Other Poverty Study

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    Aspiring Indonesia—Expanding the Middle Class
    (World Bank, Washington, DC, 2019-09) World Bank
    Indonesia has seen tremendous progress in poverty reduction over the past couple of decades and, as a result, has made a successful transition from low-income to middle-income country status. As millions have moved out of poverty and extreme poverty, we have also witnessed the rise of Indonesia’s middle class, which now accounts for 20 percent of the total population, or 52 million Indonesians. This group important for Indonesia’s upward trajectory, but it still too small for the ambitions of Indonesia. Expanding the middle class will boost economic growth, strengthen an influential constituency for better governance, and widen and deepen the tax base. An expansion of the middle class, if accompanied by continued growth in the incomes of the poor and vulnerable, will also help to decrease inequality and prevent polarization of the country. One of the key development questions that Indonesia faces is how to expand the middle class. What will be required to bring the 115 million people who are no longer in poverty and vulnerability into the middle class? The future of Indonesia lies partly in the fate of this aspiring middle class, 45 percent of the population, so that they can both share in and help to drive the country’s growing prosperity. Government policy can play an instrumental role in expanding the middle class. This can be done by increasing the level and quality of education, and the skills of the population, and making sure there are well-paid jobs waiting for those in the aspiring middle class. It also means ensuring access to social protection to help lift these aspirers into the middle class and keep them there once they arrive, as well as improving the quality of the public services upon which they currently depend. Resolve to expand the middle class will place greater stress on government budgets. The government will need increasingly rely on the middle class, whose income taxes will finance much of the investment that a growing Indonesia will need. This will require a new social contract with the current – and future – middle class so that they will embrace the policies that both benefit themselves while also helping to expand their ranks, rather than closing off opportunities for others, and creating political polarization—as has occurred in some countries in the region in recent years.
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    Poverty and Economic Mobility in the Kyrgyz Republic: Some Insights from the Life in Kyrgyzstan Survey
    (World Bank, Washington, DC, 2015-04-27) World Bank Group
    This report focuses on the economic mobility of individuals (and corresponding households) belonging to the bottom 40 percent of the Kyrgyz population. This is indeed the target population chosen by the World Bank Group for the achievement of its second and twin goal of shared prosperity (the first one remaining poverty reduction). Moreover, in the specific case of the Kyrgyz Republic total poverty rates in the period under analysis ranged between 34 and 37 percent, thus making the poverty and bottom 40 percent pools almost identical. For each selected transition group, the report depicts a detailed profile of corresponding main socio-economic characteristics. Four transition groups were in particular identified: (i) those who were found to be stuck in the bottom 40 percent in both 2010 and 2011; (ii) those who managed to move up from the bottom 40 percent in 2011; (iii) those who entered the bottom 40 percent in 2011, and (iv) those who managed to stay in the top 60 percent in both years under analysis. The evidence shows a few significant differences among these four groups in terms of both households’ invariant and individual characteristics.
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    Transitioning from Status to Needs Based Assistance for Georgia IDPs: A Poverty and Social Impact Analysis
    (World Bank, Washington, DC, 2015-02) World Bank
    This report presents to the Government of Georgia (GoG) an analysis of the implications of potential policy changes to internally displaced person (IDP) assistance. A pressing question for policy makers in Georgia is the sustainability of status-based IDP assistance and what efforts can be made to tailor this assistance to favor the poor and vulnerable. Elimination of the IDP benefit has been subject to debate among policymakers. The World Bank has worked with the government to support improvements to the socioeconomic situation of IDPs in Georgia since 2008. The IDP Community Development Project, implemented between 2009-2012 improved service delivery, infrastructure, and livelihoods in over 40 IDP communities. Evidence on the socio-economic needs of IDPs has been collected by both government and donors; yet no comprehensive research has been conducted to critically compare their situation to that of the overall population. The objective of this research is to generate more evidence on the significance of the IDP benefit, and consequences that may be expected if this benefit is removed, in order to inform future policy decisions of the GoG in this regard. The report examines: (i) the policy and institutional framework and considerations that may support or obstruct a shift in IDP assistance; (ii) quantitative evidence on the socio-economic situation of IDPs as compared to non-IDPs in Georgia; and (iii) qualitative evidence on the significance of the IDP benefit, attitudes towards the benefit program, and vulnerabilities that may arise from its potential elimination. The paper concludes with policy recommendations for mitigating negative poverty and social impacts, should the government pursue a decision to remove the IDP benefit program.