Estimation of rates of return on social protection: Ex ante micro-simulation of social transfers in Cambodia

A. Mideros; F. Gassmann; P. Mohnen

doi:10.1080/19439342.2015.1025815

Estimation of rates of return on social protection: Ex ante micro-simulation of social transfers in Cambodia

A. Mideros^*, F. Gassmann, P. Mohnen

^*Corresponding author for this work

Research output: Contribution to journal › Article › Academic › peer-review

Abstract

This study estimates the rates of return of non-contributory social transfer programmes in Cambodia using household-level data and going beyond standard cost–efficiency analyses by developing a dynamic microsimulation model. It shows that social protection promotes equitable economic growth by enhancing human capital and fostering economic performance at the micro level. A positive rate of return is achieved after 12 periods and can reach between 12 per cent and 15 per cent after 20 periods. This study shows that microsimulation models can be extended in order to analyse the long-term economic returns on social protection. © 2015 Taylor & Francis.

Original language	English
Pages (from-to)	67-86
Number of pages	20
Journal	Journal of Development Effectiveness
Volume	8
Issue number	1
DOIs	https://doi.org/10.1080/19439342.2015.1025815
Publication status	Published - 2016

JEL classifications

d69 - Welfare Economics: Other
j24 - "Human Capital; Skills; Occupational Choice; Labor Productivity"
o40 - Economic Growth and Aggregate Productivity: General
o15 - "Economic Development: Human Resources; Human Development; Income Distribution; Migration"

Keywords

Cambodia
microsimulation
rate of return
social protection
social transfers
computer simulation
economic growth
estimation method
human capital
social policy
MATTERS
CASH TRANSFERS
OPORTUNIDADES
MEXICO
POVERTY
INCOME
PROGRAMS

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10.1080/19439342.2015.1025815

Cite this

@article{96bae37668cb481c8d08176f0d04a6b2,

title = "Estimation of rates of return on social protection: Ex ante micro-simulation of social transfers in Cambodia",

abstract = "This study estimates the rates of return of non-contributory social transfer programmes in Cambodia using household-level data and going beyond standard cost–efficiency analyses by developing a dynamic microsimulation model. It shows that social protection promotes equitable economic growth by enhancing human capital and fostering economic performance at the micro level. A positive rate of return is achieved after 12 periods and can reach between 12 per cent and 15 per cent after 20 periods. This study shows that microsimulation models can be extended in order to analyse the long-term economic returns on social protection. {\textcopyright} 2015 Taylor & Francis.",

keywords = "Cambodia, microsimulation, rate of return, social protection, social transfers, computer simulation, economic growth, estimation method, human capital, social policy, MATTERS, CASH TRANSFERS, OPORTUNIDADES, MEXICO, POVERTY, INCOME, PROGRAMS",

author = "A. Mideros and F. Gassmann and P. Mohnen",

note = "No data used. Export Date: 25 May 2016 Correspondence Address: Mideros, A.; Maastricht Graduate School of Governance, UNU-MERIT, Keizer Karelplein 19, Netherlands; email: [email protected] Funding Details: UNICEF References: Akresh, R., De Walque, D., Kazianga, H., Cash Transfers and Child Schooling: Evidence from a Randomized Evaluation of the Role of Conditionality (2013) Policy Research Working Paper 6340, , World Bank; Alderman, H., Yemtsov, R., Productive Role of Safety Nets (2012) Social Protection and Labour Discussion Paper 1203, , http://www.worldbank.org/, The World Bank; Andrews, C., Das, M., Elder, J., Ovadiya, M., Zampaglione, G., Social Protection in Low Income Countries and Fragile Situations (2012) Social Protection and Labour Discussion Paper 1209, , http://www.worldbank.org/, Washington, DC: World Bank; Arnold, C., Conway, T., Greenslade, M., Cash Transfers (2011) Evidence Paper, , London: Department for International Development; Barrientos, A., (2005) Non-Contributory Pensions and Poverty Reduction in Brazil and South Africa, , http://www.sed.manchester.ac.uk/, Manchester: IDPM, University of Manchester; Barrientos, A., Social Transfers and Growth: What Do We Know? What Do We Need to Find Out? (2012) World Development, 40 (1), pp. 11-20; Barrientos, A., Scott, J., Social Transfers and Growth: A Review (2008) BWPI Working Paper 52, , http://www.bwpi.manchester.ac.uk/, Manchester: Brooks World Poverty Institute; Bourguignon, F., Ferreira, F., Ex Ante Evaluation of Policy Reforms Using Behavioural Models (2003) The Impact of Economic Policies on Poverty and Income Distribution: Evaluation Techniques and Tools, pp. 123-141. , Pereira Da Silva L., Bourguignon F., (eds), New York: World Bank and Oxford University Press; Bourguignon, F., Ferreira, F.H., Leite, P.G., Conditional Cash Transfers, Schooling, and Child Labour: Micro-Simulating Brazil{\textquoteright}s Bolsa Escola Program (2003) The World Bank Economic Review, 17 (2), pp. 229-254; Bourguignon, F., Spadaro, A., Microsimulation as a Tool for Evaluating Redistribution Policies (2006) TheJournal of Economic Inequality, 4 (1), pp. 77-106; (2012) Nutrition Library, , http://sites.google.com/site/camnutlibrary/data, February; Cherrier, C., Gassmann, F., Mideros, A., Mohnen, P., Making the Investment Case for Social Protection. Methodological Challenges with Lessons Learnt from a Recent Study in Cambodia (2013) Working Paper 2013-06, , http://www.unicef-irc.org/, Florence: UNICEF Office of Research; Cury, S., Pedrozo, E., Mori Coelho, A., Callegari, I., The Impacts of Income Transfer programs on Income Distribution and Poverty in Brazil: An Integrated Microsimulation and Computable General Equilibrium Analysis (2010) MPIA Working Paper 2010-20, , http://portal.pep-net.org/, Partnership for Economic Policy – Modeling and Policy Impact Analysis; Debowicz, D., Golan, J., The Impact of Oportunidades on Human Capital and Income Distribution in Mexico: A Top-Down/Bottom-Up Approach (2014) Journal of Policy Modeling, 36 (1), pp. 24-42; (2011) Financing Social Pensions in Low and Middle Income Countries, , London: Help Age International Briefing; Hennicot, J.C., (2012) Financial Assessment of the National Social Protection Strategy for the Poor and Vulnerable Draft v.2, , Phnom Penh: International Labour Organization; Jolliffe, D., Whose Education Matter in the Determination of Household Income? Evidence from a Developing Country (2002) Economic Development and Cultural Change, 50 (2), pp. 287-312; Kagin, J., Taylor, E., Alfani, D., Davis, B., (2014) Local Economy-Wide Impact Evaluation (LEWIE) of Ethiopia{\textquoteright}s Social Cash Transfer Pilot Programme, , http://www.fao.org/, Rome: Food and Agriculture Programme (FAO); Khondker, B.H., Knox-Vydmanov, C., Vilela, A., (2013) Old Age Social Protection Options for Bangladesh, , Dhaka: Bureau of Economic Research Dhaka University and Help Age International; Levy, S., Robinson, S., Can Cash Transfers Promote the Local Economy? (2014) Discussion Paper 01334, , http://www.ifpri.org/, Washington, DC: IFPRI; Li, J., O{\textquoteright}Donoghue, C., A Survey of Dynamic Microsimulation Models: Uses, Model Structure and Methodology (2013) International Journal of Microsimulation, 6 (2), pp. 3-55. , http://www.microsimulation.org/; McKee, D., Todd, P., The Longer-Term Effects of Human Capital Enrichment Programs on Poverty and Inequality: Oportunidades in Mexico (2011) Estudios De Econom{\'i}a, 38 (1), pp. 67-100; Mideros, A., Gassmann, F., Mohnen, P., Estimation of Rates of Return on Social Protection: Making the Case for Non-Contributory Social Transfers in Cambodia (2013) Working Paper 2013-063, , http://www.merit.unu.edu/, Maastricht: UNU-MERIT and Maastricht Graduate School of Governance; (2009) General Population Census of Cambodia 2008, , Phnom Penh: Royal Government of Cambodia, Ministry of Planning; (2010) Cambodia Socio-Economic Survey 2009, , Phnom Penh: Royal Government of Cambodia, Ministry of Planning; (2010) Labour and Social Trends in Cambodia, , Phnom Penh: Royal Government of Cambodia, Ministry of Planning; (2011) National Accounts of Cambodia 1993-2000, , Phnom Penh: Royal Government of Cambodia, Ministry of Planning; (2011) Report 12. Population Projections of Cambodia, , Phnom Penh: Royal Government of Cambodia, Ministry of Planning; Notten, G., Gassmann, F., Size Matters: Targeting Efficiency and Poverty Reduction Effects of Means-tested and Universal Child Benefits in Russia (2008) Journal of European Social Policy, 18 (3), pp. 260-274; Ponce, J., Bedi, A., The Impact of a Cash Transfer Program on Cognitive Achievement: The Bono De Desarrollo Humano of Ecuador (2010) Economicsof Education Review, 29 (1), pp. 116-125; (2008) Rectangular Strategy for Growth, Employment, Equity and Efficiency. Phase II, , Phnom Penh: Royal Government of Cambodia; (2009) National Strategic Development Plan. Update 2009-2013, , Phnom Penh: Royal Government of Cambodia; Sadoulet, E., De Janvry, A., Davis, B., Cash Transfer Programs with Income Multipliers: PROCAMPO in Mexico (2001) World Development, 29 (6), pp. 1043-1056; Schady, N., Araujo, M.C., Cash Transfers, Conditions, School Enrolment and Child Work: Evidence from a Randomized Experiment in Ecuador (2006) Policy Research Working Paper 3930, , http://www.worldbank.org/, Washington, DC: World Bank; Schady, N., Rosero, J., Are Cash Transfers Made to Women Spent like Other Sources of Income? (2008) Economics Letters, 101 (3), pp. 246-248; Taylor, E., Kagin, J., Filipski, M., Thome, K., (2013) Evaluating General Equilibrium Impacts of Kenya{\textquoteright}s Cash Transfer Programme for Orphans and Vulnerable Children (CT-OVC), , http://www.fao.org/, Rome: Food and Agriculture Organization (FAO); Taylor, E., Thome, K., Filipski, M., (2014) Evaluating Local General Equilibrium Impacts of Lesotho{\textquoteright}s Child Grants Programme, , http://www.fao.org/, Rome: Food and Agriculture Organization (FAO); Thome, K., Filipski, M., Kagin, J., Taylor, J.E., Davis, B., Agricultural Spillover Effects of Cash Transfers: What Does LEWIE Have to Say (2013) American Journal of Agricultural Economics, 95 (5), pp. 1338-1344; Thome, K., Taylor, E., Kagin, J., Davis, B., Barko Osei, R., Osei-Akoto, I., (2014) Local Economy-wide Impact Evaluation (LEWIE) of Ghana{\textquoteright}s Livelihood Empowerment Against Poverty (LEAP) Programme, , http://www.fao.org/, Rome: Food and Agriculture Organization (FAO); (2011) Human Development Report 2011. Sustainability and Equity: A Better Future for All, , New York: United Nations Development Programme; (2012) Integrated Social Protection Systems. Enhancing Equity for Children, , New York: United Nations Children{\textquoteright}s Fund; Villa, J.M., Social Transfers and Growth. the Missing Evidence Crom Luminosity Data (2014) Working Paper 2014/09, , http://www.wider.unu.edu/, Helsinki: UNU-WIDER",

year = "2016",

doi = "10.1080/19439342.2015.1025815",

language = "English",

volume = "8",

pages = "67--86",

journal = "Journal of Development Effectiveness",

issn = "1943-9342",

publisher = "Routledge/Taylor & Francis Group",

number = "1",

}

TY - JOUR

T1 - Estimation of rates of return on social protection

T2 - Ex ante micro-simulation of social transfers in Cambodia

AU - Mideros, A.

AU - Gassmann, F.

AU - Mohnen, P.

N1 - No data used. Export Date: 25 May 2016 Correspondence Address: Mideros, A.; Maastricht Graduate School of Governance, UNU-MERIT, Keizer Karelplein 19, Netherlands; email: [email protected] Funding Details: UNICEF References: Akresh, R., De Walque, D., Kazianga, H., Cash Transfers and Child Schooling: Evidence from a Randomized Evaluation of the Role of Conditionality (2013) Policy Research Working Paper 6340, , World Bank; Alderman, H., Yemtsov, R., Productive Role of Safety Nets (2012) Social Protection and Labour Discussion Paper 1203, , http://www.worldbank.org/, The World Bank; Andrews, C., Das, M., Elder, J., Ovadiya, M., Zampaglione, G., Social Protection in Low Income Countries and Fragile Situations (2012) Social Protection and Labour Discussion Paper 1209, , http://www.worldbank.org/, Washington, DC: World Bank; Arnold, C., Conway, T., Greenslade, M., Cash Transfers (2011) Evidence Paper, , London: Department for International Development; Barrientos, A., (2005) Non-Contributory Pensions and Poverty Reduction in Brazil and South Africa, , http://www.sed.manchester.ac.uk/, Manchester: IDPM, University of Manchester; Barrientos, A., Social Transfers and Growth: What Do We Know? What Do We Need to Find Out? (2012) World Development, 40 (1), pp. 11-20; Barrientos, A., Scott, J., Social Transfers and Growth: A Review (2008) BWPI Working Paper 52, , http://www.bwpi.manchester.ac.uk/, Manchester: Brooks World Poverty Institute; Bourguignon, F., Ferreira, F., Ex Ante Evaluation of Policy Reforms Using Behavioural Models (2003) The Impact of Economic Policies on Poverty and Income Distribution: Evaluation Techniques and Tools, pp. 123-141. , Pereira Da Silva L., Bourguignon F., (eds), New York: World Bank and Oxford University Press; Bourguignon, F., Ferreira, F.H., Leite, P.G., Conditional Cash Transfers, Schooling, and Child Labour: Micro-Simulating Brazil’s Bolsa Escola Program (2003) The World Bank Economic Review, 17 (2), pp. 229-254; Bourguignon, F., Spadaro, A., Microsimulation as a Tool for Evaluating Redistribution Policies (2006) TheJournal of Economic Inequality, 4 (1), pp. 77-106; (2012) Nutrition Library, , http://sites.google.com/site/camnutlibrary/data, February; Cherrier, C., Gassmann, F., Mideros, A., Mohnen, P., Making the Investment Case for Social Protection. Methodological Challenges with Lessons Learnt from a Recent Study in Cambodia (2013) Working Paper 2013-06, , http://www.unicef-irc.org/, Florence: UNICEF Office of Research; Cury, S., Pedrozo, E., Mori Coelho, A., Callegari, I., The Impacts of Income Transfer programs on Income Distribution and Poverty in Brazil: An Integrated Microsimulation and Computable General Equilibrium Analysis (2010) MPIA Working Paper 2010-20, , http://portal.pep-net.org/, Partnership for Economic Policy – Modeling and Policy Impact Analysis; Debowicz, D., Golan, J., The Impact of Oportunidades on Human Capital and Income Distribution in Mexico: A Top-Down/Bottom-Up Approach (2014) Journal of Policy Modeling, 36 (1), pp. 24-42; (2011) Financing Social Pensions in Low and Middle Income Countries, , London: Help Age International Briefing; Hennicot, J.C., (2012) Financial Assessment of the National Social Protection Strategy for the Poor and Vulnerable Draft v.2, , Phnom Penh: International Labour Organization; Jolliffe, D., Whose Education Matter in the Determination of Household Income? Evidence from a Developing Country (2002) Economic Development and Cultural Change, 50 (2), pp. 287-312; Kagin, J., Taylor, E., Alfani, D., Davis, B., (2014) Local Economy-Wide Impact Evaluation (LEWIE) of Ethiopia’s Social Cash Transfer Pilot Programme, , http://www.fao.org/, Rome: Food and Agriculture Programme (FAO); Khondker, B.H., Knox-Vydmanov, C., Vilela, A., (2013) Old Age Social Protection Options for Bangladesh, , Dhaka: Bureau of Economic Research Dhaka University and Help Age International; Levy, S., Robinson, S., Can Cash Transfers Promote the Local Economy? (2014) Discussion Paper 01334, , http://www.ifpri.org/, Washington, DC: IFPRI; Li, J., O’Donoghue, C., A Survey of Dynamic Microsimulation Models: Uses, Model Structure and Methodology (2013) International Journal of Microsimulation, 6 (2), pp. 3-55. , http://www.microsimulation.org/; McKee, D., Todd, P., The Longer-Term Effects of Human Capital Enrichment Programs on Poverty and Inequality: Oportunidades in Mexico (2011) Estudios De Economía, 38 (1), pp. 67-100; Mideros, A., Gassmann, F., Mohnen, P., Estimation of Rates of Return on Social Protection: Making the Case for Non-Contributory Social Transfers in Cambodia (2013) Working Paper 2013-063, , http://www.merit.unu.edu/, Maastricht: UNU-MERIT and Maastricht Graduate School of Governance; (2009) General Population Census of Cambodia 2008, , Phnom Penh: Royal Government of Cambodia, Ministry of Planning; (2010) Cambodia Socio-Economic Survey 2009, , Phnom Penh: Royal Government of Cambodia, Ministry of Planning; (2010) Labour and Social Trends in Cambodia, , Phnom Penh: Royal Government of Cambodia, Ministry of Planning; (2011) National Accounts of Cambodia 1993-2000, , Phnom Penh: Royal Government of Cambodia, Ministry of Planning; (2011) Report 12. Population Projections of Cambodia, , Phnom Penh: Royal Government of Cambodia, Ministry of Planning; Notten, G., Gassmann, F., Size Matters: Targeting Efficiency and Poverty Reduction Effects of Means-tested and Universal Child Benefits in Russia (2008) Journal of European Social Policy, 18 (3), pp. 260-274; Ponce, J., Bedi, A., The Impact of a Cash Transfer Program on Cognitive Achievement: The Bono De Desarrollo Humano of Ecuador (2010) Economicsof Education Review, 29 (1), pp. 116-125; (2008) Rectangular Strategy for Growth, Employment, Equity and Efficiency. Phase II, , Phnom Penh: Royal Government of Cambodia; (2009) National Strategic Development Plan. Update 2009-2013, , Phnom Penh: Royal Government of Cambodia; Sadoulet, E., De Janvry, A., Davis, B., Cash Transfer Programs with Income Multipliers: PROCAMPO in Mexico (2001) World Development, 29 (6), pp. 1043-1056; Schady, N., Araujo, M.C., Cash Transfers, Conditions, School Enrolment and Child Work: Evidence from a Randomized Experiment in Ecuador (2006) Policy Research Working Paper 3930, , http://www.worldbank.org/, Washington, DC: World Bank; Schady, N., Rosero, J., Are Cash Transfers Made to Women Spent like Other Sources of Income? (2008) Economics Letters, 101 (3), pp. 246-248; Taylor, E., Kagin, J., Filipski, M., Thome, K., (2013) Evaluating General Equilibrium Impacts of Kenya’s Cash Transfer Programme for Orphans and Vulnerable Children (CT-OVC), , http://www.fao.org/, Rome: Food and Agriculture Organization (FAO); Taylor, E., Thome, K., Filipski, M., (2014) Evaluating Local General Equilibrium Impacts of Lesotho’s Child Grants Programme, , http://www.fao.org/, Rome: Food and Agriculture Organization (FAO); Thome, K., Filipski, M., Kagin, J., Taylor, J.E., Davis, B., Agricultural Spillover Effects of Cash Transfers: What Does LEWIE Have to Say (2013) American Journal of Agricultural Economics, 95 (5), pp. 1338-1344; Thome, K., Taylor, E., Kagin, J., Davis, B., Barko Osei, R., Osei-Akoto, I., (2014) Local Economy-wide Impact Evaluation (LEWIE) of Ghana’s Livelihood Empowerment Against Poverty (LEAP) Programme, , http://www.fao.org/, Rome: Food and Agriculture Organization (FAO); (2011) Human Development Report 2011. Sustainability and Equity: A Better Future for All, , New York: United Nations Development Programme; (2012) Integrated Social Protection Systems. Enhancing Equity for Children, , New York: United Nations Children’s Fund; Villa, J.M., Social Transfers and Growth. the Missing Evidence Crom Luminosity Data (2014) Working Paper 2014/09, , http://www.wider.unu.edu/, Helsinki: UNU-WIDER

PY - 2016

Y1 - 2016

N2 - This study estimates the rates of return of non-contributory social transfer programmes in Cambodia using household-level data and going beyond standard cost–efficiency analyses by developing a dynamic microsimulation model. It shows that social protection promotes equitable economic growth by enhancing human capital and fostering economic performance at the micro level. A positive rate of return is achieved after 12 periods and can reach between 12 per cent and 15 per cent after 20 periods. This study shows that microsimulation models can be extended in order to analyse the long-term economic returns on social protection. © 2015 Taylor & Francis.

AB - This study estimates the rates of return of non-contributory social transfer programmes in Cambodia using household-level data and going beyond standard cost–efficiency analyses by developing a dynamic microsimulation model. It shows that social protection promotes equitable economic growth by enhancing human capital and fostering economic performance at the micro level. A positive rate of return is achieved after 12 periods and can reach between 12 per cent and 15 per cent after 20 periods. This study shows that microsimulation models can be extended in order to analyse the long-term economic returns on social protection. © 2015 Taylor & Francis.

KW - Cambodia

KW - microsimulation

KW - rate of return

KW - social protection

KW - social transfers

KW - computer simulation

KW - economic growth

KW - estimation method

KW - human capital

KW - social policy

KW - MATTERS

KW - CASH TRANSFERS

KW - OPORTUNIDADES

KW - MEXICO

KW - POVERTY

KW - INCOME

KW - PROGRAMS

U2 - 10.1080/19439342.2015.1025815

DO - 10.1080/19439342.2015.1025815

M3 - Article

SN - 1943-9342

VL - 8

SP - 67

EP - 86

JO - Journal of Development Effectiveness

JF - Journal of Development Effectiveness

IS - 1

ER -

Estimation of rates of return on social protection: Ex ante micro-simulation of social transfers in Cambodia

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