Exploring challenges and opportunities with market heat maps

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Publication Date: 
15 June 2010
Pablo Acosta, Illana Melzer, Ronald U. Mendoza, Namsuk Kim, and Nina Thelen
UN Millennium Development Goal: 
Eradicate extreme poverty and hunger
Develop a global partnership for development

This paper uses survey data from six countries in order to shed further light on one aspect of the economic lives of the poor: their access to markets. It develops a framework that could be used to map market inclusiveness, and then applies this to a number of markets that are critical to reducing poverty and achieving the Millennium Development Goals (MDGs). These "market heat maps" help to illustrate the extent of the challenges and in some cases reveals potential opportunities in growing more inclusive markets in water and financial services.

What Are Market Heat Maps?

Market heat maps are simple illustrations of the extent to which the poor engage with markets: how inclusive of the poor the markets are. They provide a graphic representation of access to goods and services in selected sectors - education, water, microfinance, etc. - by the poor, along with information on how these goods and services are being provided. A greater share of poor consumers being reached is analogous to more "heat" (more color in the figure). Less heat (lack of color) indicates that a larger share of the poor are excluded. When focused on the demand side, these market heat maps show the nature and extent of consumer access to key goods and services that are important for human development across spatial dimensions in a particular country as well as the presence (or lack thereof) of various agents on the supply-side. When considering the production side, they also illustrate how inclusive markets are for the poor as producers (as entrepreneurs or as providers of labor inputs).

What do they Add?

There is already a rich literature and extensive practice in poverty mapping. So far, geographic poverty mapping has mostly been used by actors from the public and not-forprofit sphere who leverage it to highlight the geographic variations in poverty, to design and target their interventions, to pinpoint and coordinate priority areas of their operational programs and activities, to determine where to best allocate their budget, to monitor and evaluate their operations, and to increase transparency and social accountability. Amongst others, geographic poverty mapping is applied in the areas of poverty reduction operations, infrastructure provision and coordination in humanitarian crises. While poverty mapping is often used by many actors to amend the coordination of their own activities, it can also help improve the visualization of the spatial dimension of current development issues amongst external actors, including a broader public audience.

Acknowledgements: The complete published article can be found in Journal of World Business:
Pablo Acosta, Illana Melzer, Ronald U. Mendoza, Namsuk Kim, and Nina Thelen. "Business and Human Development in the Base of the Pyramid: Exploring Challenges and Opportunities with Market Heat Maps". Journal of World Business, 2011, 46 (1), 50-60.