In East and Southeast Asia, a strong and growing interest exists in asset building as a social and economic development strategy.
In its simplest form, asset building refers to strategies that increase financial and tangible assets, such as savings, homes and businesses of all kinds. Asset building focuses on long-term development of families.
The Center for Social Development (CSD) at Washington University’s Brown School is advising and helping to test innovations in asset building in several countries.
“Much of the East and Southeast Asia region is still in a process of defining its social policies,” says Michael Sherraden, Ph.D., the Benjamin E. Youngdahl Professor of Social Development and director of the CSD.
“Rather than automatically adopting social policies of the West, countries in this region are looking for policies suited to their economies and social arrangements,” Sherraden says.
“In some sense, these countries are ‘open’ to social innovation — they are trying things out,” he says. “This is not always a smooth process, but one of the positive features is testing new models of social policy. Although asset-based policy was defined in the West, it is getting at least as much traction in East and Southeast Asia.”
Sherraden is the creator of one of the leading asset building policies — individual development accounts (IDAs) — which are accounts with matched savings. IDAs are similar to 401(k)s, except that they are designed to be available to all with progressive matching for low-income families and can be started as early as birth.
CSD has worked with many scholars in Asia who have been the pioneers and the driving forces of promoting asset-based social development strategy. CSD’s research findings in the United States with low-income peopulations have informed policy innovations by Asian governments, leading to adoption of asset building as one component of their social policies.
Examples of progress in Asia
- Singapore now has a comprehensive and innovative cradle-to-grave asset-building policy, in which matched savings accounts are used to fund education for children, home purchase and retirement.
- Increasing scholarship and research evidence on IDAs within South Korea is yielding promising results.
- In Seoul, the IDA program has expanded to 20,000 accounts completed in December 2009, with plans to add another 10,000 accounts in 2010.
- The government of South Korea recently has instituted a national asset-building policy for institutionalized children.
- The city government of Seoul has implemented an asset-building initiative that is focused on low-income households, and other cities in Korea have followed suit.
- Research evidence on Family Development Accounts in Taipei continues to be encouraging, and matched savings has spread to several other cities in Taiwan.
- CSD assisted the Taipei city government with policy and research design for a pilot asset-building program that was modeled after U.S.-based IDA programs.
- A demonstration and research on child development accounts for low-income families continues in Hong Kong.
- A non-governmental organization has met with the CSD to discuss creating child development accounts in Macao.
- The Hutubi Rural Social Security Loan Program, which enables participants to borrow for their agricultural production or other life investments using their social security cards as collateral, has expanded from Xinjiang province to several other provinces in China.
- The Brown School is partnering in the Sichuan earthquake region. General themes of asset building and capacity building have been adopted for this work. The Brown School’s ties with Hong Kong Polytechnic University makes this partnership possible.
Research on asset building in Asia is directly connected to CSD’s work on asset-based social development strategies in the United States and the rest of the world.
Singapore’s universal approach to asset building for all children, for example, informs CSD’s “SEED for Oklahoma Kids” experiment, which tests the idea of giving every child an asset-building account at birth. In a consortium led by Save the Children, CSD is planning to test youth savings accounts in four developing countries.
Asset building is not the only area of CSD’s work in Asia. Productive aging is a growing research field. Under the leadership of Nancy Morrow-Howell, Ph.D., the Ralph and Muriel Pumphrey Professor of Social Work, and Gao Jianguo, Ph.D., professor at Shandong University, the CSD and Shandong University organized the first national conference on productive aging in China, held in July 2009 in Jinan, the capital of Shandong province.
At the Brown School, CSD’s international work attracts students from around the world. Current students and alumni are a growing influence in the design and testing of social policy in several Asian nations. Other students have learned from research on asset building in Asia to inform studies in other areas of the world.