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51. Measuring the Capability to Raise Revenue. Process and Output Dimensions and Their Application to the Zambia Revenue Authority

Author:
Christian von Soest
Publication Date:
12-2006
Content Type:
Working Paper
Institution:
German Institute of Global and Area Studies
Abstract:
The worldwide diffusion of the good governance agenda and new public management has triggered a renewed focus on state capability and, more specifically, on the capability to raise revenue in developing countries. However, the analytical tools for a comprehensive understanding of the capability to raise revenue remain underdeveloped. This article aims at filling this gap and presents a model consisting of the three process dimensions 'information collection and processing', 'merit orientation' and 'administrative accountability'. 'Revenue performance' constitutes the fourth capability dimension which assesses tax administration's output. This model is applied to the case of the Zambia Revenue Authority. The dimensions prove to be valuable not only for assessing the how much but also the how of collecting taxes. Theycan be a useful tool for future comparative analyses of tax administrations' capabilities in developing countries.
Topic:
Development, Economics, and Third World
Political Geography:
Africa, Zambia, and Holland

52. How Does Neopatrimonialism Affect the African State? The Case of Tax Collection in Zambia

Author:
Christian von Soest
Publication Date:
11-2006
Content Type:
Working Paper
Institution:
German Institute of Global and Area Studies
Abstract:
Following the neopatrimonialism paradigm, it can be hypothesised that in African states informal politics of the rulers infringe on the collection of taxes and in turn reduce state revenues. This article tests this proposition for the case of Zambia. The main finding is that there is no linear correlation between a neopatrimonial system and the collection of taxes. Neopatrimonial continuity in the country is evidenced by three factors; the concentration of political power, the award of personal favours and the misuse of state resources. Despite this continuity, the revenue performance has increased considerably with the creation of the semi-autonomous Zambia Revenue Authority. This demonstrates that the effect of neopatrimonialism on public policy in the African state is highly context-specific and dependent on the interaction with additional variables. Donor pressure has been the most important in the Zambian case. In order to apply neopatrimonialism for further empirical work on public policy in the African state, these additional variables have to be incorporated into the analysis.
Topic:
Civil Society, Economics, and Politics
Political Geography:
Africa, Zambia, and Holland

53. Decentralisation in Uganda: Exploring the Constraints for Poverty Reduction

Author:
Susan Steiner
Publication Date:
11-2006
Content Type:
Working Paper
Institution:
German Institute of Global and Area Studies
Abstract:
It is often claimed that decentralisation is effective for the reduction of poverty due to inherent opportunities for higher popular participation and increased efficiency in public service delivery. This paper is a qualitative assessment of the potential of the Ugandan decentralisation reform for poverty alleviation. The Ugandan government initiated an ambitious decentralisation reform in 1992, which represents an example of full-fledged devolution with the transfer of far-reaching responsibilities to local governments. However, several shortcomings, such as low levels of accountability, insufficient human and financial resources, corruption, patronage, and central resistance to decentralisation, constrain the proper implementation of the reform, putting improvements in participation and efficiency at risk and ultimately jeopardising the intended impact on poverty.
Topic:
Economics, Humanitarian Aid, and Poverty
Political Geography:
Uganda and Africa

54. Economic Growth and Poverty: Does Formalisation of Informal Enterprises Matter?

Author:
Robert Kappel and Esther Ishengoma
Publication Date:
04-2006
Content Type:
Working Paper
Institution:
German Institute of Global and Area Studies
Abstract:
The informal sector (IS) plays a significant role in developing countries viz. the provision of employment, income and supplying ignored markets. However, working and employment conditions within the sector are still poor. Its expansion and changing structures have thus drawn the attention of scholars and international policy makers to the factors hindering its formalisation. Among the factors addressed are the high costs of formalisation and the lack of incentives for operating in the formal sector. A variety of approaches have been adopted by different stakeholders to overcome these factors. This paper assesses these approaches along with the factors related to informality-formality trade-off and the issue of formalisation as a solution for firms' growth. By focussing on the problems faced by informal enterprises and the literature which addresses the options for accelerating the formalisation of informal enterprises, the paper will briefly summarise the weaknesses of these approaches.
Topic:
Economics, Markets, Politics, and Poverty

55. A Paradox of Plenty? Rent Distribution and Political Stability in Oil States

Author:
Matthias Basedau and Lacher Wolfram
Publication Date:
04-2006
Content Type:
Working Paper
Institution:
German Institute of Global and Area Studies
Abstract:
Resource curse theory claims that resource abundance encourages violent conflict. A study of 37 oil-producing developing countries, however, reveals that oil states with very high levels of oil revenue are remarkably stable. An analysis of the ways in which governments spend oil revenues identifies two distinct types of rentier systems – the large-scale distributive state and the patronage-based system – which are strongly linked to instability or its absence. However, some deviant cases, such as Equatorial Guinea and Gabon, illustrate the need for further research. Apparently, the notion of a “paradox of plenty” has neglected rentier mechanisms that avoid conflict.
Topic:
Economics, Government, Industrial Policy, and Politics

56. Regional Monetary Integration among Developing Countries: New Opportunities for Macroeconomic Stability beyond the Theory of Optimum Currency Areas?

Author:
Laurissa Muhlich and Barbara Fritz
Publication Date:
12-2006
Content Type:
Working Paper
Institution:
German Institute of Global and Area Studies
Abstract:
Optimum Currency Area (OCA) approaches turn to be inadequate in the analysis of the new regional monetary integration schemes that have sprung up among developing and emerging market economies. Instead, in accordance with the concept of 'original sin' (Eichengreen et al.) we argue that regional monetary South-South integration schemes that, unlike North-South arrangements, involve none of the international reserve currencies, have specific monetary constraints and implications which need to be duly considered. A first comparative analysis of three cases of monetary South-South cooperation in South Africa (CMA), East Asia (ASEAN) and Latin America (Mercosur) shows that these can indeed provide macroeconomic stability gains but that this strongly depends on the existence of economic hierarchies within these integration schemes.
Topic:
Development, Economics, Foreign Exchange, and Third World
Political Geography:
East Asia, South Africa, and Latin America

57. Decentralisation and Poverty Reduction: A Conceptual Framework for the Economic Impact

Author:
Susan Steiner
Publication Date:
06-2005
Content Type:
Working Paper
Institution:
German Institute of Global and Area Studies
Abstract:
This paper contributes to providing insights into the impact of decentralisation on poverty. It starts out with an overview of which role decentralisation plays in strategies and policies for poverty eradication and derives economic and political impact channels. It concentrates on the economic channel, the reasoning of which is rooted in fiscal federalism theory. It shows that decentralisation cannot only influence poverty by assigning expenditure responsibility to lower levels of government but also by assigning tax-raising power, which has so far been neglected by the literature. The paper concludes by pointing out a number of possible risks for realising the poverty-reducing potential of decentralisation.
Topic:
Development, Economics, International Trade and Finance, and Poverty