Publication:
Assessing Poverty and Distributional Impacts of the Global Crisis in the Philippines : A Microsimulation Approach

Loading...
Thumbnail Image
Files in English
English PDF (1.11 MB)
544 downloads
English Text (165.36 KB)
75 downloads
Published
2010-04-01
ISSN
Date
2012-03-19
Editor(s)
Abstract
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.
Link to Data Set
Citation
Habib, Bilal; Narayan, Ambar; Olivieri, Sergio; Sanchez-Paramo, Carolina. 2010. Assessing Poverty and Distributional Impacts of the Global Crisis in the Philippines : A Microsimulation Approach. Policy Research working paper ; no. WPS 5286. © World Bank. http://hdl.handle.net/10986/3773 License: CC BY 3.0 IGO.
Associated URLs
Associated content
Report Series
Report Series
Other publications in this report series
  • Publication
    The Economic Value of Weather Forecasts: A Quantitative Systematic Literature Review
    (Washington, DC: World Bank, 2025-09-10) Farkas, Hannah; Linsenmeier, Manuel; Talevi, Marta; Avner, Paolo; Jafino, Bramka Arga; Sidibe, Moussa
    This study systematically reviews the literature that quantifies the economic benefits of weather observations and forecasts in four weather-dependent economic sectors: agriculture, energy, transport, and disaster-risk management. The review covers 175 peer-reviewed journal articles and 15 policy reports. Findings show that the literature is concentrated in high-income countries and most studies use theoretical models, followed by observational and then experimental research designs. Forecast horizons studied, meteorological variables and services, and monetization techniques vary markedly by sector. Estimated benefits even within specific subsectors span several orders of magnitude and broad uncertainty ranges. An econometric meta-analysis suggests that theoretical studies and studies in richer countries tend to report significantly larger values. Barriers that hinder value realization are identified on both the provider and user sides, with inadequate relevance, weak dissemination, and limited ability to act recurring across sectors. Policy reports rely heavily on back-of-the-envelope or recursive benefit-transfer estimates, rather than on the methods and results of the peer-reviewed literature, revealing a science-to-policy gap. These findings suggest substantial socioeconomic potential of hydrometeorological services around the world, but also knowledge gaps that require more valuation studies focusing on low- and middle-income countries, addressing provider- and user-side barriers and employing rigorous empirical valuation methods to complement and validate theoretical models.
  • Publication
    The Macroeconomic Implications of Climate Change Impacts and Adaptation Options
    (Washington, DC: World Bank, 2025-05-29) Abalo, Kodzovi; Boehlert, Brent; Bui, Thanh; Burns, Andrew; Castillo, Diego; Chewpreecha, Unnada; Haider, Alexander; Hallegatte, Stephane; Jooste, Charl; McIsaac, Florent; Ruberl, Heather; Smet, Kim; Strzepek, Ken
    Estimating the macroeconomic implications of climate change impacts and adaptation options is a topic of intense research. This paper presents a framework in the World Bank's macrostructural model to assess climate-related damages. This approach has been used in many Country Climate and Development Reports, a World Bank diagnostic that identifies priorities to ensure continued development in spite of climate change and climate policy objectives. The methodology captures a set of impact channels through which climate change affects the economy by (1) connecting a set of biophysical models to the macroeconomic model and (2) exploring a set of development and climate scenarios. The paper summarizes the results for five countries, highlighting the sources and magnitudes of their vulnerability --- with estimated gross domestic product losses in 2050 exceeding 10 percent of gross domestic product in some countries and scenarios, although only a small set of impact channels is included. The paper also presents estimates of the macroeconomic gains from sector-level adaptation interventions, considering their upfront costs and avoided climate impacts and finding significant net gross domestic product gains from adaptation opportunities identified in the Country Climate and Development Reports. Finally, the paper discusses the limits of current modeling approaches, and their complementarity with empirical approaches based on historical data series. The integrated modeling approach proposed in this paper can inform policymakers as they make proactive decisions on climate change adaptation and resilience.
  • Publication
    Labor Demand in the Age of Generative AI: Early Evidence from the U.S. Job Posting Data
    (Washington, DC: World Bank, 2025-11-18) Liu, Yan; Wang, He; Yu, Shu
    This paper examines the causal impact of generative artificial intelligence on U.S. labor demand using online job posting data. Exploiting ChatGPT’s release in November 2022 as an exogenous shock, the paper applies difference-in-differences and event study designs to estimate the job displacement effects of generative artificial intelligence. The identification strategy compares labor demand for occupations with high versus low artificial intelligence substitution vulnerability following ChatGPT’s launch, conditioning on similar generative artificial intelligence exposure levels to isolate substitution effects from complementary uses. The analysis uses 285 million job postings collected by Lightcast from the first quarter of 2018 to the second quarter of 2025Q2. The findings show that the number of postings for occupations with above-median artificial intelligence substitution scores fell by an average of 12 percent relative to those with below-median scores. The effect increased from 6 percent in the first year after the launch to 18 percent by the third year. Losses were particularly acute for entry-level positions that require neither advanced degrees (18 percent) nor extensive experience (20 percent), as well as those in administrative support (40 percent) and professional services (30 percent). Although generative artificial intelligence generates new occupations and enhances productivity, which may increase labor demand, early evidence suggests that some occupations may be less likely to be complemented by generative artificial intelligence than others.
  • Publication
    The Lasting Effects of Working while in School
    (Washington, DC: World Bank, 2025-08-18) Ferrando, Mery; Katzkowicz, Noemi; Le Barbanchon, Thomas; Ubfal, Diego
    This paper provides the first experimental evidence on the long-term effects of work-study programs, leveraging a randomized lottery design from a national program in Uruguay. Participation leads to a persistent 11 percent increase in formal labor earnings, observable seven years after the program. Effects are stronger for youth who participate during pivotal educational transitions and are larger for vulnerable youth and men, while remaining positive for women and non-vulnerable youth. The program is highly cost-effective, with average impacts exceeding those of job training programs and comparable to early childhood investments.
  • Publication
    It’s Not (Just) the Tariffs: Rethinking Non-Tariff Measures in a Fragmented Global Economy
    (Washington, DC: World Bank, 2025-10-22) Taglioni, Daria; KEE, Hiau Looi
    As tariffs have declined, non-tariff measures (NTMs) have become central to trade policy, especially in high-income countries and regulated sectors like food and green technologies. Although NTMs may serve legitimate goals, they could also sort countries and firms into or out of markets based on compliance capacity and differences in product mix. Documenting recent advances in the estimation of ad valorem equivalents (AVEs), this paper uncovers new patterns of use and exposure of NTMs. High-income countries rely more heavily on NTMs relative to tariffs, while low- and middle-income countries face steeper AVEs on their exports. Firm-level evidence shows that NTMs disproportionately affect smaller firms, leading to market exit and concentration. Poorly designed NTMs can harm productivity and welfare, while coordinated, capacity-aware use can deliver inclusive outcomes. Policy design, transparency, and diagnostics must evolve to reflect the growing role—and risks—of NTMs in a fragmented global trade landscape.
Journal
Journal Volume
Journal Issue

Related items

Showing items related by metadata.

  • Publication
    Azerbaijan : Living Conditions Assessment Report
    (World Bank, 2010-03-01) World Bank
    Azerbaijan saw a substantial reduction in poverty during the 2000s, owing to significant economic growth and policies and programs that improved the distribution of wealth. Seizing the opportunity afforded by the oil boom, Azerbaijan initiated large public sector investment programs and supportive policies to increase wages and social protection transfers to the population, and institutional reforms aimed at modernizing the economy. These efforts translated into double-digit growth and an impressive reduction in poverty. The report underscores that the government's targeted social assistance program has been successful in channeling public transfers to the most needy. On the other hand, high dependence on oil revenues, compounded by the current global economic crisis, presents challenges to maintaining growth and could jeopardize the gains made in poverty reduction. Moreover, while Azerbaijan has made significant progress in building capacity to redistribute the benefits of growth, significant challenges remain in developing the human capital of the population to participate actively in future growth and to close the productivity gap with its comparators in the post crisis world.
  • 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
    Romania : Poverty Monitoring Analytical and Advisory Assistance Program, First Phase Report, Fiscal Year 2007
    (Washington, DC, 2007-11) World Bank
    The objective of this report is to contribute towards institutional capacity building for regular monitoring and analysis of poverty, as well as other indicators of living conditions and social inclusion. This report analyzes the poverty trends and profile using the national absolute poverty line, which measures changes in the level of welfare and allows for a more straightforward interpretation of comparisons over time. Chapter 1 presents an overview of poverty dynamics using both relative and absolute measures of poverty, and explores the reasons for the observed difference in trends between the two measures. Chapter 2 investigates the relationship between economic growth, inequality and poverty in Romania during the period 1995 and 2006.
  • Publication
    Uganda - Promoting Inclusive Growth : Transforming Farms, Human Capital, and Economic Geography, Synthesis Report
    (Washington, DC, 2012-02) World Bank
    At an average above 6.0 percent per year over the past two decades, Uganda' s growth rate was impressive by all standards. In parallel, poverty declined significantly, not only in urban areas, but also to some extent within the rural areas. This combination was possible because the key drivers of growth were labor-intensive services sectors, some of which are agriculture based. In fact, Uganda's growth process has reduced overall poverty faster than what has been observed in many other developing countries. This report addresses the issue from a double perspective: sectoral and geographical. From a sectoral perspective, it concludes that the agricultural sector needs transformation because it remains the primary employer; it is the country's main comparative advantage and bedrock for industrialization. More broadly, identifying sectors with potential will be important for employment opportunities, which in turn will be largely dependent on productivity levels and thus on the level of education and skills of the labor force. From a geographical perspective, transformation generally yields a concentration of economic activities that leaves some locations lagging in prosperity. This unbalanced growth needs to be supported with appropriate economic integration policies that have been analyzed in the report.
  • Publication
    Turkey : Economic Reforms, Living Standards and Social Welfare Study
    (Washington, DC, 2000-01-27) World Bank
    As Turkey faces the 21st century, it must confront a series of critical policy questions: Can it continue to make progress in the fight against poverty? Is it possible to accelerate this improvement, which given Turkish growth rates, has been disappointing? What needs to be done to ensure that GDP growth pays off in terms of broad-based increases in employment and wages? Is it realistic to envision a future growth path in which 40 percent of employment remains in the agriculture sector? Can the widening of disparities between regions somehow be reversed? This report recommends the key elements of a strategy to improve living standards and reduce poverty include: 1) Provide a macroeconomic environment that is conducive to growth and price stability. 2) Remove biases against employment creation outside of agriculture. 3) Facilitate the outflow of resources from agriculture and provide a basis for productivity growth in the sector. 4) Invest in education, and especially in that or poor children. 5) Reallocate Government expenditures so that they are better targeted to the economically vulnerable.

Users also downloaded

Showing related downloaded files

  • Publication
    The Government Analytics Handbook
    (Washington, DC: World Bank, 2023-09-28) Rogger, Daniel; Schuster, Christian
    The Government Analytics Handbook presents frontier evidence and practitioner insights on how to leverage data to strengthen public administration. Covering a range of microdata sources—such as administrative data and public servant surveys—as well as tools and resources for undertaking the analytics, it transforms the ability of governments to take a data-informed approach to diagnose and improve how public organizations work. The "Handbook" is a must-have for practitioners, policy makers, academics, and government agencies. It is available as a single volume in print or digital formats, and as chapters for modular use. Additional tools, data and background information are available at worldbank.org/governmentanalytics. “Governments have long been assessed using aggregate governance indicators, giving us little insight into their diversity and how they can practically be improved. This pioneering handbook shows how microdata can be used to give scholars and practitioners granular and real insights into how states work, and practical guidance on the process of state-building.” —Francis Fukuyama, Stanford University, author of State-Building: Governance and World Order in the 21st Century - "The Government Analytics Handbook is the most comprehensive work on practically building government administration I have ever seen, helping practitioners to change public administration for the better.” —Francisco Gaetani, Special Secretary for State Transformation, Government of Brazil - “The machinery of the state is central to a country’s prosperity. This handbook provides insights and methodological tools for creating a better shared understanding of the realities of a state, to support the redesign of institutions, and improve the quality of public administration.” —James Robinson, University of Chicago, coauthor of Why Nations Fail
  • Publication
    Digital Progress and Trends Report 2023
    (Washington, DC: World Bank, 2024-03-05) World Bank
    Digitalization is the transformational opportunity of our time. The digital sector has become a powerhouse of innovation, economic growth, and job creation. Value added in the IT services sector grew at 8 percent annually during 2000–22, nearly twice as fast as the global economy. Employment growth in IT services reached 7 percent annually, six times higher than total employment growth. The diffusion and adoption of digital technologies are just as critical as their invention. Digital uptake has accelerated since the COVID-19 pandemic, with 1.5 billion new internet users added from 2018 to 2022. The share of firms investing in digital solutions around the world has more than doubled from 2020 to 2022. Low-income countries, vulnerable populations, and small firms, however, have been falling behind, while transformative digital innovations such as artificial intelligence (AI) have been accelerating in higher-income countries. Although more than 90 percent of the population in high-income countries was online in 2022, only one in four people in low-income countries used the internet, and the speed of their connection was typically only a small fraction of that in wealthier countries. As businesses in technologically advanced countries integrate generative AI into their products and services, less than half of the businesses in many low- and middle-income countries have an internet connection. The growing digital divide is exacerbating the poverty and productivity gaps between richer and poorer economies. The Digital Progress and Trends Report series will track global digitalization progress and highlight policy trends, debates, and implications for low- and middle-income countries. The series adds to the global efforts to study the progress and trends of digitalization in two main ways: · By compiling, curating, and analyzing data from diverse sources to present a comprehensive picture of digitalization in low- and middle-income countries, including in-depth analyses on understudied topics. · By developing insights on policy opportunities, challenges, and debates and reflecting the perspectives of various stakeholders and the World Bank’s operational experiences. This report, the first in the series, aims to inform evidence-based policy making and motivate action among internal and external audiences and stakeholders. The report will bring global attention to high-performing countries that have valuable experience to share as well as to areas where efforts will need to be redoubled.
  • Publication
    Global Economic Prospects, June 2025
    (Washington, DC: World Bank, 2025-06-10) World Bank
    The global economy is facing another substantial headwind, emanating largely from an increase in trade tensions and heightened global policy uncertainty. For emerging market and developing economies (EMDEs), the ability to boost job creation and reduce extreme poverty has declined. Key downside risks include a further escalation of trade barriers and continued policy uncertainty. These challenges are exacerbated by subdued foreign direct investment into EMDEs. Global cooperation is needed to restore a more stable international trade environment and scale up support for vulnerable countries grappling with conflict, debt burdens, and climate change. Domestic policy action is also critical to contain inflation risks and strengthen fiscal resilience. To accelerate job creation and long-term growth, structural reforms must focus on raising institutional quality, attracting private investment, and strengthening human capital and labor markets. Countries in fragile and conflict situations face daunting development challenges that will require tailored domestic policy reforms and well-coordinated multilateral support.
  • Publication
    Working Without Borders
    (Washington, DC: World Bank, 2023-07-24) Datta, Namita; Rong, Chen; Singh, Sunamika; Stinshoff, Clara; Iacob, Nadina; Nigatu, Natnael Simachew; Nxumalo, Mpumelelo; Klimaviciute, Luka
    Online gig work poses both opportunities and challenges for governments and workers. On the upside, it offers prospects for income generation, especially in developing countries, where most people work in low-productivity, low-quality, often informal jobs. The virtual and often temporary nature of gig work also provides flexibility for often neglected groups such as women, youth, migrants, and people with disabilities. These jobs could be a stepping-stone to bet¬ter-quality jobs for low-skilled workers by helping them learn critical digital skills and close the digital divide. But most gig jobs offer little to no protection for workers, with uncertain income streams and no clear career pathways. Depending on local labor regulations, many gig workers are not protected against unfair practices, abuse or injuries while working. Gig work also raises challenges for managing data security and privacy. The report examines how countries can navigate the promise and perils of online gig work. It reveals that the online gig workforce is much larger than previously assumed with an estimated 154 million to 435 million Online gig workers around the globe. For the first time ever, the report mapped and tracked regional platforms and gig workers who work in languages other than English. Key messages are: • Online gig work is expanding, accounting for up to 12% of the global labor force and is a growing source of income for millions. • Demand for online gig workers is rising faster in developing countries than in industrialized countries. • Local gig platforms play a vital role in the local labor market, but they face challenges in establishing a viable business model, and opportunities for long-term growth. • Online gig work can support inclusion by providing work opportunities for youth, women, and low-skilled workers. • Gig workers, like most other informal sector workers in developing countries, are often outside the purview of labor regulations. • The gig economy can offer opportunities locally to build digital skills, increase income-earning opportunities, and facilitate social protection coverage of informal workers.
  • Publication
    Global Economic Prospects, January 2025
    (Washington, DC: World Bank, 2025-01-16) World Bank
    Global growth is expected to hold steady at 2.7 percent in 2025-26. However, the global economy appears to be settling at a low growth rate that will be insufficient to foster sustained economic development—with the possibility of further headwinds from heightened policy uncertainty and adverse trade policy shifts, geopolitical tensions, persistent inflation, and climate-related natural disasters. Against this backdrop, emerging market and developing economies are set to enter the second quarter of the twenty-first century with per capita incomes on a trajectory that implies substantially slower catch-up toward advanced-economy living standards than they previously experienced. Without course corrections, most low-income countries are unlikely to graduate to middle-income status by the middle of the century. Policy action at both global and national levels is needed to foster a more favorable external environment, enhance macroeconomic stability, reduce structural constraints, address the effects of climate change, and thus accelerate long-term growth and development.