Nicaragua - Poverty assessment (Vol. 2 of 2) : Annexes

Report No. 14038-NI Republic of Nicaragua Poverty Assessment (In Two Volumes) Volume Il: Annexes June 1, 1995 Country Department II Country Operations Division Latin America and the Caribbean Regional Office Document of the World Bank  CURRENCY EQUIVALENTS Currency Unit = C6rdoba (C$) US$1 = C$6 (November 1993, time of survey) ACRONYMS BANADES National Development Bank CDC Centers for Disease Control CONAGRO National Commission for Agriculture CORNAP State-owned Corporations Holding Company CIDA Canadian International Development Agency DANIDA Danish International Development Agency EEC European Economic Community ENABAS State Agricultural Marketing Company FAO Food and Agriculture Organization FINNIDA Finnish Department of International Development Cooperation FISE Emergency Social Investment Fund FONIF Fondo Nicaraguense de la Niniez y la Familia GDP Gross Domestic Product GON Government of Nicaragua IDA International Development Association IDB Inter-American Development Bank IMF International Monetary Fund INAA National Water Authority INATEC National Technological Institute INCAP Institute of Nutrition of Central America and Panama INE State Public Utility Company INEC National Institute of Statistics and Census INIFOM Municipal Development Institute INRA Agrarian Reform Institute INSS Social Security Institute (previously INSSBI) INTA Institute for Agricultural Technology KfW German Credit Institute for Reconstruction LSMS Living Standards Measurement Survey MAG Ministry of Agriculture MARENA Ministry for Natural Resources and the Environment MAS Ministry of Social Action MEDE Ministry of the Economy MIS Management Information System MOE Ministry of Education (or MED) MOF Ministry of Finance MOH Ministry of Health (or MINSA) NGO Non-Governmental Organization PAHO Pan American Health Organization PAMIC Micro-enterprise Support Program PAN Nicaraguan Food Program PHC Primary Health Care RUTA Regional Unit for Technical Assistance SIDA Swedish International Development Authority SILAIS Local Systems of Integrated Health Services UNDP United Nations Development Programme UNESCO United Nations Educational, Scientific and Cultural Organization UNFPA United Nations Fund for Population Activities UNICEF United Nations Children's Fund USAID United States Agency for International Development WFP World Food Program WHO World Health Organization  NICARAGUA POVERTY ASSESSMENT TABLE OF CONTENTS Volume II (In two volumes) Annex 1. Nicaragua Poverty Prorde .......................... 1 I. The Extent of Poverty ..1............... A. Data Source and Methodological Approach .... ....... 1 B. The Magnitude of Poverty ..................... 5 C. The Consumption Patterns of the Poor .............. 8 II. Characteristics of the Poor .. 8 A. Characteristics of Poor Households ................ 8 B. Housing and Social Infrastructure ................. 9 C. Access to Basic Social Services - Education .... ...... 9 D. Access to Basic Social Services - Health .... ....... 13 E. Labor Markets ........................... 16 APPENDICES (of Poverty Profile) ....................... 21 Annex 2. Household Sources of Income ....................... 58 Annex 3. The Informal Sector of Nicaragua .................... 66 Anniex 4. Labor Markets in Nicaragua ........................ 70 Annex 5. Determinants of Educational Attainment in Nicaragua ... .... 78  . .. :-  ANNEX 1 NICARAGUA POVERTY PROFILE 1. THE EXTENT OF POVERTY A. Data Source and Methodological Approach (1) Data Source: The 1993 Living Standards Measurement Survey 1. The data fbr the present analysis of poverty in Nicaragua come from the LSMS carried out from February through June of 1993 (LSMS-93). The LSMS-93 is a household survey that was administered in both urban and rural areas in all regions of the country. The purpose of the study was to provide policy relevant data on living conditions in Nicaragua fbr use by the GON in designing a poverty alleviation strategy.Y The survey was implemented by the National Institute of Statistics and Census (INEC) and was supported by IDA with co-financing from the United Nations' Development Programme (UNDP) and Children's Defense Fund (UNICEF), the Swedish International Development Authority (SIDA), the United States Agency for International Development (USAID) and the GON. 2. The Sample. The sample is representative for urban and rural areas at the regional level of the country.y' Given the absence of estimations of variance at the regional level for the principal variables of the survey it was not possible to create a self-weighting sample. Instead, the Managua region was allocated a proportion of the interviews close to its proportion of national population (according to 1991 estimates) with the remaining interviews being distributed equally among the other six regions, independent of population size. Within each region, the sample was distributed proportionally in the rural and urban areas.3' To correct for over- or under-sampling by region, the LSMS-93 sample was weighted based on the population projections for 1991 done by INEC using the 1982 census maps.4' 3. Once the sample was weighted and households with missing data were dropped (approximately 9 percent of total households), the sample consisted of 4,213 households for a total of 23,135 1' See Appendix 1 for details of the information gathered in the survey. v The country was divided into seven regions with each region encompassing form one to four departments. The breakdown is as follows: REGION DEPARTMENTS Segovias Estelf, Madrfz, and Nueva Segovia Western Region Le6n and Chinandega Managua Managua Southern Granada, Masaya, Carazo, and Rivas Central Boaco and Chontales Northern Jinotega and Matagalpa Atlantic Coast RAAS, RAAN, and Rio San Juan A map of the country showing the regional breakdown is found in Appendix 13. -' A detailed description of the sample design and some of the problems faced in constructing it are included in Appendix 2. " See Nicaraeua en Cifras. 1991, INEC, Managua, 1992.  individuals.5' The distribution of these households and individuals by regions and urban and rural areas is shown in Table 1. Table 1: Distribution of Households and Individuals by Region and Geographic Area, 1993 Houscholds |Household Members | Region Urban Rural [Ttal Percent Urban Rural Total Percent Segovias 173 214 387 9.2% 1,015 1,230 2,245 9.7% vNstern 443 294 737 17.5% 2,318 1,689 4,008 17.3% Managua 1,050 173 1,223 29.0% 5,409 1,003 6,412 27.7% Southern 398 243 641 15.2% 2,251 1,566 3,817 16.5% Cental 107 161 268 6.4% 571 951 1,522 6.6% Northern 183 383 566 13.4% 934 2,124 3,059 13.2% Atlantic Coast 198 193 391 9.3% 991 1,082 2,073 9.0 % Total 2,552 1,661 4,213 100.0% 13,489 9,646 23,135 100.0% Source: LSMS, Nicaragua 1993. (2) Methodological Approach 4. The first part of this section describes the method used to construct the poverty line and the extreme poverty line. The second part of the section reviews how the various components of the line were calculated (for detailed information and a discussion of the conceptual issues involved in constructing the poverty line see Appendix 3). The final portion of the section contains the actual estimated poverty lines for Nicaragua. (a) The Poverty Line 5. The poverty line is defined as the level of total per capita monthly (30 day) expenditures at which an individual obtains the minimum daily caloric requirement. Expenditures are used, as opposed to income, for three reasons: (i) expenditure data are more accurate than income data; (ii) income data are notoriously unreliable for workers in agriculture and the informal sectors of the economy; and (iii) expenditures tend to vary less than income and are therefore more reflective of actual living standards. 5' Note that the individuals included here are household members only. Domestic staff and paying boarders or all persons (except the household head) who were absent from the household for more than nine of the tvelve months prior to the interview are not included. Children under three months of age, of household members, are included even if they have not lived in the household.  - 3 - 6. The poverty line is estimated at the point where per capita expenditures are sufficient to obtain the minimum caloric requirements.