• Poverty analysis
• Case studies
• Defining poverty
• Participatory wealth ranking
• Poverty lines
• Poverty and social impact analysis
• Targeting

Poverty analysis

With increasing evidence that poor people depend on a variety of sources of income, activities and transfers, policy makers recognise the need to dissagregate policy analysis to the extent possible. But how is this done? In Syria, the FAO recently examined the distributive implications of fiscal policy on poverty and migration using a Social Accounting Matrix (SAM) for the Syrian economy. A new report now outlines the findings of this exercise.

The SAM approach takes into account distinctive features of rural economies, such as the diversification of production activities or the presence of social groups with alternative livelihood strategies. Built for 2004, the SAM in this study included accounts for 51 commodities, 41 production activities, 2 factors of production and 22 institutions. Households were disaggregated by income level (deciles of equivalent per capita expenditure) and by regional location (rural and urban).

The model was used to simulate the impact of variations in public spending on selected agricultural and food policies on households. The policies considered were:

• subsidies to agricultural and food production activities
• price support for strategic crops
• food consumption support in the form of the Price Stabilization Fund
  

Given the relative position of rural households in the income distribution of Syria, the poverty effects of the policy options were found to be small overall. In particular:

• cuts in agricultural and food subsidies and price support for strategic crops were found to reduce poverty
• eliminating production subsidies with an equivalent increase in transfers to households was found to be the best policy option in terms of poverty reduction
• eliminating food subsidies resulted in increased poverty, though transforming PSF resources into direct (monetary) payments to households was found to reduce urban poverty
  

According to the report, the study reveals:

• the ways in the design the government budget affects sectoral policies
• the significance of output growth for poverty reduction
• the need to take into account structural asymmetries in income distribution in the design of poverty reduction and migration policies

The report also recommends that future research further improve the SAM matrix by including new and more reliable information, including separate accounts for non-agricultural rural activities that are significant in rural development processes.

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