Reviewing the Effectiveness of PSIA on National Policy Making

The World Bank has recently commissioned a PSIA review, with financial support from the German Ministry of Economic Cooperation and Development (BMZ).

The overall purpose of the review is to improve the practice and enhance the use of poverty and social impact analysis in the World Bank and in partner countries, including a review of the effects of PSIA on policy making in-country. The review intends to achieve this by: (a) obtaining a picture of the kinds of outcomes and impacts PSIA work has achieved, particularly at country level, and (b) providing insights into what works, where and when. The findings of the review should also inform recommendations to tackle identified constraints and provide guidance to the PSIA community about how to adjust the present PSIA approach so it (a) more effectively informs in-country and Bank policy design, and (b) is applied more routinely within the Bank and in partner governments.

The review is based on eight country case studies (Cambodia, DRC, Indonesia, Kenya, Madagascar, Nepal, Tanzania, Yemen) and divides the main findings up into three areas:

1. Linking analysis to policy processes
2. Building conditions for more pro-poor decision-making
3. Building public support for reform implementation 

1.  Linking Analysis to Policy Processes

Here the review finds several fairly clear examples of PSIA contributing to specific policy choices or a shift in programme design. While the magnitude of these effects are fairly modest, nevertheless a tangible impact on country level processes is evident.  The most durable influence or contribution appears to be from the more process-oriented PSIAs. However, effects can be seen across the board.  Factors associated with more influential PSIAs incude: alignment with the national policy calendar, operational relevance and useability, high level champions on the government side and local advocates in Bank or development partner offices at country level.

2.  Building Conditions for more Pro-Poor Policy Making

The PSIA framework stresses that building the conditions for pro-poor policy making requires attention to in-country institutional capacity for policy analysis and the use of findings for policy purposes. Of the eight cases reviewed, only two involved some form of explicit capacity support – mainly to local researchers - while others touched on it as part of the process of undertaking the PSIA.  Part of the challenge in supporting institutional capacity is that it can rarely be done in a one-shot process; rather it needs successive iterations. Having technical specialists working in the sector on the PSIA team can also contribute to improved conditions for PSIA up-take, while multi-donor engagement can help build a coalition for change that is supportive of capacity development over a period of time and not just around the PSIA itself.

3.  Building Public Support for Implementation

Stakeholder engagement is a central feature of the process-oriented PSIAs in the review sample. The wider literature would suggest that the hard work of building greater public awareness of and support for pro-poor reforms does not end with dissemination but begins with it. Similar to capacity development, dissemination is not a one-off event and should be given greater prominence within a more phased PSIA approach.

The review was conducted by the Overseas Development Institute under the leadership of Alison Evans. The full text version of the review will be made available on this website in the first half of 2009.

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