverty measures in the second observed year for all countries may not necessarily result from sound policy options applied during the inter-survey period, the model results indicate a consistent focus on targeting the age schooling gap, school attendance, mobility assets, and overcrowding indicators across all countries, suggesting a persistent emphasis. In contrast to observed changes, the model suggests that the most efficient way to reduce multidimensional poverty does not require targeting all indicators. This manuscript concludes that policymakers in Arab middle-income countries should prioritize directing their resource allocation schemes toward the education sector to achieve SDG target 1.2 most efficiently by the year 2030. Conversely, policymakers in Mauritania, as a low-income country, should address all indicators within the education, housing, and access to services sectors.
Speakers
Hassan Hamie
Economist, Poverty and Inequality Research Team, UN...
Authors
Jinane Jouni
Economic Researcher, UN-ESCWA
Authors
Vladimir Hlasny
Economic Affairs Officer, UN Economic and Social...
Policy Affiliates
Khalid Abu-Ismail
Senior Economist, United Nations Economic and Social...