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Public expenditures on non-contributory pensions are equivalent to at least 1 percent of GDP in several countries in Latin America and is expected to increase. We explore the effect of non- contributory pensions on the well-being of the beneficiary population by studying the Pension 65 program in Peru, which uses a poverty eligibility threshold. We find that the program reduced the average score of beneficiaries on the Geriatric Depression Scale by nine percent and reduced the proportion of older adults doing paid work by four percentage points. Moreover, households with a beneficiary increased their level of consumption by 40 percent. All these effects are consistent with the findings of Galiani, Gertler and Bando (2016) in their study on a non-contributory pension scheme in Mexico. Thus, we conclude that the effects of non-contributory pensions on well-being in rural Mexico can be largely generalized to Peru.

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Working Paper
Date:
December 01, 2016
English

An audit study was conducted in Ghana, Mexico and Peru to understand the quality of financial information and products offered to low-income customers. Trained auditors visited multiple financial institutions, seeking credit and savings products. Consistent with Gabaix and Laibson (2006), staff only provides information about the cost when asked, disclosing less than a third of the total cost voluntarily. In fact, the cost disclosed voluntarily is uncorrelated with the expensiveness of the product. In addition, clients are rarely offered the cheapest product, most likely because staff is incentivized to offer more expensive and thus more profitable products to the institution. This suggests that clients are not provided enough information to be able to compare among products, and that disclosure and transparency policies may be ineffective because they undermine the commercial interest of financial institutions.

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Working Paper
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July 19, 2016
English

In developing countries, poor households often do not have access to formal financial products or use bank accounts to save for the future. Without a safe and secure way to save, many people rely on riskier and more expensive methods of managing their assets. Increasingly, government-to-person cash transfer programs are addressing this issue by providing beneficiaries with formal savings accounts through which they disburse cash transfers.

In Peru, evidence from one such program suggests that very few beneficiaries of a conditional cash transfer (CCT) use their accounts to save, preferring instead to withdraw the entire cash transfer immediately after it is made. Beneficiaries may prefer to withdraw their funds all at once due to the time and cost required to travel to a bank branch or automated teller machine (ATM) to access their account, especially in rural areas where there is limited banking infrastructure. Furthermore, although access is improved and travel time reduced, beneficiaries may not have the necessary knowledge or confidence when interacting with the formal financial system. This evaluation explores how the introduction of branchless banking and a workshop to build knowledge and trust of the formal financial system impacts beneficiaries’ attitudes toward this same system and savings behavior.

As a component of the pilot project and evaluation “Financial inclusion for the Rural Poor Using Agent Networks,” Banco de la Nación (BN) installed correspondent banking agents (MultiRed Agents) in municipalities and some shops on 30 districts of the Provinces of Puno, Cusco, Apurímac, and Ayacucho in Peru. Concurrently in 2015, the Instituto de Estudios Peruanos (IEP) implemented education and trust workshops in a subset of the districts where agents were functioning with the objective of improving the knowledge, trust, and empowerment of beneficiaries of the state’s conditional cash transfer program (JUNTOS) in the formal financial system and encouraging the use of formal savings accounts via BN correspondent banking agents.

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Working Paper
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April 30, 2016
English

We provide evidence from field experiments with three different banks, that reminder messages increase commitment attainment for clients who recently opened commitment savings accounts. Messages that mention both savings goals and financial incentives are particularly effective, while other content variations such as gain versus loss framing do not have significantly different effects. Nor do we find evidence that receiving additional late reminders has an additive effect. These empirical results do not map neatly into existing models, so we provide a simple model where limited attention to exceptional expenses can generate under-saving that is in turn mitigated by reminders.

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Published Paper
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January 19, 2016
Spanish A4

En el marco de la gestión pública por resultados, se viene fortaleciendo una cultura de seguimiento y evaluación en el país, lo cual permite la generación de evidencia para la formulación de políticas públicas de efectiva intervención para el desarrollo y bienestar de la población.

En ese contexto se crea la Red Peruana de Monitoreo y Evaluación-REDPERUME, como una organización integrada por actores públicos y privados, que promueve la institucionalización de una cultura de seguimiento y evaluación, contribuyendo de este modo a la efectividad de las políticas, planes, programas y proyectos.

Esta Red surge hacia finales del año 2010, como un grupo adscrito a la Red Latinoamérica y del Caribe de Monitoreo y Evaluación-REDLACME, a iniciativa del Ministerio de la Mujer y Poblaciones Vulnerables-MIMP.

A la fecha cuenta con 286 integrantes de diversos Sectores del Estado, Organizaciones Privadas y de la Sociedad Civil, encontrando en la Red un espacio vivo para el intercambio de experiencias y el fortalecimiento de sus capacidades en temas de seguimiento y evaluación.

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Report
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December 04, 2015
English

For policy purposes, it is important to understand the relative efficacy of various methods to target the poor. Recently, participatory methods have received particular attention. We examine the effectiveness of a hybrid two-step process that combines a participatory wealth ranking and a verification household survey, relative to two proxy means tests (the Progress out of Poverty Index and a housing index), in Honduras and Peru. The methods we examine perform similarly by various metrics. They all identify most accurately the poorest and the wealthiest households but perform with mixed results among households in the middle of the distribution. Ultimately, given similar performance, the analysis suggests that costs should be the driving consideration in choosing across methods.

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Published Paper
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December 01, 2015

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