Candidate tools

Progress out of Poverty Index (PPI)

• Developed by Grameen Foundation in partnership with an economist, Mark Schreiner

• Source data are national household expenditure and/or income surveys.

Wealth Index (WI)• Index developed by social

franchising MWG members• Source data are DHS surveys

Tool Format

PPI• Can serve as a survey

supplement or standalone measure

• 10 asset, household, education, and employment questions

• Output: absolute measure -- likelihood that a client’s household is below the World Bank’s $1.25/day poverty line

Wealth Index• Can serve as a survey

supplement or standalone measure

• 20 mostly asset questions (with 3 and household indicators)

• Output: relative measure – wealth quintiles and a client’s place on that distribution

Tool FormatPPI

• Can serve as a survey supplement or standalone measure

• 10 questions: assets, household, education, and employment Output: absolute measure -- likelihood that a client’s household is below the World Bank’s $1.25/day poverty line

Wealth Index

• Can serve as a survey supplement or standalone measure

• 20 questions: mostly assets along with 3 household indicators

• Output: relative measure – wealth quintiles and a client’s place on that distribution

Metrics WG Criteria for Equity Measure (from Nov, 2011 Watamu Meeting)

• Agreed upon between organizations– If we choose a particular measure, are all social franchising organizations actually going to use it? How

likely is alignment across organizations?• Comparable to national context

– Does this measure help us determine who is poor within a certain country?• Comparable across countries

– Does this measure help us determine who is poor on a global scale?• Meets definition of poverty: “we can tell who is poor”

– Do the measures validly determine poverty status?• Comparable across services

– Social franchises span a broad spectrum of health services – will the measure be consistently useful across service areas?

• Donors/government care– Will the measure provide useful data to make meaningful statements to donors and government

policymakers?• Simple and easy to collect

– Will providers of any level be able to collect this information?• Routine

– Will the data collection process for the measure dovetail with existing surveillance mechanisms (e.g. an annual exit interview)?

Criterion: Agreed upon between organizations

PPI

• Because of associated costs, it is possible that some organizations may not be able to use PPI

• Development costs are significant with PPI (more on this later)

Wealth Index

• WI was developed by the SF MWG – a collaboration between implementers, donors, and research groups

• Relatively inexpensive to adopt, implement, and analyze

Criterion: Comparable to national context

PPI

• Though PPI yields an absolute measure of poverty, national context for an individual or group’s poverty status can be derived by examining PPI source data (e.g. Kenya Integrated Household Budget Survey)

• For example, source data can inform a program manager that nat’l poverty is 25% and program clientele are only 15%

Wealth Index

• All WI wealth quintiles are based on national data (source: DHS surveys) and are thus comparable to national context.

Criterion: Comparable across countriesPPI

• PPI uses the World Bank’s global poverty treshold of $1.25/day (based on 2005 PPP) – extremely comparable across countries

• The source data for PPI are the most recent expenditure surveys – these are not standardized globally and thus available comparison indicators may vary

Wealth Index

• As WI creates relative measures within a country, there are challenges to directly comparing across countries

• Being in the poorest quintile may not mean the same in Country X as in Country Y (the poorest quintile could be richer than the richest of another country), nor does owning a bicycle mean the same thing everywhere.

• However, because the source DHS surveys contain standardized questions across countries, there is opportunity to compare across countries.

Criterion: Meets definition of poverty: we can tell who is poor

PPI

• PPI excellent at generating an individual or group’s likelihood of living below the $1.25 poverty line

• Our pilots confirmed PPI’s ability to estimate poverty status

• Subgroup stratification is limited by available indicators in source data – if an expenditure survey lacks specific questions on, say, family planning users, then PPI would not be able to stratify by that subgroup

Wealth Index

• WI excellent at generating nationally representative wealth quintiles and placing individuals within that distribution.

• Our pilots confirmed WI’s ability to estimate poverty through wealth quintiles

• Because of the diversity of health-related indicators in DHS surveys, relevant subgroup stratification is much easier with WI (e.g., creating a distribution of rural family planning users and comparing a franchise’s clientele to that distribution)

Criterion: Comparable across servicesPPI

• PPI is useful across all services• Our pilots and MSI’s field

experiences confirmed PPI’s viability across a number of health services

• *source data and health• However, it is worth noting that

service-specific subgroup stratification is more difficult if the desired indicators are not present in the source data – expenditure surveys sometimes lack the health-related breadth of DHS surveys

Wealth Index

• WI is useful across all services

• Our pilots confirmed WI’s viability across a number of health services

• *source data and health• DHS surveys contain

questions on a variety of health service questions – allowing for useful cross-service subgroup analysis

Criterion: Donors/government carePPI

• PPI’s results are a simple, elegant, and powerful way to report the poverty status of a program’s clientele

• Percent of client’s below/above poverty line has resonance with donors, policymakers, and laypersons

Wealth Index

• Wealth quintiles have been validated for decades, have hundreds of peer-reviewed publications, and are commonly used in health policy

• Wealth quintiles can be a more complex concept to explain to donors and government policymakers – especially as they lack the power of a universally global measure (i.e. $1.25/day)

• If you say “poorest quintile,” the meaning is not as instantly accessible as, “living below a universal poverty threshold”

Criterion: Simple and easy to collectPPI

• PPI’s 10 questions can be added to any exit or client interview or stand alone

• Any provider, with minimal training, can administer the PPI questions

• Field reports from our pilots state little-to-no difficulty in implementing PPI

• Anyone with a pencil and paper can calculate a poverty score for an individual – creates more agency for both providers and regional managers

Wealth Index

• WI’s 20 questions can be added to any exit or client interview or stand alone

• Any provider, with minimal training, can administer the WI questions

• Field reports from our pilots state that WI added approximately 10 minutes to each interview, slightly more time than PPI added

• Technical, statistical capabilities necessary to conduct analysis on WI data

Criterion: RoutinePPI

• Our pilots and MSI’s field experiences demonstrated that PPI can be incorporated easily into existing data collection mechanisms – provided a PPI has been developed for the desired country

Wealth Index

• Our pilots demonstrated that WI can be incorporated easily into existing data collection mechanisms

Current Global Availability/CoveragePPI

• PPI currently available in 45 countries with 2-3 more under development

• Of the 35 active social franchising countries, only 24 currently have PPI scorecards

• Of the 70 low- and middle- countries where MSI, PSI, and DKT report operations, 26 currently lack PPI scorecards

Wealth Index

• DHS data available for over 90 countries

• For the 70 low- and middle- income countries where MSI, PSI, and DKT report operations, 11 currently lack DHS data

Development costs for every countryPPI

• PPI costs between $20,000-25,000 (USD) per country

• ~$10,000-15,000 goes to data collection, field testing, and program overhead

• ~$10,000 goes to Mark Schreiner’s group for analysis and development

• Cost sharing is possible on the data collection/field testing portion, but not the analysis portion

Wealth Index

• From our WI pilots we confirmed it took 8 hours of a technical expert’s time per country

• Labor cost for 8 hours of a technical expert is ~$400 (USD)

Cost ProjectionsPPI

• To expand PPI coverage to meet only social franchising organizations (12 additional countries), initial investment would be approximately $240,000 (USD).

• To expand coverage to all MSI/DKT/PSI countries (26 additional), investment would be approximately $520,000

• Assuming 5-year updates for every country, with an eventual 50% cost sharing model, annual update costs for all MSI/PSI/DKT countries (70) would be approximately $140,000

Wealth Index

• From our WI pilots we confirmed it took 8 hours of a technical expert’s time per country

• Labor cost for 8 hours of a technical expert is ~$450 (USD)

• To expand coverage and create .do files for all MSI/DKT/PSI countries, initial investment would be ~$31,500

• Assuming 5-year updates, with an expected 25% reduction in staff hours as experience increases, annual update costs for all MSI/PSI/DKT countries would be approximately $4,800.

Things to considerPPI

• Are the development and update costs of PPI insurmountable obstacles to its widespread adoption?

• Is the power of the comprehensible manner in which PPI reports poverty status worth the cost?

• How important is the limitation in subgroup stratification – many health-relevant indicators are missing from expenditure surveys

• Where will the funding come from to create PPIs to cover our member and partner organizations?

Wealth Index

• How important is lack of global context for WI’s usefulness?

• What happens if DHS stops administering surveys in a particular country?

• Only those with advanced statistical capacity could conduct WI analysis -- providers would only be feeding data, not necessarily using it

• Workarounds more easily available for non-DHS countries – similar questions available in malaria and AIDS indicator surveys, among others