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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
Source: Calculated from NHIES 1993/1994 and 2003/2004 data
Gini-coefficients
0.7220.809Households
0.7080.727Deciles
Households
0.6040.713Individuals
0.5900.701Deciles
Individuals2003/20041993/1994
Source: Calculated from NHIES 1993/1994 and 2003/2004 data
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
Source: Calculated from NHIES 1993/1994 and 2003/2004 data
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
33118Access30263043Owns
Cattle
1410319Access12213672Owns
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.