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Targeting Performance under Self-selection and Administrative Targeting Methods

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  • David P. Coady
  • Susan W. Parker

Abstract

We evaluate the contributions of self-selection and administrative targeting to program targeting performance using unique household survey data collected for the evaluation of a Mexican social program that has acted as a regional prototype. Both forms of targeting improve targeting performance, but administrative selection based on proxy-means testing plays a crucial role in reducing total program coverage (to meet a budget constraint) while maintaining high coverage among the lowest income groups. Its importance is reinforced when existing knowledge barriers to participation are addressed, reflecting the high application rates among higher-income groups conditional on knowledge. Differentiating transfers based on household demographics also substantially improves targeting performance reflecting the linking of transfers to the number of children. Although expansion of the program to reduce the remaining undercoverage is likely to come at the expense of targeting performance, this trade-off can be reduced by improving the underlying proxy-means algorithm and linking transfer levels directly to proxy-means scores. The latter should also improve the contribution of self-selection to targeting performance. (c) 2009 by The University of Chicago. All rights reserved.

Suggested Citation

  • David P. Coady & Susan W. Parker, 2009. "Targeting Performance under Self-selection and Administrative Targeting Methods," Economic Development and Cultural Change, University of Chicago Press, vol. 57(3), pages 559-587, April.
  • Handle: RePEc:ucp:ecdecc:v:57:y:2009:i:3:p:559-587
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    References listed on IDEAS

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    1. Stephen Pudney & Monica Hernandez & Ruth Hancock, 2007. "The welfare cost of means-testing: pensioner participation in income support," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 22(3), pages 581-598.
    2. James J. Heckman & Jeffrey A. Smith, 2004. "The Determinants of Participation in a Social Program: Evidence from a Prototypical Job Training Program," Journal of Labor Economics, University of Chicago Press, vol. 22(2), pages 243-298, April.
    3. Lanjouw, Peter & Ravallion, Martin, 1995. "Poverty and Household Size," Economic Journal, Royal Economic Society, vol. 105(433), pages 1415-1434, November.
    4. David Coady & Emmanuel Skoufias, 2004. "On the Targeting and Redistributive Efficiencies of Alternative Transfer Instruments," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 50(1), pages 11-27, March.
    5. Angus Deaton & Christina Paxson, 1998. "Economies of Scale, Household Size, and the Demand for Food," Journal of Political Economy, University of Chicago Press, vol. 106(5), pages 897-930, October.
    6. David P. Coady & Rebecca L. Harris, 2004. "Evaluating transfer programmes within a general equilibrium framework," Economic Journal, Royal Economic Society, vol. 114(498), pages 778-799, October.
    7. Duclos, Jean-Yves, 1995. "Modelling the take-up of state support," Journal of Public Economics, Elsevier, vol. 58(3), pages 391-415, November.
    8. Skoufias, Emmanuel & Davis, Benjamin & de la Vega, Sergio, 2001. "Targeting the Poor in Mexico: An Evaluation of the Selection of Households into PROGRESA," World Development, Elsevier, vol. 29(10), pages 1769-1784, October.
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    Cited by:

    1. David Coady & César Martinelli & Susan W. Parker, 2013. "Information and Participation in Social Programs," World Bank Economic Review, World Bank Group, vol. 27(1), pages 149-170.
    2. Baird, Sarah & McIntosh, Craig & Özler, Berk, 2013. "The regressive demands of demand-driven development," Journal of Public Economics, Elsevier, vol. 106(C), pages 27-41.
    3. Morawetz, Ulrich & Sinabell, Franz, 2015. "Assessment Of Targeting In The Rural Development Programme: A Case Study Of The Austria Investment Support Measure," 55th Annual Conference, Giessen, Germany, September 23-25, 2015 210576, German Association of Agricultural Economists (GEWISOLA).
    4. González-Flores, Mario & Heracleous, Maria & Winters, Paul, 2012. "Leaving the Safety Net: An Analysis of Dropouts in an Urban Conditional Cash Transfer Program," World Development, Elsevier, vol. 40(12), pages 2505-2521.
    5. Peralta, Maria Alexandra & Swinton, Scott M. & Maredia, Mywish K., 2011. "Accounting for selection bias in impact analysis of a rural development program: An application using propensity score matching," 2012 Conference, August 18-24, 2012, Foz do Iguacu, Brazil 126398, International Association of Agricultural Economists.
    6. Houssou, Nazaire & Zeller, Manfred & Alcaraz V., Gabriela & Johannsen, Julia & Schwarze, Stefan, 2010. "How Best to Target the Poor? An operational targeting of the poor using indicator-based proxy means tests," 2010 AAAE Third Conference/AEASA 48th Conference, September 19-23, 2010, Cape Town, South Africa 95780, African Association of Agricultural Economists (AAAE);Agricultural Economics Association of South Africa (AEASA).
    7. Cuong Viet Nguyen & Anh Tran, 2014. "Poverty identification: practice and policy implications in Vietnam," Asian-Pacific Economic Literature, Asia Pacific School of Economics and Government, The Australian National University, vol. 28(1), pages 116-136, May.

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