preliminary results from the poverty analysis in...

Preliminary results from the poverty analysis in Namibia

Sebastian LevineUNDP Senior Economist

Workshop on Macro-Economic Analysis and Programming in Support of MDG-Based Planning in AfricaLusaka, Zambia

29 October – 2 November 2007

Overview

• Elements of poverty analysis• Key principles and goals• Definitions and methodology• Levels and trends in poverty and inequality• Drivers of poverty changes• Key messages

Elements of poverty analysis

2007/8People Security Survey, Participatory PovertyAssessments, MDG Report (II)

Other analyses

2007/8Papers and policy briefs: Income, nutrition, HIV/AIDS,social grants, assets, remoteness, SAM

Further analysis on NHIES dataset

2007CBS technical income poverty/inequality reportFull poverty analysis

2007Background Paper and NHDRCapability approach

2007“Q-squared” Working Paper and conference (Cornell/Toronto)

“Combined” analysis

2006NHIES 2003/3004 preliminary and final survey report;Op-ed in The Namibian

Income poverty

2006Discussion Paper with CBS, UNAM and HSRCon 1993/94 NHIES; article in African Statistical Journal

Initial poverty line analysis

2004/5MDG Report and Common Country Assessment Review of data sources

TimingPublicationType of analysis

Key principles and goals

• National ownership to ensure buy-in, relevance and impact• Capacity building for sustainability• Reliance on official data and Central Bureau of Statistics • Maintaining technical rigor and independence of analysis• Confidentiality and data access• Stimulate “a great poverty debate” in Namibia and provide

practical policy guidance• Feed back lessons into planning for National Statistical

System

Definitions and methodology

• Consumption versus income• Setting an income poverty line; regional baskets, prices,

household composition and size• Informal and formal sector; households and labour market• Poverty analysis using poor data; changes in methodology• Timing of surveys and data collection• Analytical lenses: 1) Monetary, 2) Capability, 3) Social

Wage, 4) Assets, 5) Social Exclusion• “Q-Squared” approaches; complementary rather than

competing methods

Trends in income poverty

Sources: Central Bureau of Statistics (2006)Note: Poor is defined as spending 60 % or more of total income on food.

0%

10%

20%

30%

40%

50%

1993/1994 2003/2004 2015

Poor households

Poor individuals

Logistic regression

0.0000.016-1.093Salary as main source of income0.0000.021-0.179Pension as main source of income0.0000.1200.762Female head of household

R Squared: 0.270

0.0000.0950.618Elderly head of household0.0000.0010.027Household size0.0000.013-1.832Urban0.0000.074-1.485Constant

Sig.S.E.B

Source: Calculated from NHIES 2003/2004 data

Expenditure ratios 93/94-03/04

0.0

1.0

2.0

3.0

4.0

5.0

10 20 30 40 50 60 70 80 90Deciles

Rat

io

Total expenditure

Food expenditure

Food CPI

Source: Calculated from NHIES 1993/1994 and 2003/2004 data

Lorenz curves

0

10

20

30

40

50

60

70

80

90

100

0 10 20 30 40 50 60 70 80 90 100

relative rank (/%)

cum

ulat

ive

perc

enta

ge o

f tot

al in

com

e

1994/95

1986/87

perfectequality

perfect equality

2003/2004

1993/1994


Gini-coefficients

0.7220.809Households

0.7080.727Deciles

Households

0.6040.713Individuals

0.5900.701Deciles

Individuals2003/20041993/1994


Annual per capita income by main source

2.9103583608Total Namibia1.9166078889Business

2.5154876080Wages in cash

3.157041865Pensions

3.361161846Cash remittances

3.443701280Subsistence farming

Ratio of 2003/2004 to

1993/94

2003/2004 (N$)

1993/1994 (N$)

Source: Central Bureau of Statistics (1996; 2006) and own calculations

Growth incidence curves


0

1

2

3

4

5

10 20 30 40 50 60 70 80 90 100

Per capita household expenditure decile

Fact

or in

com

e gr

owth

CapriviOhangwenaOmahekeNamibia

Annual GDP and GDP per capita growth

-6%

-4%

-2%

0%

2%

4%

6%

8%

10%

80 81 82 83 84 85 86 87 88 89 90 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05

GDPGDP per capLinear (GDP per cap)

Sources: Central Bureau of Statistics (2006)

Accounting for growth:

2.31.50.84.72001-20050.61.11.93.51996-2000

2.40.52.25.01991-1995

-1.90.14.42.61986-1990

-2.10.31.6-0.21981-1985

TFP*(A)

Capital (K)

Labour (L)

Contributions (in %-points)Annual GDP growth in %

(Y)

Note: α =0.35; * TFP is Total Factor ProductivitySources: Central Bureau of Statistics (1996; 2006), World Development Indicators and own calculations

α1LαAKY −=

Employment intensity of production

-0.391036,181368,46220040.521823,690417,4862000

2116,751354,0951997

Jobs per N$ 1 million in GDP

GDP in N$ million

( )

Adjusted Employment

( )

Sources: Ministry of Labour (2006; 2002; 2001) and own calculations

÷÷

=1÷

1÷

ttt

tttt Y/)YY(

E/)EE(ε

tYtE

Capability Poverty and the HPI

0

10

20

30

40

50

2001 1991 2001 1991 2003/04 1993/94 HPI 2001-2004

HPI 1991-1994

Probability at birth of notsurviving to age 40

Adult iliteracy rate Share of population inhouseholds that spendmore than 60% of total

income on food

Human Poverty Index

perc

ent

Source: UNDP Namibia (2007)

Growth incidence: Assets

2211Access22266078Owns

Poultry


Cattle


In % Field for crops

2003/20041993/19942003/20041993/1994

Wealthiest 20 %Poorest 20 %

Sources: Levine and Roberts (2007)

Growth incidence: “Social Wage”

8118382Bush0121Bucket5579Pit Latrine

878377Flush toiletSanitation facility

121014River, canal, lake493635Public pipe

119119Piped on site807432Piped in dwelling

In %Main water source

2003/20041993/19942003/20041993/1994Wealthiest 20 %Poorest 20 %

Source: Levine and Roberts (2007)

Social Exclusion: HDI by language groups

0.000 0.250 0.500 0.750 1.000

Khoisan

Rukavango

Caprivi languages

Nama/Damara

Oshiwambo

Namibia

Otjiherero

Setswana

Afrikaans

English

German

Life Expectancy Index

Education Index

Income Index

Source: UNDP Namibia (2007)

Key messagesHas growth been pro-poor in Namibia?• Incomes of poor have risen; “pro-poor” (Ravallion 2004) • Incomes of poor have risen disproportionately compared

to the non-poor; “pro-poor” (Kakwani et al 2004)• Incomes of the poorest have risen due to social grants,

remitted incomes; “indirect pro-poor growth” (Klasen 2003)• Additional factors: subsistence agriculture and northern

regions; “direct pro-poor growth”• Definitions matter: broader measures of poverty and

inequality are deteriorating; development process has not been “pro-human poverty” – HIV/AIDS, assets, social wage, exclusion

Key messages (cont)Pro-poor policy challenges• Mounting pressures on the revenue side likely to

compromise the ability to sustain social transfers and public sector employment; creating fiscal space

• Public sector reform to increase efficiency and mitigate challenges to service delivery; HIV/AIDS, remoteness, MDG scale-up

• Job creation essential for long-term poverty reduction; promote non-mineral tradeables (competitive exchange rate, stemming capital flight, human capital and labourmarket reforms)

ReferencesCentral Bureau of Statistics (CBS). 2006a. “2003/2004 Namibia Household Income Expenditure Survey,”

Windhoek: GRN, National Planning Commission.CBS. 2006b. “National Accounts 1995-2005,” Windhoek: GRN, National Planning Commission.CBS. 2003. “Population and Housing Census 2001,” Windhoek: GRN, National Planning Commission.CBS. 1996a. “Living conditions in Namibia 1993/1994: Economic and Social Indicators from the Namibian

Household Income and Expenditure Survey,” Windhoek: GRN, National Planning Commission. Government of the Republic of Namibia. 2001. “Second National Development Plan, 2001-2006,” Windhoek:

GRN, National Planning Commission.Kakwani, Khamdker and Son, “Pro-poor growth: concepts and measurements with country case studies”, IPC

Working Paper 1, August 2004.Klasen, S. (2003): ‘In Search of the Holy Grail. How to Achieve Pro-poor Growth?’, in B. Tungodden and N.

Stern (eds), Towards Pro-poor Policies: Proceedings from the ABCDE Europe. Washington, DC: World Bank.

Levine, S. 2006. “Measuring Progress Towards Global Poverty Goals: Lessons and Challenges from Southern Africa,” African Statistical Journal, Vol 3, November.

Levine, S and Roberts, B. 2007. “A Q-Squared Approach to Pro-poor Policy Formulation in Namibia,” Q-Squared Working Paper No.49, November 2007, University of Toronto.

Ministry of Labour and Social Welfare (MOL). 2006. “Labour Force Survey 2004,” GRN: Windhoek MOL. 2002. “Labour Force Survey 2000,” GRN: Windhoek MOL. 2001. “Labour Force Survey 1997,” GRN: Windhoek.Ravallion, M (2004), “Pro-poor Growth: A Primer”, Development Research Group, The World Bank,

Washington, D. C.UNDP Namibia. “Trends in Human Development and Human Poverty in Namibia,” October 2007, UNDP

Namibia.Van Rooy, G., Roberts, B., Schier, C., Swartz, J., and Levine, S. 2006. “Poverty and Inequality in Namibia”,

SSD Discussion Paper No 1. Windhoek: University of Namibia.

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