types of crises
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WORLD FAMILY SUMMIT +7 The impact of the crisis: How the international economic and financial crisis has impacted families at the local level Wanda Engel December 6, 2011. Types of Crises. Idiosyncratic: within the family environment, the level of vulnerability increases due to: Diseases - PowerPoint PPT PresentationTRANSCRIPT
WORLD FAMILY SUMMIT +7
The impact of the crisis: How the international economic and financial crisis has impacted families at the local level
Wanda Engel December 6, 2011
Types of Crises
Idiosyncratic: within the family environment, the level of vulnerability increases due to:
• Diseases• Natural catastrophes• Unemployment of adults
Systemic: caused by economic shocks• 1930: Great Depression• 1994/95: Mexico• 1997/98: Asian crisis• 2008/9: Global Financial Crisis
The crisis as a multidimensional phenomenon
Economic DevelopmentEconomic Development
Areas Affected: Economic Development
• Poverty and extreme poverty• Informal economy (without Social Security coverage)• Youth unemployment• Infant labor• Increase in food and energy prices• Reduction in remittances
Affect the conditions needed for sustainable development
Source: Harper,C. and Jones, N. Impact of Economic Crises on Child Well-Being
Increase in underemployment and unemploymentDrop in the net creation of jobs - 2009
* Report “The Brazilian Economy in Perspective” - May/July 2011 edition
Increase in underemployment and unemploymentBehavior in the balance of jobs – 2007-2009
Source: Global Financial Crisis: social impacts and impacts on the labor market, 2009.
The crisis as a multidimensional phenomenon
Human Development
Human Development
Economic DevelopmentEconomic Development
Areas Affected: Human Development
Health:• Hunger/malnutrition• Suicide• Heart diseases• Alcohol consumption and hepatic cirrhosis• Mental diseases
Education: •Movement from private schools to public schools•School Exodus: boys drop out to work and girls drop out to take care of brothers
Source: Harper, C. and Jones, N. Impact of Economic Crises on Child Well-Being
Human Development Impacts – a few signals(WB/IMF 2010)
Human indicators drop more rapidly during crises but improve in subsequent growth periods.
2008 – 2010 Period
The crisis as a multidimensional phenomenon
Human Development
Human Development
Social Development
Social Development
Economic DevelopmentEconomic Development
Society• Violence and crimes• Social fragmentation• Political instability• Xenophobia• Terrorism
Halt social progressReduce social cohesion
Areas Affected: Social Development
Family• Family stress• Divorces• Migration to work• Infant exploitation• Violence against women and children
Decline of Social CapitalStagnation of the GINI Index 2008–2009
* Report “The Brazilian Economy in Perspective” - May/July 2011 edition
The crisis as a multidimensional phenomenon
Social ProtectionSocial Protection
Human Development
Human Development
Social Development
Social Development
Economic DevelopmentEconomic Development
Social Protection
Concept
Public intervention with the objective of helping individuals, families and communities manage crisis situations (structural or idiosyncratic) and
offer basic conditions to those submitted to extreme poverty.
Social Protection
Poverty Line
Social Protection Networks: Objectives
Prevent the loss of:• Human capital• Social capital• Economic assets
Mitigate:• Social Security• Emergency aid
Overcome:•Subsidies•Transfers
Types of Intervention
Social Security Emergency Aid Subsidies Benefits
• Unemployment insurance
• Agriculture production insurance
• Housing aid
• Helthcare aid
• Transportation vouchers
• Meal vouchers
• Basic food basket
• Work front
• Subsidized products
• Subsidized services
• Benefits
• Conditional cash transfer programs
Key Challenges
The efficiency, efficacy and effectiveness and integration challenge: • Partnership: civil society (volunteering) • Social control against fraud, error and corruption
Dilemma: crisis vs. social investment
Double challenge: mitigate impacts and protect against future human and social capital losses
Lack of fiscal sustainability risk
Need for a universal and permanent Social Protection Network
Conditions
The crisis as a multidimensional phenomenon
Social Protection NetworkSocial Protection Network
Human Development
Human Development
Social Development
Social Development
Economic DevelopmentEconomic Development
Human Development
Documentation
HousingLand ownership regularization
CreditUrban and living improvements
EducationAccess to different levels of regular education
Adult literacySupplementary educationComplementary activities
CultureAccess to cultural assets
Support to different forms of expression
HealthcareSanitation / water
Family healthImprovement of environmental conditions
SportsAccess to sporting equipment
Sports schoolsSports for youngsters
ConditionsSocial Protection NetworkSocial Protection Network
Human Development
Human Development
Social Development
Social Development
Economic DevelopmentEconomic Development
The crisis as a multidimensional phenomenon
Capabilities
The main economic development proposals
• Subsidy and/or control over food prices
• Flexibilize the labor market
• Encourage the domestic (family and country) production of food and offer technical support for boosting productivity (EMBRAPA)
• Unemployment aid
• Public employment (workfare)
• Changes in the energy grid
• Support towards micro-businesses
ConditionsSocial ProtectionSocial Protection
Human Development
Human Development
Social Development
Social Development
Economic DevelopmentEconomic Development
The crisis as a multidimensional phenomenon
Capabilities
In order to manage a crisis (multidimensional), an intervention that utilizes an integral strategy is necessary.
Opportunities
A new proposal for facing crises:Cash Transfer Programs
Challenge:How to make them a more integral strategy?
Cash Transfer Programs(Fiszbein, Ringold and Srinivasan, 2011)
Impacts:Inject monetary funds in areas of extreme poverty, creating a consumer market and leveraging the economy.Help reduce the impacts of idiosyncratic and systemic shocks, including the potential effects on the human capital accumulation process in children.
Origin:Beneficiaries: families with childrenA long-term poverty reduction goal; not an answer to crises
Types: CCT and UTCDebates regarding the effectiveness of conditions.Monitoring of conditions could scare away the most vulnerable.
Summary of selected cash-transfers programmes and responses, 2008-09
Expanded coverageIncreased benefit amounts
Introduced new programmes
Philippines (4P) Mexico (Oportunidades) Indonesia (BLT)
Kenya (OVC-CT)Latvia (Guaranteed Minimum Income)
Pakistan (BISP)
Malawi (Mchinji)Kyrgyz Republic (Unified Monthly Benefit)
Senegal (Social Cash Transfer and Nutritional Security)
Brazil (Bolsa Família) Brazil (Bolsa Família)El Salvador (Comunidades Solidarias Rurales)
Mexico (Oportunidades) Guatemala (MIFAPRO)
Latvia (Guaranteed Minimum Income)
Kyrgyz Republic (Unified Monthly Benefit)
Familias en Acción (Colombia); Programa de Asignación Familiar - PRAF (Honduras); Programa de Avance hacia la Educación y la Salud (Jamaica); Plan Familias (Argentina); Chile Solidario (Chile)
Cash Transfer Programs(Fiszbein, Ringold and Srinivasan, 2011)
Limits:- These programs are an economic answer while the consequences of crisis are multidimensional- They should be one of the components within an integral human, social and economic development strategy
Prerequisites: - Administrative capacity - Information system (Census data, household data, indexes) - Mechanisms for payments
Focus Strategies: - Self- targeted: inexpensive and the easiest to expand (Brazil)- Geographic targeting- Target methodology: requires household visits, possesses quick-expansion difficulties in the crisis and removal of beneficiaries in the after crisis
Lessons Learned: - Countries that implemented CT programs as pilot projects had greater ease expanding them during the crisis
Four Generations of Cash Transfer Programs
Type of TRCSocial
ProtectionHuman
DevelopmentEconomic
DevelopmentSocial
DevelopmentSpecific
Demands
Unconditioned Transfers
Minimum income
Consumer
market
Bank Branches (BB)
Conditioned Transfers
Minimum income
Healthcare and education as conditions
Consumer market
BBIntegrated Beneficiary Information
System (SIIB)
Conditioned transfer +
integral family development
programs
Minimum incomePriority
access to aid programs
Healthcare and education as
conditionsPriority access to education,
healthcare and housing programs
Priority access to training,
income generation, job market
inclusion and credit programs
Family strengthening
BBSIIB
Integrated Information System on
Programs and Services (SIIPS)
Promoter of families
Economic crises serve to remind
us that it is essential that people
be healthy, educated, have adequate
housing, be well fed and live in
a positive family and social environment
in order to be more productive and
qualified to contribute to society.