Sanchez, Carolina

Poverty and Equity Global Practice
Profile Picture
Author Name Variants
Fields of Specialization
Labor economics, Poverty and distributional analysis, Gender, Public policy, Inequality and Shared Prosperity, Jobs and Development
Poverty and Equity Global Practice
Externally Hosted Work
Contact Information
Last updated: January 31, 2023
Carolina Sánchez-Páramo, a Spanish national, is currently the Senior Director of the Poverty and Equity Global Practice (GP) at the World Bank. Prior to this assignment, she was the Poverty and Equity GP Practice Manager in the Europe and Central Asia region. Carolina has worked on operations, policy advice and analytical activities in Eastern Europe, Latin America and South Asia, and was part of the core team working on the WDR2012, “Gender Equality and Development”. Her main areas of interest and expertise include labor economics, poverty and distributional analysis, gender equality and welfare impacts of public policy. She has led reports on poverty and equity, labor markets and economic growth in several countries, as well as social sector operations. She has published articles in refereed journals and edited books on the topics described above. Carolina has a PhD in Economics from Harvard University.

Publication Search Results

Now showing 1 - 10 of 18
  • Publication
    Why So Gloomy?: Perceptions of Economic Mobility in Europe and Central Asia
    (World Bank, Washington, DC, 2015-12) Cancho, César; Dávalos, Maria E.; Sánchez-Páramo, Carolina
    Despite significant improvements in per capita expenditures and a marked decline in poverty over the 2000s, a large fraction of Eastern Europe and Central Asias population reports their economic situation in the late 2000s to be worse than in 1989. This paper uses data from the Life in Transition Survey to document the gap between objective and subjective economic mobility and investigate what may drive this apparent disconnection. The paper aims at identifying some of the drivers behind subjective perceptions of economic mobility, focusing on the role of perceptions of fairness and trust in shaping peoples perceptions of their upward or downward mobility. The results show that close to half of the households in the region perceive to have experienced downward economic mobility, that is, that their position in the income distribution has deteriorated. The results also show that perceptions of higher inequality, unfairness, and distrust in public institutions are associated with downward subjective economic mobility. The findings from this study confirm that factors beyond objective well-being are associated with the perceptions of mobility observed in Europe and Central Asia and may explain why the region has had such a pessimistic view of economic mobility during the past two decades. Understanding what drives peoples perceptions of their living standards and quality of life is important, because regardless of objective measures, perceptions could influence peoples behavior, including support for reforms and labor market decisions. For Eastern Europe and Central Asia, a region that has undergone substantive transformations and which is still going through a reform process, accounting for these aspects is critical.
  • Publication
    Simulating Distributional Impacts of Macro-dynamics : Theory and Practical Applications
    (World Bank Group, Washington, DC, 2014-09-23) Olivieri, Sergio; Radyakin, Sergiy; Lokshin, Michael; Narayan, Ambar; Sánchez-Páramo, Carolina
    Simulating Distributional Impacts of Macro-dynamics: Theory and Practical Applications is a comprehensive guide for analyzing and understanding the effects of macroeconomic shocks on income and consumption distribution, as well as using the ADePT Simulation Module. Since real-time micro data is rarely available, the Simulation Module (part of the ADePT economic analysis software) takes advantage of historical household surveys to estimate how current or proposed macro changes might impact household and individuals welfare. Using examples from different economic and social contexts, the book explains macro-micro linkages in an easy and intuitive way. After developing a sound theoretical foundation, readers are then shown how to explore their own scenarios using the Simulation Module. Step-by-step instructions illustrate data entry and show how to make adjustments using the Module’s options. Exercises present how different sections of the simulation process operate independently. This book will be a valuable reference for analysts needing to evaluate the potential impact of structural reforms and to generate projections for hypothetical scenarios. Results created by the Simulation Module will be helpful in informing governmental policymaking.
  • Publication
    Back to Work : Growing with Jobs in Europe and Central Asia
    (Washington, DC: World Bank, 2014-01-15) Arias, Omar S.; Sánchez-Páramo, Carolina; Dávalos, María E.; Santos, Indhira; Tiongson, Erwin R.; Gruen, Carola; de Andrade Falcão, Natasha; Saiovici, Gady; Cancho, Cesar A.
    Creating more and better jobs is arguably the most critical challenge to boosting shared prosperity in ECA. This report answers two questions: How can the countries create more jobs? Should there be specific policies to help workers access those jobs?. In answering them, the report examines the role of reforms, firms, skills, incentives and barriers to work, and labor mobility through the lens of two contextual factors: the legacy of centralized planned economies and the mounting demographic pressures associated with rapid aging in some countries and soaring numbers of youth entering the workforce in others. The main findings of the report are: i) market reforms pay off in terms of jobs and productivity, although with a lag; ii) a small fraction of superstar high-growth firms, largely young, account for most of new jobs created in the region- thus, countries, especially late reformers, need to unleash the potential of high levels of latent entrepreneurship to start-up new firms; iii) skills gaps hinder employment prospects, especially of youth and older workers, due to the inadequate response of the education and training system to changes in the demand for skills; iv) employment is hindered by high implicit taxes on work for those transitioning to work from inactivity or unemployment and barriers that affect especially women, minorities, youth and older workers; and, v) low internal labor mobility prevents labor relocation to places with greater job creation potential. The report argues that to get more people back to work by growing with jobs, countries need to regain the momentum for economic and institutional reforms that existed before the crisis in order to: (i) lay the fundamentals to create jobs for all workers, by pushing reforms to create the enabling environment for existing firms to grow, become more productive, or exit the market and tap on entrepreneurship potential for new firms to emerge and succeed or fail fast and cheap; and (ii) implement policies to support workers so they are prepared to take on the new jobs being created, by having the right skills, incentives and access to work, and being ready to move to places with the highest job creation potential.
  • Publication
    Knowing, When You Do Not Know : Simulating the Poverty and Distributional Impacts of an Economic Crisis
    (World Bank, 2012-01-12) Narayan, Ambar; Sánchez-Páramo, Carolina
    Economists have long sought to predict how macroeconomic shocks will affect individual welfare. Macroeconomic data and forecasts are easily available when crises strike. But policy action requires not only understanding the magnitude of a macro shock, but also identifying which households or individuals are being hurt by (or benefit from) the crisis. Moreover, in many cases, impacts on the ground might be already occurring as macro developments become known, while micro level evidence is still unavailable because of paucity of data. Because of these reasons, a comprehensive real-time understanding of how the aggregate changes will translate to impacts at the micro level remains elusive. This problem is particularly acute when dealing with developing countries where household data is sporadic or out of date. This volume outlines a more comprehensive approach to the problem, showcasing a micro simulation model, developed in response to demand from World Bank staff working in countries and country governments in the wake of the global financial crisis of 2008-09. During the growing catastrophe in a few industrialized countries, there was rising concern about how the crisis would affect the developing world and how to respond to it through public policies. World Bank staff s was scrambling to help countries design such policies; this in turn required information on which groups of the population, sectors and regions the crisis would likely affect and to what extent. The volume is organized as follows. Chapter 1 summarizes the methodology underlying the micro simulation model to predict distributional impacts of the crisis, along with several case studies that highlight how the model can be used in different country contexts. Chapters 2 to 4 are written by experts external to the Bank, two of whom participated as discussants at a workshop on the micro simulation work organized in May, 2010 at the World Bank headquarters. Chapter 2 comments on the broader implications and shortcomings of applying the technique described in Chapter 1 and the ability or willingness of governments to respond adequately to its results. Chapter 3 draws parallels between the United States and developing countries to discuss the lessons that can be learned for mitigating the impacts of future crises. Chapter 4 discusses how the micro simulation approach can be sharpened to make it a better tool for distributional analysis moving forward.
  • Publication
    The Impact of Recall Periods on Reported Morbidity and Health Seeking Behavior
    (2011-08-01) Das, Jishnu; Sánchez-Paramo, Carolina
    Between 2000 and 2002, the authors followed 1621 individuals in Delhi, India using a combination of weekly and monthly-recall health questionnaires. In 2008, they augmented these data with another 8 weeks of surveys during which households were experimentally allocated to surveys with different recall periods in the second half of the survey. This paper shows that the length of the recall period had a large impact on reported morbidity, doctor visits, time spent sick, whether at least one day of work/school was lost due to sickness, and the reported use of self-medication. The effects are more pronounced among the poor than the rich. In one example, differential recall effects across income groups reverse the sign of the gradient between doctor visits and per-capita expenditures such that the poor use health care providers more than the rich in the weekly recall surveys but less in monthly recall surveys. The authors hypothesize that illnesses -- especially among the poor -- are no longer perceived as "extraordinary events" but have become part of "normal" life. They discuss the implications of these results for health survey methodology, and the economic interpretation of sickness in poor populations.
  • Publication
    Regional Study on Targeting Systems and Practices : Draft Policy Note
    (World Bank, Washington, DC, 2010-06-28) Sanchez-Paramo, Carolina; Ghorpade, Yashodhan
    This policy note aims to take stock of regional experiences in the area of targeting, both in the context of government systems and the World Bank's operational work, in South Asia. The main objectives are to review targeting systems and practices in the context of government programs; to critically review the role for and impact of targeting in the WB's operational work; and to extract lessons that can be used to deepen the relevance and impact of the WB's operational work in South Asia. The evidence presented in this note will serve as a resource for those interested in and/or planning some work on targeting related work in the region. In this sense, by presenting information on both country systems and performance of WB-led work, the note targets both practitioners and managers. The analysis focuses first on the architecture of targeting systems in South Asia, and on the determinants of targeting effectiveness, including the choice and design of the targeting tool, implementation and monitoring of the targeting tool, and the design, implementation and monitoring of the targeted program. The note concludes that international evidence a large fraction of the observed differences in targeting effectiveness across systems and programs, can be attributed to factors related to implementation and monitoring. This implies that investments aimed at correcting resource, capacity and logistic limitations in government systems could go a long way in improving targeting outcomes in the region.
  • Publication
    Assessing Poverty and Distributional Impacts of the Global Crisis in the Philippines : A Microsimulation Approach
    (2010-04-01) Habib, Bilal; Narayan, Ambar; Olivieri, Sergio; Sanchez-Paramo, Carolina
    As the financial crisis has spread through the world, the lack of real-time data has made it difficult to track its impact in developing countries. This paper uses a micro-simulation approach to assess the poverty and distributional effects of the crisis in the Philippines. The authors find increases in both the level and the depth of aggregate poverty. Income shocks are relatively large in the middle part of the income distribution. They also find that characteristics of people who become poor because of the crisis are different from those of both chronically poor people and the general population. The findings can be useful for policy makers wishing to identify leading monitoring indicators to track the impact of macroeconomic shocks and to design policies that protect vulnerable groups.
  • Publication
    Assessing Ex Ante the Poverty and Distributional Impact of the Global Crisis in a Developing Country : A Micro-simulation Approach with Application to Bangladesh
    (2010-03-01) Habib, Bilal; Narayan, Ambar; Olivieri, Sergio; Sanchez-Paramo, Carolina
    Measuring the poverty and distributional impact of the global crisis for developing countries is not easy, given the multiple channels of impact and the limited availability of real-time data. Commonly-used approaches are of limited use in addressing questions like who are being affected by the crisis and by how much, and who are vulnerable to falling into poverty if the crisis deepens? This paper develops a simple micro-simulation method, modifying models from existing economic literature, to measure the poverty and distributional impact of macroeconomic shocks by linking macro projections with pre-crisis household data. The approach is then applied to Bangladesh to assess the potential impact of the slowdown on poverty and income distribution across different groups and regions. A validation exercise using past data from Bangladesh finds that the model generates projections that compare well with actual estimates from household data. The results can inform the design of crisis monitoring tools and policies in Bangladesh, and also illustrate the kind of analysis that is possible in other developing countries with similar data availability.
  • Publication
    The Impact of the Financial Crisis on Poverty and Income Distribution : Insights from Simulations in Selected Countries
    (World Bank, Washington, DC, 2010-03) Habib, Bilal; Narayan, Ambar; Olivieri, Sergio; Sanchez, Carolina
    As the financial crisis has spread through the world, the lack of real-time data has made it difficult to track its impact in developing countries. The authors use a micro-simulation approach to assess the poverty and distributional effects of the crisis. In Bangladesh, Mexico, and the Philippines, the authors find increases in both the level and the depth of aggregate poverty. Income shocks are relatively large in the middle (and, in Mexico, the bottom) parts of the income distribution. The authors also find that characteristics of people who become poor because of the crisis are different from those of both chronically poor people and the general population. Findings will be useful for policy makers wishing to identify leading monitoring indicators to track the impact of macroeconomic shocks and to design policies that protect vulnerable groups.
  • Publication
    Changes in Returns to Education in Latin America : The Role of Demand and Supply of Skills
    (2010) Manacorda, Marco; Sanchez-Paramo, Carolina; Schady, Norbert
    Using micro data for the urban areas of Argentina, Brazil, Chile, Colombia, and Mexico, the authors document trends in men's returns to education during the 1980s and the 1990s and estimate the role of supply and demand factors in explaining the changes in skill premia. They propose a model of demand for skills with three production inputs, corresponding to workers with primary-, secondary-, and university-level education. Further, the authors demonstrate that an unprecedented rise in the supply of workers having completed secondary-level education depressed their wages relative to workers with primary-level education throughout Latin America. This supply shift was compounded by a generalized shift in the demand for workers with tertiary education.