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181. On the Arbitrariness and Robustness of Multi-Dimensional Poverty Rankings

Author:
Mozaffar Qizilbash
Publication Date:
06-2004
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
It is often argued that multi-dimensional measures of well-being and poverty—such as those based on the capability approach and related views—are ad hoc. Rankings based on them are not, for this reason, robust to changes in the selection of weights used. In this paper, it is argued that the extent of potential arbitrariness and the range of issues relating to robustness have been underestimated in this context. Several issues relating to both the identification of the poor and the use of dimension-specific data are distinguished. These issues are then discussed in the context of the inter-provincial ranking of poverty in South Africa in 1995-6. It turns out that this ranking is fairly robust, and that some important policy-relevant results about the distinction between 'income'/'expenditure' and 'human' poverty for the South African context are reinforced rather than undermined by checking for robustness. In particular, while KwaZulu Natal is in the best three in terms of the standard expenditure measures for various choices of poverty line, it is third worst in terms of all the multi-dimensional rankings presented here.
Topic:
Economics, Human Welfare, and Poverty
Political Geography:
Africa and South Africa

182. Spatial Inequality and Development in Central Asia

Author:
Kathryn Anderson and Richard Pomfret
Publication Date:
06-2004
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
This paper focuses on inequality in living standards across oblasts and regions within Kazakhstan, the Kyrgyz Republic, Tajikistan, Turkmenistan and Uzbekistan. Regional inequality is an important area of research and policy development. Inequality in income and consumption are logical outcomes in a market-based economic system. If inequality within countries exists because of barriers to competition, then inequality can foment internal tension, and economic and social development within countries is negatively affected. We examine Living Standards Measurement data from Tajikistan, Kyrgystan, and Kazakhstan and additional survey data from Uzbekistan. We find that the most important explanations for the variation in expenditures per capita in the region are household location, household composition, and education. We find large variation in per capita expenditure by location within each country, and the differences go beyond the simple rural-urban distinction. Family structure is also important, and in all countries, having a university educated household head significantly improves household welfare; expenditures are higher in these households than in households with less educated heads. We examine inequality in access to community services and find that provision of public goods reinforces regional inequality patterns in expenditures that we measure among households. The poorest households are likely to live in communities with the lowest access to public services.
Topic:
Economics, Human Welfare, and Poverty
Political Geography:
Central Asia, Kazakhstan, Kyrgyzstan, Tajikistan, Uzbekistan, and Turkmenistan

183. Trade Liberalization and Spatial Inequality: A Methodological Innovation in Vietnamese Perspective

Author:
Henning Tarp Jensen and Finn Tarp
Publication Date:
06-2004
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
In this paper we calibrate two static computable general equilibrium (CGE) models with respectively 16 and 5,999 representative households. Aggregated and disaggregated household categories are consistently embedded in a 2000 social accounting matrix for Vietnam, mapping on a one-to-one basis to each other. Distinct differences in poverty assessments emerge when the impact of trade liberalization is analyzed in the two models. This highlights the importance of modeling micro household behavior and related income and expenditure distributions endogenously within a static CGE model framework. Our simulations indicate that poverty will rise following a revenue-neutral lowering of trade taxes. This is interpreted as a worst case scenario, which suggests that government should be proactive in combining trade liberalization measures with a propoor fiscal response to avoid increasing poverty in the short to medium term.
Topic:
Economics, Human Welfare, and Poverty
Political Geography:
Vietnam and Southeast Asia

184. Microsimulation, CGE and Macro Modelling for Transition and Developing Economies

Author:
James B. Davies
Publication Date:
06-2004
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
Alternative approaches to modelling distributional and welfare effects of changes in policy and the economic environment in developing and transition countries are surveyed. Microsimulations range from pure accounting approaches to models with behavioural equations based on econometric estimates and various dynamic models. Microsimulation accounting models are key to analysing the impact effects of tax and benefit changes and are becoming widespread. Computable general equilibrium (CGE) modelling endogenizes price changes and changes in industry and labour market structure. An essential CGE input is a social accounting matrix (SAM), which can be used to do simple multiplier analyses. A wide range of macroeconomic models have also been used in developing countries, endogenizing variables like interest rates and exchange rates.
Topic:
Development, Economics, and Human Welfare

185. Changes in Spatial Income Inequality in the Philippines: An Exploratory Analysis

Author:
Arsenio M. Balisacan and Nobuhiko Fuwa
Publication Date:
05-2004
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
The purpose of this paper is to establish some basic facts about income inequality in the Philippines, with a special focus on the importance of spatial income inequality. Despite major fluctuations in macroeconomic performances, income inequality remained relatively stable during the years 1985-2000. Spatial inequality accounts for a sizable but not overwhelming portion of the national-level income inequality, and the relative importance of spatial inequality was declining over time. We also find that mean income levels across provinces were converging at a much faster rate than those observed in currently developed countries.
Topic:
Development, Economics, and Human Welfare
Political Geography:
Philippines and Southeast Asia

186. The Medium- and Long-term Effects of an Expansion of Education on Poverty in Côte d'Ivoire: A Dynamic Microsimulation Study

Author:
Michael Grimm
Publication Date:
05-2004
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
I use a dynamic microsimulation model to analyse the distributional effects of an expansion of education in Côte d'Ivoire in the medium and long term. The simulations are performed in order to replicate several policies in force or subject to debate in this country. Various hypotheses concerning the evolution of returns to education and labour demand are tested. The direct effects between education and income as well as the different transmission channels, such as occupational choices, fertility, and household composition, are analysed. The effects of educational expansion on the growth of household incomes, their distribution and poverty depend very crucially on the hypothesis made on the evolution of returns to education and labour demand. If returns to education remain constant and the labour market segmented, the effects will be very modest.
Topic:
Economics, Education, and Human Welfare
Political Geography:
Africa

187. Economic Well-being and Non-economic Well-being: A Review of the Meaning and Measurement of Poverty

Author:
Andrew Sumner
Publication Date:
04-2004
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
This paper discusses the measurement of poverty and well-being. A historical overview is given of the last fifty years. This is followed by discussion of three groupings of indicators: those measures based primarily on economic well-being; those based on non-economic well-being and composite indicators. It is argued that the choice of indicator should reflect its purpose and that economic measures are best when quick, rough-and-ready, short run, aggregate inferences are required. In contrast, non-economic measures are better when greater depth on medium- or longer-term trends and/or dis-aggregation are required.
Topic:
Demographics, Economics, Human Welfare, and Poverty

188. Well-being and the Complexity of Poverty: A Subjective Well-being Approach

Author:
Mariano Rojas
Publication Date:
04-2004
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
This investigation studies human well-being from a subjective well-being approach. On the basis of a Mexican database the investigation shows that there is a weak relationship between subjective well-being and indicators of well-being such as income and consumption. Therefore, subjective well-being provides additional useful information to study human well-being and, in consequence, poverty.
Topic:
Economics, Human Welfare, and Poverty
Political Geography:
Latin America, Central America, North America, and Mexico

189. Income-based Measures of Average Well-being

Author:
Steve Dowrick
Publication Date:
03-2004
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
Internation comparisons of average national incomes omit important information about leisure, home production, health, etc. They are also bedevilled by index number problems. This paper suggests ways of combining working hours and life-expectancy with income comparisons, and shows that the fixed-price indexes of real income, such as those in the Penn World Table, substantially understate the income gaps between the poorest and richest countries.
Topic:
Demographics, Economics, Human Welfare, and Poverty

190. The Characteristics of Macroeconomic Shocks in the CFA Franc Zone

Author:
David Fielding, Kevin Lee, and Kalvinder Shields
Publication Date:
03-2004
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
In this paper we fit a VECM in output and prices to data from ten countries of the CFA Franc Zone. This model allows for various cross-country interactions in both the short run and the long run. The VECM parameters are used to estimate persistence profiles of different kinds, in order to identify the degree of homogeneity in the way in which the countries respond to macroeconomic shocks. In this way we can shed light on questions about the likely size of the costs incurred from these countries' membership of a monetary union.
Topic:
Economics, International Organization, International Political Economy, and International Trade and Finance
Political Geography:
Africa