Distributional Outcomes of a Decentralized Welfare Program
It is common for central governments, to delegate authority over the targeting of welfare programs to local community organizations - which may be better informed about who is poor, though possibly less accountable for getting the money to the loca...
| Main Authors: | , |
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| Format: | Working Paper |
| Language: | English en_US |
| Published: |
World Bank, Washington, DC
2015
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| Subjects: | |
| Online Access: | http://documents.worldbank.org/curated/en/2000/04/437760/distributional-outcomes-decentralized-welfare-program http://hdl.handle.net/10986/22184 |
| Summary: | It is common for central governments, to
delegate authority over the targeting of welfare programs to
local community organizations - which may be better informed
about who is poor, though possibly less accountable for
getting the money to the local poor - while the center
retains control over how much goes to each local region. The
authors outline a theoretical model of the interconnected
behavior of the various actors in such a setting. The models
information structure provides scope for econometric
identification. Applying data for a specific program in
Bangladesh, they find that overall targeting was mildly
pro-poor, mostly because of successful targeting within
villages. But this varied across villages. Although some
village characteristics promoted better targeting, these
were generally not the same characteristics that attracted
resources from the center. The authors observe that the
centers desire for broad geographic coverage, appears to
have severely constrained the scope for pro-poor village
targeting. However, poor villages tended not to be better at
reaching their poor. They find some evidence that local
institutions matter. The presence of cooperatives for
farmers and the landless, appears to be associated with more
pro-poor program targeting. The presence of recreational
clubs has the opposite effect. Sometimes the benefits of
decentralized social programs are captured by local elites,
depending on the type of spending being decentralized. When
public spending us on private (excludable) good, and there
is no self-targeting mechanism to ensure that only the poor
participate, there is ample scope for local mistargeting. |
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