Poverty and Social Impact Analysis (PSIA) refers to the analysis of the distributional impact of policy reforms on the well-being or welfare of different stakeholder groups, with particular focus on the poor and vulnerable. The adoption of the Poverty Reduction Strategy Paper approach and of the Millennium Development Goals has led to an increased need for more systematic analysis of the poverty and social implications of reforms. This User’s Guide is part of a comprehensive response undertaken by the World Bank to address those concerns.
The User’s Guide is intended for practitioners undertaking PSIA in developing countries. Given the broad scope of policy issues, methods, and challenges involved, the User’s Guide does not specify minimum standards for PSIA, but rather provides suggestions on how to approach the analysis. In advocating a multidisciplinary approach to PSIA, the User’s Guide presents both economic and social analysis tools and methods. While focusing on distributional impacts, PSIA also addresses issues of sustainability and risks to policy reform that come with the poverty and social impacts of policy changes.
The User’s Guide is organized as follows. It begins with an Introduction, which is available in different languages to the right. Chapter 2 introduces the main concepts underlying PSIA and establishes the conceptual framework. Chapter 3 then presents an approach to PSIA by reviewing 10 basic elements underlying the sound analysis of the poverty and social impacts of reforms. Chapter 4 considers some of the major constraints often identified by PSIA practitioners, especially in developing countries, and provides basic operational principles for PSIA. Chapter 5 proposes a summary matrix that can be a useful tool to capture and integrate the various elements of good PSIA. Finally, Chapter 6 closes with brief conclusions, and a bibliography points readers to useful resources.
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