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American Economic Review: Vol. 102 No. 4 (June 2012)

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Targeting the Poor: Evidence from a Field Experiment in Indonesia

Article Citation

Alatas, Vivi, Abhijit Banerjee, Rema Hanna, Benjamin A. Olken, and Julia Tobias. 2012. "Targeting the Poor: Evidence from a Field Experiment in Indonesia." American Economic Review, 102(4): 1206-40.

DOI: 10.1257/aer.102.4.1206

Abstract

This paper reports an experiment in 640 Indonesian villages on three approaches to target the poor: proxy means tests (PMT), where assets are used to predict consumption; community targeting, where villagers rank everyone from richest to poorest; and a hybrid. Defining poverty based on PPP$2 per capita consumption, community targeting and the hybrid perform somewhat worse in identifying the poor than PMT, though not by enough to significantly affect poverty outcomes for a typical program. Elite capture does not explain these results. Instead, communities appear to apply a different concept of poverty. Consistent with this finding, community targeting results in higher satisfaction. (JEL C93, I32, I38, O12, O15, O18, R23)

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Authors

Alatas, Vivi (World Bank)
Banerjee, Abhijit (MIT)
Hanna, Rema (Harvard U)
Olken, Benjamin A. (MIT)
Tobias, Julia (Stanford U)

JEL Classifications

C93: Field Experiments
I32: Measurement and Analysis of Poverty
I38: Welfare and Poverty: Government Programs; Provision and Effects of Welfare Programs
O12: Microeconomic Analyses of Economic Development
O15: Economic Development: Human Resources; Human Development; Income Distribution; Migration
O18: Economic Development: Urban, Rural, Regional, and Transportation Analysis; Housing; Infrastructure
R23: Urban, Rural, Regional, and Transportation Economics: Regional Migration; Regional Labor Markets; Population; Neighborhood Characteristics


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