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Poverty targeting in public programs: A comparison of alternative nonparametric methods

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  • Isha Dewan

    (Indian Statistical Institute, New Delhi)

  • Rohini Somanathan

    (Indian Statistical Institute, New Delhi)

Abstract

Very poor households may be excluded from public programs intended for their benefit for a variety of reasons as lack information, a permanent residence or membershiip in social networks. We are interested in methods of testing for such exclusion based on independently drawn samples of program participants and non-participants. We discuss three alternative nonparametric procedures; sign tests, tests for stochastic dominance and a test for distribution crossing. In the cases where there is a poverty threshold below which program participation is difficult, our simulation results suggests that the last of these test procedures is the most powrful. we apply this test to data from a microfinance program in India and find evidence that the poorest households in the area were largely outside the program.

Suggested Citation

  • Isha Dewan & Rohini Somanathan, 2004. "Poverty targeting in public programs: A comparison of alternative nonparametric methods," Discussion Papers 04-16, Indian Statistical Institute, Delhi.
    • Handle: RePEc:alo:isipdp:04-16
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    References listed on IDEAS

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    Cited by:

    1. Sagarika Dey, 2017. "Assessing the Poverty Impact of India’s Largest Livelihood Security Programme: A Study Based on 68th Round of NSSO," Journal of Development Policy and Practice, , vol. 2(1), pages 56-70, January.
    2. Jean-Marie Baland & Rohini Somanathan & Lore Vandewalle, 2019. "Socially Disadvantaged Groups and Microfinance in India," Economic Development and Cultural Change, University of Chicago Press, vol. 67(3), pages 537-569.

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