How do we measure poverty in Paraguay for more agile responses?

2020 household survey, in line with international good practices, SWIFT was used by the Bureau of Statistics and the World Bank to restore the comparability of expenditure data and poverty rates with previous survey years.

In Paraguay, the methodology has been tailored to the local context to ensure its sustainability, its implementation by the relevant institutions, and the possibility of making adjustments to the methodology . The results show that, in addition to producing estimates close to the official poverty figures, the quarterly estimates also capture short-term variations in trends.

Quarterly poverty forecast in Paraguay

The methodology is based on variables that tend to be stable over time such as household size, property ownership and educational level, as well as fast-changing variables such as labor market indicators reflecting quarterly changes. Income is adjusted for inflation using the Consumer Price Index (CPI) produced by the Central Bank of Paraguay (BCP). This strategy uses the most recent (fourth quarter) data from the EPHC to train the models, thus enabling poverty rates to be estimated as soon as data from the quarterly surveys become available.

With the implementation of SWIFT, we will have more useful and timely data for implementing public policies. Furthermore, we will be in a better position to analyze changes between periods in greater detail, forecast the impacts of specific events, and implement measures  to mitigate the negative effects of adverse shocks on the economy  and protect the most vulnerable populations.

Source: Worldbank