PROTECTING THE POOR AGAINST THE NEXT CRISIS
Crises are likely to be new normal for developing and transition economies. In designing programs to protect the poor against crises, governments face two uncertainties— uncertainty of crisis type and uncertainty of crisis timing. In the face of these uncertainties, I propose three lines of action for governments and for the international community: (i) Conduct a Social Protection Assessment Program which “stress tests” the collection of social protection interventions against a range of possible crises to reveal gaps and vulnerabilities, (ii) Over the medium term, finance improvements in design to addressing these gaps and vulnerabilities, and (iii) offer a pre-qualified line of assistance for social protection which goes into action automatically when crisis triggers are breached.
WP 2010-09 May 2010
Charles H. Dyson School of Applied Economics and Management, Cornell University