Poverty reduction strategy papers: policies, paradigms, and impacts

Submission note: A thesis submitted in total fulfilment of the requirements of the degree of Doctor of Philosophy to the School of Economics, Faculty of Business, Economics and Law, La Trobe University, Bundoora.

The introduction of the World Bank’s Poverty Reduction Strategy Papers (PRSPs) in September 2000 promised a new focus on poverty reduction with national ownership driving the process. With a decade passing since their introduction, quantitative evaluations have been relatively sparse. This thesis examines the content of 79 PRSPs from 58 countries and an alignment to the following development paradigms: Washington Consensus, Post- Washington Consensus, and New York Consensus and also their alignment to the social protection agenda. A unique scorecard system is used to devise an index to assess each PRSP’s alignment to the respective paradigms. The index then identifies common factors that explain the variation in alignment scores. The previous research has not focused on how different development paradigms are influencing policy adoption in PRSPs and in turn how these policies are driving well-being outcomes. This research uses treatment and control groups with propensity score matching techniques and fixed effects modelling to analyse whether having a PRSP influences changes in poverty and progress towards the Millennium Development Goals. It also tests whether alignment to a respective paradigm has further influence on well-being and poverty outcomes. The research finds that countries under PRSP treatment have achieved better well-being outcomes than those in the control group. Furthermore, PRSPs aligned with the New York Consensus have higher primary school enrolment, better gender balance within schools, lower rates of infant mortality and a lower prevalence of HIV/AIDS.