What is the Distributional Impact Assessment + (DIA +)?
In 2023, the European Commission adopted the Distributional Impact Assessment tool (DIA) as part of the Inequality Marker methodology. Later on, in 2024, the Distributional Impact Assessment + (DIA+) was developed to effectively identify the income or consumption distribution of target populations. The DIA and the DIA+ share some common characteristics. Both provide an evidence-based assessment on the potential inequality-reducing effects of a development intervention. The DIA can inform ex ante, during the design phase, and ex post, whether the poorest 40 per cent have been targeted. An intervention might have multiple components, but the DIA can be performed only on those for which it is possible to identify the targeted beneficiaries. Contrary to the DIA+, the DIA only provides information about the beneficiaries’ assets (e.g. cars, computers, etc.), which typically serve as the basis for estimating wealth status. To determine whether direct beneficiaries of development interventions are at the bottom 40 per cent of the wealth distribution, the DIA relies on the Equity Tool (EQT). The EQT is a quick, low-cost and user-friendly tool that measures relative wealth (or household assets) based on nationally representative survey data from Demographic Health Surveys, Multiple Indicator Cluster Surveys, and other household surveys with information on household assets. The EQT relies on a small set of questions (around 10-15), which help identify the wealth quintile of the individual (in line with SDG 10.1.1). Yet, the asset-based DIA has some limitations. In addition to requiring the availability of up-to-date survey data, including asset-related information, the DIA also does not provide a complete understanding of the socio-economic status of a beneficiary, overlooking key aspects such as income or consumption. Faced to these limitations, DG INTPA G4 developed the DIA+, capable of rigorously and cost-effectively assessing the income or consumption expenditure levels, rather than solely focusing on their assets. The DIA+ should therefore be seen as an updated version of the DIA, complementary rather than replacing it. Thanks to the DIA and the DIA+, it is possible to now have a complete picture of the socio-economic impacts of programs by assessing either the wealth, income, or consumption quintiles of your program’s beneficiaries.