Indicators for monitoring poverty reduction

In recent years, the World Bank has stressed that poverty reduction is its overarching objective. This paper discusses the indicators that are relevant in monitoring the performance of the Bank's lending for poverty reduction. For every project, three classes of indicators can be distinguished - - input, process, and impact. An indicator is classified depending on whether it reflects the means, the process, or the end in achieving the overall development objective of the project. Good monitoring requires a balanced use of all three types of indicators. The indicators should yield information that may be interpreted in a "with" versus "without" manner. That is, it should be possible to determine what these indicators would have been if the project had not taken place. Project analysis has to rely on "before" versus "after" data, control groups, and an understanding of exogenous factors that may influence the chosen indicators. In the case of adjustment lending, modelling may be used to construct counterfactual analysis. There are very few indicators of poverty per se. Poverty indices are among the few measures of poverty per se. Poverty indices refer to the three measures of income poverty -- the headcount index, the poverty gap index, and the squared poverty gap (or severity) index. Other poverty indicators fall into two categories. Poverty - related indicators and desegregated..