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Remarks at the Human Capital Conclave

(World Bank, Washington, DC, 2021-04-05) Malpass, David

David Malpass, President of the World Bank, discussed the importance of investing in human capital for a green, resilient, and inclusive recovery from the Coronavirus disease crisis. He highlighted three important measures: 1) investing in people; 2) efficient expenditures and good governance; and 3) freeing up fiscal space.
When We're Sixty-Four: Opportunities and Challenges for Public Policies in a Population-Aging Context in Latin America

(Washington, DC: World Bank, 2020-10-02) Rofman, Rafael ; Apella, Ignacio

Latin American countries are in the midst of a demographic transition and, as a consequence, a population-aging process. Over the next few decades, the number of children will decline relative to the number of older adults. Population aging is the result of a slow but sustained reduction in mortality rates, given increases in life expectancy and fertility. These trends reflect welcome long-term improvements in welfare and in economic and social development. But this process also entails policy challenges: many public institutions—including education, health, and pension systems and labor market regulations—are designed for a different demographic context and will need to be adapted. When We’re Sixty-Four discusses public policies aimed at overcoming the two main challenges facing Latin American countries concerning the changing demographics. On one hand, older populations demand more fiscal resources for social services, such as health, long-term care, and pensions. On the other, population aging produces shifts in the proportion of the population that is working age, which may affect long-term economic growth. Aging societies risk losing dynamism, being exposed to higher dependency rates, and experiencing lower savings rates. Nonetheless, in the interim, Latin American countries have a demographic opportunity: a temporary decline in dependency rates creates a period in which the share of the working-age population, with its associated saving capacity, is at its highest levels. This constitutes a great opportunity in the short term because the higher savings may result in increases in capital endowment per worker and productivity. For that to happen, it is necessary to generate institutional, financial, and fiscal conditions that promote larger savings and investment, accelerating per capita economic growth in a sustainable way.
Toward More Efficient and Effective Public Social Spending in Central America

(World Bank, Washington, DC, 2017-05-18) Acosta, Pablo A. ; Almeida, Rita ; Gindling, Thomas ; Lao Pena, Christine

Central America has come a long way both in terms of economic and political stability. Increasingly the region is focusing on implementing productivity-enhancing reforms as well as supporting reductions in poverty and inequality. This report analyzes recent trends in public social spending in Central America from 2007 to 2014, conducts international benchmarking, examines measures of the effectiveness and efficiency of social spending, and discusses the quality of selected institutions influencing this spending. We examine total social spending, as well as detailing its four components: public spending on the education, health, and social protection and labor (SPL) sectors. In analyzing public social spending, the report addresses three crucial policy issues: (a) how to improve the coverage and redistributional incidence of public social spending; (b) how to enhance the effectiveness and efficiency of public social spending; and (c) how to strengthen the institutions governing public spending in the social sector. While based heavily on a series of recent analytical social spending studies in six countries in the subregion—Costa Rica, El Salvador, Guatemala, Honduras, Nicaragua, and Panama—this report also takes a broader regional perspective and includes some comparisons to countries in other regions.
Impact Evaluation in Practice, Second Edition

(Washington, DC: Inter-American Development Bank and World Bank, 2016-09-13) Gertler, Paul J. ; Martinez, Sebastian ; Premand, Patrick ; Rawlings, Laura B. ; Vermeersch, Christel M. J.

The second edition of the Impact Evaluation in Practice handbook is a comprehensive and accessible introduction to impact evaluation for policy makers and development practitioners. First published in 2011, it has been used widely across the development and academic communities. The book incorporates real-world examples to present practical guidelines for designing and implementing impact evaluations. Readers will gain an understanding of impact evaluations and the best ways to use them to design evidence-based policies and programs. The updated version covers the newest techniques for evaluating programs and includes state-of-the-art implementation advice, as well as an expanded set of examples and case studies that draw on recent development challenges. It also includes new material on research ethics and partnerships to conduct impact evaluation. The handbook is divided into four sections: Part One discusses what to evaluate and why; Part Two presents the main impact evaluation methods; Part Three addresses how to manage impact evaluations; Part Four reviews impact evaluation sampling and data collection. Case studies illustrate different applications of impact evaluations. The book links to complementary instructional material available online, including an applied case as well as questions and answers. The updated second edition will be a valuable resource for the international development community, universities, and policy makers looking to build better evidence around what works in development.
Central America Social Expenditures and Institutional Review: Nicaragua

(World Bank, Washington, DC, 2016-08-30) World Bank

Nicaragua has had decent economic growth in the past decade, which has contributed to substantial poverty reduction (the largest in Central America), as well as improvements in human development indicators. Fiscal accounts have deteriorated recently, which may pose some challenges to the sustainability of current levels of financing for social sector expenditures. Better planning and monitoring of social spending are needed to improve Nicaragua’s budget management. While Nicaragua has a medium-term development plan, the use of results-oriented budget formulation is still in its early stages. Low and inefficient public spending in education, coupled with outdated legal and institutional frameworks and high dropout rates present are significant barriers to increasing enrollment and providing quality education. Progress in key areas such as child and maternal mortality, but lowest per capita health spending in Central America, as well as institutional and governance challenges limit coverage and quality of services. There is need for increased spending in social assistance interventions, better coordination among implementing agencies, and revised targeting to ensure decent coverage of programs among the poorest. Government policies also reflect the need for improved controls and implement social audits, which are considered a pillar of participatory governance. However, these still need to be implemented on a broader scale and publicly disseminated.
Central America Social Expenditures and Institutional Review: Guatemala

(World Bank, Washington, DC, 2016-08-25) World Bank

Social spending in Guatemala needs to achieve efficiency gains and increase to minimum levels to meet basic human development objectives. Current levels are so low that fiscal reform (in revenue generation and spending allocation) is urgently needed so that the state can fulfill its mandated coverage and quality in social service provision. In the last ten years, Guatemala has had decent economic growth but failed to improve human development indicators or reduce poverty (which has increased). Low and inefficient public spending, coupled with outdated legal and institutional frameworks, are significant barriers to increasing enrollment and providing quality education. Moving forward, more efficient, equitable, and cost-effective public education spending will require some important policy and institutional changes, including greater use of the incipient monitoring and evaluation system. There is need for increased spending in social assistance interventions, better coordination among implementing agencies, and revised targeting to ensure decent coverage of programs among the poorest. On the institutional side, the launching of the Ministry of Social Development (MIDES) provided a platform to manage the different programs of the sector under one umbrella; however, MIDES has not yet been able to tackle technical deficiencies in implementation.
Central America Social Expenditures and Institutional Review: Panama

(World Bank, Washington, DC, 2015-07-06) World Bank Group

Panama has experienced impressive and significant economic growth, emerging as one of the better performers in Central America in recent years and one of the fastest growing economies worldwide. From 2003 to 2013, Panama has averaged an annual GDP growth rate of approximately 7 percent, surpassing the average GDP growth in Central America. It has also emerged as one of the fastest growing economies worldwide. Even during the economic crisis of 2008-2009, its economy continued to grow albeit at a lower rate. This note recommends that Panama prioritize three main aspects: a) improving the effectiveness of social public spending by further enhancing the pro-poor and pro-indigenous features of targeting mechanisms; b) reducing inefficiencies in the various sectors, for example, by improving the coordination between the Ministries of Education, Health, Social Development, and CSS to minimize duplication of efforts and resources; and c) strengthening planning, budgeting, and information tools and systems, legislation, and institutions to support implementation and track progress toward Government goals.
Central America Social Expenditures and Institutional Review: El Salvador

(Washington, DC, 2015-06-29) World Bank

El Salvador’s development over the past decade has been dichotomous. On the one hand, economic growth has remained persistently low, employment and labor force participation have barely increased, and progress on poverty reduction has slowed. On the other hand, inequality has fallen, and shared prosperity improved together with advances in many social indicators, such as pre-primary enrollment rates, access to prenatal care, immunizations, and water and sanitation. The increase in the use of social spending, which now accounts for 12.4 percent of GDP, together with an improvement in the quality of social spending, explain at least part of this dichotomy of redistributive and social gains despite low growth, a tight fiscal situation and generally low government revenues and spending. Looking forward, the key challenges El Salvador faces are related to continuing improving the quality and efficiency in the social sectors, while maintaining the overall level of social spending within an increasingly constrained fiscal environment, where fiscal constraints, low revenues, and the need to cut the deficit by 3 percent of GDP are significant elements, as well. Priority will have to be given to reallocations and improvements within the spending envelope for the social sectors to maximize impact. This document analyzes social spending for El Salvador for the education, health and social protection and labor sectors in depth and explores a series of policy options for El Salvador to reallocate social spending for more effective impacts, to enhance and reform social policies and social service delivery, and to improve the management of public spending and budget execution in the social sectors.
Central America Social Expenditures and Institutional Review: Honduras

(Washington, DC, 2015-06-29) World Bank

Honduras has experienced moderate economic growth in the past decade, in line with the rest of the region. Despite this growth track record, limited opportunities for decent jobs for the majority of workers have resulted in stagnant poverty and inequality rates that are still the highest in Central America (CA). In parallel, progress in human development indicators has also been mixed in the last decade. In education, while primary enrollment has significantly increased, low coverage at all other levels of education, inequalities in access and low quality persist. In health, Honduras is close to achieving the 2015 child mortality Millennium Development Goals (MDGs), but maternal mortality, noncommunicable diseases (NCDs), and violence pose additional challenges. And despite advances in setting up a social protection system, fiscal sustainability and lack of coordination among interventions prevail, undermining poverty reduction efforts. The ability of the Honduras government to expand safety nets, to increase the access and quality of public education and health services, to engage in active labor market policies, and to improve human development indicators in general, remains limited for a number of reasons. First, overall real social public spending has been on the decline in the last few years. Second, low revenues and fiscal deterioration pose challenges to adequately financing needed social sector improvements. Third, challenges in budget formulation and execution (mainly due to institutional factors) also diminish the impact of social spending. But more importantly, Honduras needs to significantly improve the effectiveness and efficiency of its social spending. This note argues that moving forward Honduras should prioritize three main aspects: a) to rationalize and increase the effectiveness of social public spending by enhancing the pro-poor features of targeting mechanisms; b) to significantly redress the imbalance between recurrent spending, especially the wage bill, and capital expenditure; and c) to continue strengthening information systems tools, legislation, and institutions in an effort to consolidate programs into fewer and higher impact interventions. Sector-specific challenges aligned with these broad objectives are addressed below.
Central America Social Expenditures and Institutional Review: Costa Rica

(World Bank, Washington, DC, 2015-06-14) World Bank

The evolution of Costa Rica’s social sectors over the past decade has been dichotomous. On the one hand, economic growth has remained relatively high, however poverty and inequality have not declined (moreover, they have increased), and persistent employment challenges remain. On the other hand, the country has continued experiences advances in many social indicators, such as pre-primary and tertiary enrollment rates, access to improved sanitation, and labor force participation, though not in others (secondary school completion, immunizations, employment). Higher economic growth and (to a lesser extent) revenues seem to have allowed a substantial increase in public social spending. Looking forward, the key challenges Costa Rica faces are related to continuing improving the quality and efficiency in the social sectors, while improving targeting to serve the most in need, in a tight and severe fiscal context. To expand coverage of excluded population, priority will have to be given to reallocations and improvements within the spending envelope for the social sectors to maximize impact. With a fiscal deficit of more than 6 percent of GDP, further expanding public social spending is no longer an option and budget cuts are looming. Improvements in public spending management and budget execution, including the need of institutional reform to consolidate programs and improve coordination among executing agencies is equally important. In a country that has long been the champion in expanding universal welfare state, sustainability concerns will imply that hard fiscal decisions would need to be made to increase the social returns of budget allocation.