Kyrgyz Republic: Minimum Living Standards and Alternative Targeting Methods for Social Transfers

Type Report
Title Kyrgyz Republic: Minimum Living Standards and Alternative Targeting Methods for Social Transfers
Publication (Day/Month/Year) 2013
Publisher World Bank
City Washington, DC

The objective of this report is twofold: first, analyze and discuss the linkages between different minimum standards currently used in the Kyrgyz Republic and with the Monthly Benefit for Poor Families (MBPF), and, secondly, to analyze the potential of alternative targeting methods and benefit levels. The analysis in this report mainly draws on data from the Kyrgyz Integrated Household Survey (KIHS) 2010. The report is structured as follows: the next section analyzes and compares different minimum living standards as currently used in the Kyrgyz Republic. Subsequently, we simulate different targeting options using static micro-simulation. Categorical targeting, proxy-means testing and the current means-test given a higher Guaranteed Minimum Income (GMI) are analyzed and eventually compared in terms of cost efficiency. The last section concludes. One of the objectives of the Strategy for Social Protection Development 2012-2014 of the Government of the Kyrgyz Republic (GoKG) is to improve the targeting performance of the MBPF. The MBPF is the only last-resort social transfer program in the Kyrgyz Republic aimed at providing a guaranteed minimum income to the population. Currently, eligibility for the MBPF is determined by a means-test. A second objective of the strategy, which is closely linked to the first, aims at improving the poverty reduction effectiveness of the transfer. The size of the MBPF is defined by the difference between family income per capita and the level of the GMI. The main purpose of a national poverty line is to analyze they extent and nature of poverty in the country, and to assess the (distributional) outcomes of public policies. The objective of the food poverty line is to identify the extremely poor households and individuals in the society.

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