Search

Begin New Search Topic Economics Publication Year within 25 Years

1591. The Impact of Taxes and Social Spending on Inequality and Poverty in Argentina, Bolivia, Brazil, Mexico, and Peru: A Synthesis of Results

Author:
Nora Lustig
Publication Date:
11-2012
Content Type:
Working Paper
Institution:
Center for Global Development
Abstract:
We apply a standard tax-and-benefit-incidence analysis to estimate the impact on inequality and poverty of direct taxes, indirect taxes and subsidies, and social spending (cash and food transfers and in-kind transfers in education and health). The extent of inequality reduction induced by direct taxes and transfers is rather small (2 percentage points on average), especially when compared with that found in Western Europe (15 percentage points on average). What prevents Argentina, Bolivia, and Brazil from achieving similar reductions in inequality is not the lack of revenues but the fact that they spend less on cash transfers—especially transfers that are progressive in absolute terms—as a share of GDP. Indirect taxes result in that net contributors to the fiscal system start at the fourth, third, and even second decile on average, depending on the country. When in-kind transfers in education and health are added, however, the bottom six deciles are net recipients. The impact of transfers on inequality and poverty reduction could be higher if spending on direct cash transfers that are progressive in absolute terms were increased, leakages to the nonpoor reduced, and coverage of the extreme poor by direct transfer programs expanded.
Topic:
Development, Economics, Education, Health, and Poverty
Political Geography:
Brazil, Argentina, Latin America, Mexico, Peru, and Bolivia

1592. Agricultural Decisions after Relaxing Credit and Risk Constraints

Author:
Dean Karlan, Robert Osei, Christopher Udry, and Isaac Osei-Akoto
Publication Date:
11-2012
Content Type:
Working Paper
Institution:
Center for Global Development
Abstract:
The investment decisions of small-scale farmers in developing countries are conditioned by the farmers' financial environment. Binding credit-market constraints and incomplete insurance can reduce investment in activities with high expected profits. We conducted several experiments in northern Ghana in which farmers were randomly assigned to receive cash grants, grants of or opportunities to purchase rainfall-index insurance, or a combination of the two. Demand for index insurance is strong, and insurance leads to significantly larger agricultural investment and riskier production choices in agriculture. The salient constraint to farmer investment is uninsured risk: when provided with insurance against the primary catastrophic risk they face, farmers are able to find resources to increase expenditure on their farms. Demand for insurance in subsequent years is strongly increasing in a farmer's own receipt of insurance payouts, and with the receipt of payouts by others in the farmer's social network. Both investment patterns and the demand for index insurance are consistent with the presence of important basis risk associated with the index insurance, and with imperfect trust that promised payouts will be delivered.
Topic:
Agriculture, Economics, Markets, Food, and Foreign Direct Investment

1593. Resources, risk and resilience: scarcity and climate change in Ethiopia

Author:
Alex Evans
Publication Date:
08-2012
Content Type:
Working Paper
Institution:
Center on International Cooperation
Abstract:
Ethiopia's resource scarcity context presents a daunting challenge, but also a significant opportunity. The country's current scarcity context includes: Low agricultural yields and farm sizes: Even if farm productivity were to increase by a factor of three, the average farm would still not produce enough food for a family of five. With 83% of Ethiopia's people directly dependent on agriculture for their livelihoods, the country has a major food security challenge; 7.5 million people depend on food safety nets. Major exposure to drought: Ethiopia has erratic rainfall, and acutely limited water storage capacity: the country has only 43m3 of reservoir storage per person, compared to 750m3 in South Africa and 6,150m3 in North America. Levels of irrigation are also low: the World Bank estimates that only 5% of irrigable land in Ethiopia is actually irrigated. Limited access to energy: Ethiopia's total primary energy supply is less than 60% of the African average, and only just over a fifth of the global average. The country depends on waste and biomass for 90 of its energy needs – leading to consequences including deforestation, and soil degradation as a result of biomass not being returned to the soil. High dependence on imported oil and food: Ethiopia currently imports all of its liquid fuels and a significant proportion of its food. This creates major exposure to global commodity price volatility, with the attendant risk of balance of payments problems, inflation and outright supply interruptions.
Topic:
Agriculture, Climate Change, Development, Economics, Poverty, Natural Resources, and Food
Political Geography:
Africa, South Africa, North America, and Ethiopia

1594. After austerity: futures for Europe's defence industry

Author:
Andrea Gilli
Publication Date:
11-2012
Content Type:
Policy Brief
Institution:
European Union Institute for Security Studies
Abstract:
In October 2012, the merger between BAE Systems (GB) and EADS (France, Germany and Spain), two of the biggest defence contractors in the world, failed. Despite this setback, further consolidation within the European defence industry is likely to occur in the near future. Because of the eurozone crisis, in recent years EU countries have significantly curtailed their public expenditure, defence included. This has important implications for the structure of the European defence industrial base. Specifically, defence companies are dependent on public defence expenditure. When defence spending declines, industrial overcapacity results. This, in turn, calls for restructuring and consolidation. Inevitably, EU countries will have to go down this road. However, given their ongoing concerns regarding sovereignty, technology and jobs, there are good reasons to think that they will promote the consolidation of their defence industry through a mix of Europe, NATO, extra-EU and purely national solutions.
Topic:
Defense Policy, Economics, and Industrial Policy
Political Geography:
Europe, France, Germany, and Spain

1595. The Irony of Global Economic Governance: The System Worked

Author:
Daniel W. Drezner
Publication Date:
10-2012
Content Type:
Working Paper
Institution:
Council on Foreign Relations
Abstract:
The 2008 financial crisis posed the biggest challenge to the global economy since the Great Depression and provided a severe “stress test” for global economic governance. A review of economic outcomes, policy outputs, and institutional resilience reveals that these regimes performed well during the acute phase of the crisis, ensuring the continuation of an open global economy. Even though some policy outcomes have been less than optimal, international institutions and frameworks performed contrary to expectations. Simply put, the system worked.
Topic:
Economics, Globalization, International Political Economy, Markets, Global Recession, Monetary Policy, and Financial Crisis

1596. Latino Immigrant Entrepreneurs: How to Capitalize on Their Economic Potential

Author:
Alexandra Starr
Publication Date:
07-2012
Content Type:
Working Paper
Institution:
Council on Foreign Relations
Abstract:
Latino immigrant entrepreneurs are making important contributions to the U.S. economy. They have founded highly successful companies in the frozen food, construction, financial services, and high-tech industries. Many of these companies owe their success to cultural connections with Latin American markets abroad and U.S. Latino consumers at home—markets that are set to grow rapidly in the coming years. Small-scale Latino immigrant entrepreneurs, meanwhile, have helped revitalize city commercial strips and small-town Main Streets across the country.
Topic:
Economics, Government, Markets, and Immigration
Political Geography:
Latin America

1597. A Global Trust for Rule of Law

Author:
Mark P. Lagon
Publication Date:
10-2012
Content Type:
Policy Brief
Institution:
Council on Foreign Relations
Abstract:
The rule of law is critical for people to have a meaningful opportunity to thrive. Still, for billions of people around the world today, the rule of law exists on paper but not in practice. Even though a theme for the United Nations General Assembly High-Level Panel in fall 2012 is rule of law, various UN programs devoted to rule of law have not had a transformative impact. Traditional intergovernmental institutions will never offer enough to achieve systemic change. To supplement them and achieve what they alone cannot, the United States should take the lead to forge a more nimble partnership with public, private, and nonprofit sectors and establish a Global Trust for Rule of Law (“Global Trust”). Similar to the Global Fund to Fight AIDS, Tuberculosis and Malaria (“Global Fund”), a diverse board of donor states, philanthropists, rule of law experts, and civil society representatives would run this Global Trust. Its purpose would be to build developing nations' capacity to implement rule of law and unleash the potential of marginalized groups worldwide, promoting not only human dignity but, crucially, global economic growth.
Topic:
Development, Economics, Human Rights, International Cooperation, International Law, Non-Governmental Organization, and United Nations
Political Geography:
United States

1598. ASEAN's Future and Asian Integration

Author:
Joshua Kurlantzick
Publication Date:
11-2012
Content Type:
Working Paper
Institution:
Council on Foreign Relations
Abstract:
In a region largely bereft of regional organizations and long divided by the Cold War, the Association of Southeast Asian Nations (ASEAN) has been the most significant multilateral group for the past forty-five years. Since the end of the Cold War, ASEAN has grown increasingly influential. While much of the West and most emerging markets continue to suffer because of the 2008 global recession, the leading ASEAN economies have recovered and are thriving. Perhaps most important, ASEAN has helped prevent interstate conflicts in Southeast Asia, despite several brewing territorial disputes in the region.
Topic:
Cold War, Development, Economics, Emerging Markets, and International Trade and Finance
Political Geography:
United States and Asia

1599. Bringing Stability to Europe: Why Europe needs a banking union

Author:
Erik Jones
Publication Date:
11-2012
Content Type:
Policy Brief
Institution:
Finnish Institute of International Affairs
Abstract:
The European sovereign debt crisis is the result of capital flows across the single market. The danger that such capital flows could unleash market speculation was known from the start; indeed, the single currency was created to remove the threat of exchange rate instability. The problem is that the architects of the single currency did not consider the impact of capital market integration on the banking sector or on the relationship between banks and national governments. Once markets lost confidence in the security of their cross-border investments, investors began to pull back their capital and the internal market for financial services started to disintegrate. The creation of a banking union is part of the solution. However, the euro area also needs a common 'risk-free' asset to use as a safe haven in times of crisis.
Topic:
Debt, Economics, Markets, and Financial Crisis
Political Geography:
Europe

1600. "The Political Future of the Union" Paper

Author:
Francesco Prota and Gianfranco Viesti
Publication Date:
11-2012
Content Type:
Working Paper
Institution:
Istituto Affari Internazionali
Abstract:
The main onus of responsibility for the current global economic predicament is on the financial system, not on a lack of fiscal discipline. Nonetheless, the crisis is having an extremely severe impact on the real economy, which is felt most acutely in the southern Eurozone member states. Since the end of the deepest phase of the crisis in 2009, European governments have committed themselves to fiscal consolidation. The results of these policies have been perverse: the impact of fiscal tightening during a depression may result in depressed output and high unemployment, without lowering the debt-Gross Domestic Product ratio. In light of this, we make a case for restoring growth in Europe without further delay, and discuss the role of the EU budget as an instrument for setting and implementing a real EU growth strategy.
Topic:
Economics, Globalization, International Trade and Finance, Monetary Policy, and Financial Crisis