Putting Your Money Where Your Mouth Is : Geographic Targeting of World Bank Projects to the Bottom 40 Percent
The adoption of the shared prosperity goal by the World Bank in 2013 and Sustainable Development Goal 10, on inequality, by the United Nations in 2015 should strengthen the focus of development interventions and cooperation on the income growth of...
| Main Authors: | , , , , |
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| Language: | English |
| Published: |
World Bank, Washington, DC
2017
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| Subjects: | |
| Online Access: | http://documents.worldbank.org/curated/en/228631511203979027/Putting-your-money-where-your-mouth-is-geographic-targeting-of-World-Bank-projects-to-the-bottom-40-percent http://hdl.handle.net/10986/28908 |
| Summary: | The adoption of the shared prosperity
goal by the World Bank in 2013 and Sustainable Development
Goal 10, on inequality, by the United Nations in 2015 should
strengthen the focus of development interventions and
cooperation on the income growth of the bottom 40 percent of
the income distribution (the bottom 40). However, little is
known about within-country allocation patterns among the
projects of development institutions. This paper proposes a
new geographic targeting indicator and related methodology
to assess the within-country aid allocations of donors by
correlating the distribution of funding within countries
with the geographical distribution of the bottom 40.
Applying this methodology to World Bank funding for projects
approved over 2005-14 shows that, of the 58 countries in the
sample, 42 exhibit a positive correlation between the shares
of the bottom 40 and World Bank funding, and, in almost half
of these, the correlation is above 0.5. Slightly more than a
quarter of the countries, mostly in Sub-Saharan Africa,
exhibit a negative correlation. The presence of the bottom
40 is typically correlated with the population size of an
administrative area. A regression analysis shows that,
controlling for population, the correlation between the
bottom 40 and World Bank funding switches sign and becomes
significant and negative on average. This is entirely driven
by Sub-Saharan Africa, because the correlation is
insignificant in the rest of the world regions. Hence, the
significant and positive correlation in the estimations
without controlling for population suggests that World Bank
project funding is concentrated in administrative areas in
which more people live (including the bottom 40) rather than
in poorer administrative areas. |
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