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Evaluating Pro-poor Transfers When Targeting is Weak: The Albanian Ndihma Ekonomike Program Revisited

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Abstract

The Albanian Ndihma Ekonomike is one of the first poverty reduction programs launched in transitional economies. Its record has been judged positively during the recession period of the 1990s and negatively during the more recent growth phase. This paper reconsiders the program using a regression-adjusted matching estimator rst suggested by Heckman et al. (1997, 1998) and exploiting discontinuities in program design and targeting failures. We nd the program to have a weak targeting capacity and a negative and signi cant impact on welfare. We also nd that recent changes introduced to the program have not improved its performance. An analysis of the distributional impact of treatment based on stochastic dominance theory suggests that our results are robust.

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Paper provided by Universita' degli Studi di Firenze, Dipartimento di Scienze per l'Economia e l'Impresa in its series Working Papers - Economics with number wp2009_08.rdf.

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Length: 38 pages
Date of creation: 2009
Date of revision:
Handle: RePEc:frz:wpaper:wp2009_08.rdf

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Keywords: Social assistance; Poverty; Impact Evaluation; Albania;

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  1. Giovanni Andrea Cornia & Frances Stewart, 1993. "Two errors of targeting," Journal of International Development, John Wiley & Sons, Ltd., vol. 5(5), pages 459-496, 09.
  2. Okrasa, Wlodzimierz, 1999. "Who avoids and who escapes from poverty during transition? - evidence from Polish panel data, 1993-96," Policy Research Working Paper Series 2218, The World Bank.
  3. Dabalen, Andrew & Kilic, Talip & Wane, Waly, 2008. "Social Transfers, Labor Supply and Poverty Reduction: The Case of Albania," Policy Research Working Paper Series 4783, The World Bank.
  4. Galasso, Emanuela & Ravallion, Martin, 2005. "Decentralized targeting of an antipoverty program," Journal of Public Economics, Elsevier, vol. 89(4), pages 705-727, April.
  5. Heckman, James J & Ichimura, Hidehiko & Todd, Petra E, 1997. "Matching as an Econometric Evaluation Estimator: Evidence from Evaluating a Job Training Programme," Review of Economic Studies, Wiley Blackwell, vol. 64(4), pages 605-54, October.
  6. Abadie A., 2002. "Bootstrap Tests for Distributional Treatment Effects in Instrumental Variable Models," Journal of the American Statistical Association, American Statistical Association, vol. 97, pages 284-292, March.
  7. Dominique van de Walle, 2003. "Are Returns to Investment Lower for the Poor? Human and Physical Capital Interactions in Rural Vietnam," Review of Development Economics, Wiley Blackwell, vol. 7(4), pages 636-653, November.
  8. Case, A, 1996. "Election Goals and Income Redistribution : Recent Evidence from Albania," Papers 177, Princeton, Woodrow Wilson School - Public and International Affairs.
  9. Okrasa,Wlodzimierz, 1999. "The dynamics of poverty and the effectiveness of Poland's safety net (1993-96)," Policy Research Working Paper Series 2221, The World Bank.
  10. Edwin Leuven & Barbara Sianesi, 2003. "PSMATCH2: Stata module to perform full Mahalanobis and propensity score matching, common support graphing, and covariate imbalance testing," Statistical Software Components S432001, Boston College Department of Economics, revised 12 Feb 2014.
  11. Verme, Paolo, 2008. "Social assistance and poverty reduction in Moldova, 2001-2004 an impact evaluation," Policy Research Working Paper Series 4658, The World Bank.
  12. Marco Caliendo & Sabine Kopeinig, 2008. "Some Practical Guidance For The Implementation Of Propensity Score Matching," Journal of Economic Surveys, Wiley Blackwell, vol. 22(1), pages 31-72, 02.
  13. Todd, Petra E., 2008. "Evaluating Social Programs with Endogenous Program Placement and Selection of the Treated," Handbook of Development Economics, Elsevier.
  14. Milanovic, Branko, 2000. "Social transfers and social assistance - an empirical analysis using Latvian household survey data," Policy Research Working Paper Series 2328, The World Bank.
  15. Michael Lokshin & Martin Ravallion, 2000. "Welfare Impacts of the 1998 Financial Crisis in Russia and the Response of the Public Safety Net," The Economics of Transition, The European Bank for Reconstruction and Development, vol. 8(2), pages 269-295, July.
  16. Foster, James E & Shorrocks, Anthony F, 1988. "Poverty Orderings," Econometrica, Econometric Society, vol. 56(1), pages 173-77, January.
  17. Heckman, James J & Ichimura, Hidehiko & Todd, Petra, 1998. "Matching as an Econometric Evaluation Estimator," Review of Economic Studies, Wiley Blackwell, vol. 65(2), pages 261-94, April.
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Cited by:
  1. Lucia Mangiavacchi & Luca Piccoli, 2009. "Child welfare and intra-household inequality in Albania," Working Papers 149, ECINEQ, Society for the Study of Economic Inequality.

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