Which targeting mechanism?
Targeting of transfers in developing countries: review of lessons and experience
Effectiveness of targeting interventions in developing countries
Authors:
D. Coady; M. Grosh; J. Hoddinott
Publisher:
World Bank, 2004
This book provides a general review of experiences and lessons learned with methods used to target interventions in developing countries. The objective is to convey available targeting options, anticipated results, and relevant information to assist in optimising the implementation of the chosen option.
A brief review of targeting, discussing the benefits and costs of targeting, methods for assessing targeting performance, and a taxonomy of targeting methods is provided. In addition, the authors analyse quantitative evidence on targeting outcomes derived from an extensive review of existing studies. A qualitative analysis of common targeting methods is also provided, including a review of international experience, how the method works, what determines how well it works, what its costs are likely to be, and appropriate circumstances for its use.
The book puts forward the following five core messages about targeting effectiveness:
- Targeting can work...: across all programmes for which the authors could obtain information on targeting performance, they found that the median programme provides approximately 25 percent more resources to the poor than would random allocations. The best programmes were able to concentrate a high level of resources on poor individuals and households
- ...but it doesn’t always: in approximately 25 percent of cases targeting was regressive so that a random allocation of resources would have provided a greater share of benefits to the poor. For every method considered, excepting targeting based on a work requirement, there was at least one example of a regressive programme
- There is no clearly preferred method for all types of programmes or all country contexts: in the sample of programmes, 80 percent of the variability in targeting performance was due to differences within targeting methods and only 20 percent was due to differences across methods
- A weak ranking of outcomes achieved by different mechanisms was possible: interventions that use means testing, geographic targeting, and self-selection based on a work requirement are all associated with an increased share of benefits going to the bottom two quintiles relative to targeting that uses self-selection based on consumption
- Implementation matters tremendously to outcomes: targeting performance improved with country income levels (the proxy for implementation capacity), the extent to which governments are held accountable for their actions, and the degree of inequality.
