A Multidimensional Well-being Approach to a Rural Business Development Program in Nicaragua

Despite the progress made on multidimensional approaches to well-being, in-come-based methods continue to set the framework for economic policy. This research analyzes how increased income and other dimensions of poverty and well-being are understood and measured in program evaluation. It uses a study case of Rural Business Development in Nicaragua in order to illustrate the relationship between income and other dimensions such as level of education, health and access to credit from the perspective of the Capability Approach. The paper draws on secondary data collected from 1,600 rural farmers and utilizes econometric techniques to describe the extent of the program impact as well as whether causal effect is established between the program treatment and the studied variables. The findings indicate that despite a boost of up to 30% in farmer income, changes in the dimensions used are not directly associated with program treatment. Although the findings do not put into argument the efficiency of the program, the evidence supports the argument that the real impacts on the multidimensional well-being might be occurring directly through increased income.