Current Issues in Project Analysis for Development

Current Issues in Project Analysis for Development

Elgar original reference

Edited by John Weiss and David Potts

This major work brings together authors with experience of both academic and operational project work to focus on issues such as the shadow exchange rate, the shadow wage, the discount rate and assessment of poverty impact and risk, as well as problems relating to specific sectors covering environmental projects, transport, education and health. There are also general chapters on the experience of semi-input–output-based estimation of shadow prices and the relevance of shadow pricing techniques to the context of developed economies in the EU. An overview by the editors sets out the evolution of the literature and highlights current issues. The general conclusion is that project analysis techniques remain relevant, albeit within a very different development context to that in which they were originally envisaged to be applied.

Chapter 5: Projects and the MDGs: Estimating Poverty Impact

Manabu Fujimura

Subjects: development studies, development economics, economics and finance, development economics


Manabu Fujimura Well before the adoption of the Millennium Development Goals (MDGs) by the United Nations in 2000, the development community had been looking into how to harness development programmes and projects toward benefiting the poor (see for example World Bank, 1990). In the literature on project economics, since its heyday in the 1970s various efforts have been made to extend project analysis to incorporate distributional and poverty impacts. This chapter reviews such efforts on both analytical and operational fronts. It first discusses general issues involved in distribution and poverty impact analysis, then reviews experiences at multilateral development banks including recent case studies at the Asian Development Bank. The chapter concludes with some lessons learned. ISSUES To Target or Not to Target? The development community seems to have reached a consensus that growth is a necessary but not sufficient condition for poverty reduction and ‘pro-poor’ growth is preferred to growth maximisation. However, it is not entirely clear what exactly constitutes the sufficient condition and how things should be done differently from the past. While many governments and donors fund targeted interventions for poverty reduction, it is not easy to demonstrate that in general targeted interventions bring greater benefits to the poor than non-targeted interventions. Some may argue that non-targeted infrastructure projects are superior to targeted social sector projects in having far-reaching poverty reduction effects, provided that the policy and institutional environment is right. Such sentiment may be stronger among economists who witnessed the experience of East Asian economies. On the...

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