Education Global Practice
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Education, Poverty and inequality, Labor markets, Economics of education
Education Global Practice
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Last updated January 31, 2023
Jaime Saavedra leads the Education Global Practice at the World Bank Group. He rejoined the World Bank Group from the Government of Peru, where he served as Minister of Education from 2013 through 2016. During his tenure, the performance of Peru’s education system improved substantially as measured by international learning assessments. Throughout his career, Mr. Saavedra, a Peruvian national, has led groundbreaking work in the areas of poverty and inequality, employment and labor markets, the economics of education, and monitoring and evaluation systems. He has held positions at a number of international organizations and think-tanks, among them the Inter-American Development Bank, Economic Commission for Latin America and the Caribbean, International Labour Organization, Grupo de Análisis para el Desarollo and the National Council of Labor in Peru. He has also held teaching and research positions in academia and has published extensively. Prior to assuming his role as Minister for Education of Peru, he had a ten year career at the World Bank where, most recently, he served as Director for Poverty Reduction and Equity as well as Acting Vice President, Poverty Reduction & Economic Management Network. Mr. Saavedra holds a Ph.D in economics from Columbia University and a Bachelor's degree in economics from the Catholic University of Peru.
Publication Search Results
Now showing 1 - 9 of 9
Publication(World Bank, Washington, DC, 2012-11) Inchauste, Gabriela ; Azevedo, João Pedro ; Olivieri, Sergio ; Saavedra, Jaime ; Winkler, HernanImprovement in labor market conditions has been the main explanation behind many of the poverty success stories observed in the last decade, that is the primary conclusion of an analysis of changes in poverty by income source. Changes in labor earnings were the largest contributor to poverty reduction for a sample of 16 countries where poverty increased substantially. In 10 of these countries, labor income explained more than half of the change in poverty, and in another 4 countries, it accounted for more than 40 percent of the reduction in poverty. A declining dependency rate accounts for over a fifth of the reduction in poverty in 10 out of 16 countries, while transfers and other non-earned incomes account for more than a quarter of the reduction in poverty in 9 of these countries. A further decomposition of the contribution of labor income to poverty reduction in Bangladesh, Peru, and Thailand found that changes in individual characteristics (education, work experience, and region of residence) were important, but that overall, increases in real earnings among the poor matter the most.
Publication(World Bank, Washington, DC, 2013-10) Narayan, Ambar ; Saavedra-Chanduvi, Jaime ; Tiwari, SaileshFocusing on the welfare of the less well off as a measure of real societal progress is the fundamental principle underlying the WBG indicator of "shared prosperity", namely income growth of the bottom 40 percent in every country. This paper uses a database assembled by the World Bank Group to investigate some basic characteristics of shared prosperity, particularly its relationship with overall economic growth and inequality. Initial estimates using this dataset of 79 countries show that median income growth of the bottom 40 percent (circa 2005-2010) was 4.2 percent, a high number in comparison to the 3.1 percent per capita income growth of the overall population. In addition, the low and lower-middle income countries appear to be trailing the upper middle and high income countries in boosting shared prosperity. Establishing conceptual links between income growth of the bottom 40 percent, the overall growth rate and reviewing existing evidence on how these relate to inequality, the paper discusses two main ideas. First, shared prosperity is strongly correlated with overall prosperity implying that the whole host of policies that are important to generate and sustain growth remain relevant. Second, boosting shared prosperity will also require a concerted effort to strengthen the social contract, particularly in the area of promoting equality of opportunity. Growing evidence suggests that improving access for all and reducing inequality of opportunities -- particularly those related to human capital development of children -- are not only about "fairness" and building a "just society", but also about realizing a society's aspirations of economic prosperity.
Publication(World Bank, Washington, DC, 2014-05) Olinto, Pedro ; Lara Ibarra, Gabriel ; Saavedra-Chanduvi, JaimeThis paper re-examines the roles of changes in income and inequality in poverty reduction. The study provides estimates of the relative effects of inequality reduction versus growth promotion in reducing poverty for countries with different levels of initial poverty. The analysis uses country panel-data for 1980-2010. The results indicate that, as countries become less poor, inequality-reducing policies are likely to become relatively more effective for poverty reduction than growth-promoting policies. The results indicate that the growth elasticity of poverty reduction either increases or remains constant with the level of initial poverty. Nevertheless, the results also strongly indicate that, as poverty declines, the inequality elasticity of poverty reduction increases faster. Therefore, if the marginal cost of reducing inequality relative to the marginal cost of increasing growth does not increase with lower poverty levels, to accelerate poverty reduction, greater emphasis should be given to equity rather than growth as countries attain higher levels of development.
Publication(World Bank, Washington, DC, 2005-12) Arias, Omar ; Blom, Andreas ; Bosch, Mariano ; Cunningham, Wendy ; Fiszbein, Ariel ; Lopez Acevedo, Gladys ; Maloney, William ; Saavedra, Jaime ; Sanchez-Paramo, Carolina ; Santamaria, Mauricio ; Siga, LucasThis paper selectively synthesizes much of the research on Latin American and Caribbean labor markets in recent years. Several themes emerge that are particularly relevant to ongoing policy dialogues. First, labor legislation matters, but markets may be less segmented than previously thought. The impetus to voluntary informality, which appears to be a substantial fraction of the sector, implies that the design of social safety nets and labor legislation needs to take a more integrated view of the labor market, taking into account the cost-benefit analysis workers and firms make about whether to interact with formal institutions. Second, the impact of labor market institutions on productivity growth has probably been underemphasized. Draconian firing restrictions increase litigation and uncertainty surrounding worker separations, reduce turnover and job creation, and poorly protect workers. But theory and anecdotal evidence also suggest that they, and other related state or union induced rigidities, may have an even greater disincentive effect on technological adoption, which accounts for half of economic growth. Finally, institutions can affect poverty and equity, although the effects seem generally small and channels are not always clear. Overall, the present constellation of labor regulations serves workers and firms poorly and both could benefit from substantial reform.
Publication(Washington, DC: World Bank, 2015) Dabalen, Andrew ; Narayan, Ambar ; Saavedra-Chanduvi, Jaime ; Suarez, Alejandro Hoyos ; Abras, Ana ; Tiwari, SaileshThis study explores the changing opportunities for children in Africa. While the definition of opportunities can be subjective and depend on the societal context, this report focuses on efforts to build future human capital, directly (through education and health investments) and indirectly (through complementary infrastructure such as safe water, adequate sanitation, electricity, and so on). It follows the practice of earlier studies conducted for the Latin America and the Caribbean (LAC) region (Barros et al. 2009, 2012) where opportunities are basic goods and services that constitute investments in children. Although several opportunities are relevant at different stages of an individual s life, our focus on children s access to education, health services, safe water, and adequate nutrition is due to the well-known fact that an individual s chance of success in life is deeply influenced by access to these goods and services early in life. Children s access to these basic services improves the likelihood of a child being able to maximize his/her human potential and pursue a life of dignity.
Publication(World Bank Group, Washington, DC, 2014-08-12) Inchauste, Gabriela ; Azevedo, João Pedro ; Essama-Nssah, B. ; Olivieri, Sergio ; Van Nguyen, Trang ; Saavedra-Chanduvi, Jaime ; Winkler, HernanUnderstanding Changes in Poverty brings together different methods to decompose the contributions to poverty reduction. A simple approach quantifies the contribution of changes in demographics, employment, earnings, public transfers, and remittances to poverty reduction. A more complex approach quantifies the contributions to poverty reduction from changes in individual and household characteristics, including changes in the sectoral, occupational, and educational structure of the workforce, as well as changes in the returns to individual and household characteristics. Understanding Changes in Poverty implements these approaches and finds that labor income growth that is, growth in income per worker rather than an increase in the number of employed workers was the largest contributor to moderate poverty reduction in 21 countries experiencing substantial reductions in poverty over the past decade. Changes in demographics, public transfers, and remittances helped, but made relatively smaller contributions to poverty reduction. Further decompositions in three countries find that labor income grew mainly because of higher returns to human capital endowments, signaling increases in productivity, higher relative price of labor, or both. Understanding Changes in Poverty will be of particular relevance to development practitioners interested in better understanding distributional changes over time. The methods and tools presented in this book can also be applied to better understand changes in inequality or any other distributional change.
Outcomes, Opportunity and Development : Why Unequal Opportunities and Not Outcomes Hinder Economic Development(World Bank, Washington, DC, 2013-12) Molina, Ezequiel ; Narayan, Ambar ; Saavedra-Chanduvi, JaimeThis paper studies the relationship between inequality of opportunity and development outcomes in a cross-country setting. Scholars have long debated the impact of inequality on growth, development, and the quality of institutions in a society. The empirical relationships are however confounded by the notion that "inequality" can be seen as a composite of inequality arising from differences in effort and ability, which would tend to encourage competition and productivity, and inequality attributable to unequal opportunities, particularly in terms of access to basic goods and services, which might translate to wasted human potential and lower levels of development. The analysis in this paper applies a measure of educational opportunities that incorporates inequality between "types" or circumstance groups. Theories from economic history are used to instrument for this type of inequality in a large cross-country dataset. The results seem to confirm the hypothesis that this measure of inequality of opportunity is a better fit for structural inequality than the Gini index of income. The results suggest that inequality of endowments at the outset of history led to unequal educational opportunities, which in turn affected development outcomes such as institutional quality, infant mortality, and economic growth. The findings are robust to several checks on the instrumental variable specification.
Publication(World Bank, Washington, DC, 2013-04) Azevedo, Joao Pedro ; Inchauste, Gabriela ; Olivieri, Sergio ; Saavedra, Jaime ; Winkler, HernanDemographics, labor income, public transfers, or remittances: Which factor contributes the most to observed reductions in poverty? Using counterfactual simulations, this paper accounts for the contribution labor income has made to the observed changes in poverty over the past decade for a set of 16 countries that have experienced substantial declines in poverty. In contrast to methods that focus on aggregate summary statistics, the analysis generates entire counterfactual distributions that allow assessing the contributions of different factors to observed distributional changes. Decompositions across all possible paths are calculated so the estimates are not subject to path-dependence. The analysis shows that for most countries in the sample, labor income is the most important contributor to changes in poverty. In ten of the countries, labor income explains more than half of the change in moderate poverty; in another four, it accounts for more than 40 percent of the reduction in poverty. Although public and private transfers were relatively more important in explaining the reduction in extreme poverty, more and better-paying jobs were the key factors behind poverty reduction over the past decade.
Publication(Washington, DC: World Bank, 2007) Perry, Guillermo E. ; Maloney, William F. ; Arias, Omar S. ; Fajnzylber, Pablo ; Mason, Andrew D. ; Saavedra-Chanduvi, JaimeInformality: exit and exclusion analyzes informality in Latin America, exploring root causes and reasons for and implications of its growth. The authors use two distinct but complementary lenses: informality driven by exclusion from state benefits or the circuits of the modern economy, and driven by voluntary 'exit' decisions resulting from private cost-benefit calculations that lead workers and firms to opt out of formal institutions. They find both lenses have considerable explanatory power to understand the causes and consequences of informality in the region. Informality: exit and exclusion concludes that reducing informality levels and overcoming the 'culture of informality' will require actions to increase aggregate productivity in the economy, reform poorly designed regulations and social policies, and increase the legitimacy of the state by improving the quality and fairness of state institutions and policies. Although the study focuses on Latin America, its analysis, approach, and conclusions are relevant for all developing countries.