Progress against Poverty: Sustaining Mexico's Progresa-Oportunidades Program by Santiago Levy

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In 1997 Mexico launched a radical new program to combat poverty. Initially named Progresa and now known as Oportunidades, this revolutionary program has become an important example of a sustainable and scalable poverty reduction strategy in the developing world. In Progress against Poverty, Santiago Levy-the main architect of Progresa-Oportunidades-Offers his unique perspective on the development of the program, the reasons for its success, the challenges it faces, and its applicability in other nations.

Progresa-Oportunidades is pioneering in its approach. It dispenses money directly to poor households-a change from the traditional method of providing subsidized necessities through intermediaries. However, those cash transfers are conditioned on specific patterns of behavior-recipients must invest in their own nutrition, health, and education. Also, Progresa-Oportunidades was designed to have a widespread, measurable, and sustained impact on various indicators of poverty. It is ambitious in scale, with a national rather than local focus, and its progress is measured through comprehensive evaluation of program operations and results.

Scholarly evaluations of Progresa-Oportunidades have been overwhelmingly positive, and it has inspired similar strategies in numerous developing nations. In addition to discussing micro- and macroeconomic dimensions of the program, Levy reveals the factors that have contributed to its sustainability, as well as the public information mechanisms supporting its implementation and the role of the evaluation process. He identifies the future challenges the program faces, such as making its incentives compatible with those of other social programs, anddiscusses its transferability to other countries.

About the Author:
Santiago Levy is a former general director of the Mexican Social Security Institute

Product Details

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Table of Contents

Read a Sample Chapter

At that time, Progresa-Oportunidades was a novel initiative, inasmuch as it

-sought to substitute cash income transfers for income transfers in the form of targeted or generalized food subsidies (through price discounts, price controls, in-kind distributions of food items, and the like), giving beneficiary families complete freedom in their spending decisions

-conditioned the receipt of cash transfers on specific patterns of behavior by beneficiary households

-packaged nutritional, health, and educational benefits together to exploit their complementarities

-adopted a life-cycle approach to avoid long-term welfare dependence

-included evaluations of program operations and impacts as part of program design

-applied strict guidelines for selecting beneficiaries

-delivered benefits directly to beneficiaries, with no intermediaries.

At the end of 2005, under the administration of President Vicente Fox, Progresa-Oportunidades covered 5 million families, representing almost 24 percent of the country's population and practically all households living in extreme poverty. It operated in more than 86,000 localities in all thirty-one states of the country, with a budget of US$2.8 billion (see tables 2-1 and 2-5). Over the course of this period, many scholars evaluated the program, principally in terms of its impact on beneficiaries' consumption, health, nutrition, education, investment, intrahousehold relationships, use of labor time, and migration patterns. They also evaluated the program's methods of targeting eligible households and its effects on poverty indicators. Results to date have been positive; perhaps one could say very positive. Because of its novel approach and its results so far, Progresa-Oportunidades has at times been mentioned as an initiative that may provide useful lessons for reducing poverty in other countries.

Purpose of the Study

This book presents a case study of Progresa-Oportunidades, written under the assumption that, at least so far, the program can be considered a successful development initiative. Its purpose is to contribute to knowledge of how successful development initiatives can be designed and implemented so that they are sustained, adapted, scaled-up, and replicated to solve key development challenges. With that aim in mind, the book centers its attention on the

-main factors that have contributed to program continuity and sustainability over almost a decade, including the incentives of the domestic political system and multilateral institutions

-policies that have allowed the program to operate at the national level and attain its large scale

-public information mechanisms that have supported program implementation

-the role of evaluation in program scale-up and continuity and the lessons of the randomized approach used in the evaluation process

-future challenges that the program faces

-potential lessons that the program might provide, including insights on the transferability of programs of this nature to other countries.

Other aspects of the program-particularly the more technical issues of poverty measurement, algorithms for identifying beneficiaries, and techniques for impact evaluations-are either ignored or touched on only as necessary for the purposes of the study.

Chapters 1 and 2 describe the origins, objectives, and scope of Progresa-Oportunidades, drawing from Levy and Rodriguez (2004). Chapter 3 provides a broad assessment of the main program results to date, bringing together the results of quantitative and qualitative evaluations of rural and urban areas carried out from 1998 to mid-2006, including results of reports available only in Spanish. Chapter 4 describes institutional design features of the program. Chapter 5 discusses the primary future challenges that the program faces. Finally, chapter 6 makes some suggestions for poverty programs drawn from the main lessons learned through Progresa-Oportunidades.

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