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on Central and South America |
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Issue of 2017‒03‒05
ten papers chosen by |
| By: | Claudiney Pereira (Arizona State University) |
| Abstract: | Fiscal policy played an important role in reducing poverty and inequality in Brazil (Higgins and Pereira, 2014) over the last fifteen years, but how much redistribution and poverty reduction is being accomplished across ethnic groups? How was the ethno-racial divide affected by fiscal policy? We estimate the effects of taxes and social spending on inequality and poverty among ethnic groups using household survey. We find that direct transfers have similar effects on inequality across ethnic groups, but the reduction is larger for pardos after adding the monetized in-kind benefits (health and education). However, the income ratio between whites and non-whites is virtually unchanged. Poverty is reduced after direct transfers, but the reduction is higher for whites despite the prevalence of poverty is at least twice as high among pardos, blacks, and indigineous. The positive effects on poverty is tempered by a deleterious effect from indirect taxes. In addition, per capita transfers are on average higher for whites and benefits can twice as large as those for non-whites. Fiscal interventions did not have a significant impact in reducing the divide between whites and non-whites in Brazil. |
| Keywords: | Fiscal policy, great divide, Brazil, inequality, ethno-racial |
| JEL: | D31 H22 I32 O54 |
| Date: | 2016–11 |
| URL: | https://d.repec.org/n?u=RePEc:tul:ceqwps:60&r=lam |
| By: | Margarita Beneke (FUSADES, El Salvador); Nora Lustig (Stone Center for Latin American Studies, Department of Economics, Tulane University.); Jose Andres Oliva (FUSADES, El Salvador) |
| Abstract: | We conducted a fiscal impact study to estimate the effect of taxes, social spending, and subsidies on inequality and poverty in El Salvador, using the methodology of the Commitment to Equity project. Taxes are progressive, but given their volume, their impact is limited. Direct transfers are concentrated on poor households, but their budget is small so their effect is limited; a significant portion of the subsidies goes to households in the upper income deciles, so although their budget is greater, their impact is low. The component that has the greatest effect on inequality is spending on education and health. Therefore, the impact of fiscal policy is limited and low when compared with other countries with a similar level of per capita income. There is room for improvement using current resources. |
| Keywords: | fiscal incidence, poverty, inequality, El Salvador |
| JEL: | D31 H22 I14 |
| Date: | 2016–11 |
| URL: | https://d.repec.org/n?u=RePEc:tul:ceqwps:57&r=lam |
| By: | Nora Lustig (Stone Center for Latin American Studies, Department of Economics, Tulane University, Commitment to Equity Institute (CEQI).) |
| Abstract: | Current policy discussion focuses primarily on the power of fiscal policy to reduce inequality. Yet, comparable fiscal incidence analysis for twenty-eight low and middle income countries reveals that, although fiscal systems are always equalizing, that is not always true for poverty. In Ethiopia, Tanzania, Ghana, Nicaragua, and Guatemala the extreme poverty headcount ratio is higher after taxes and transfers (excluding in-kind transfers) than before. In addition, to varying degrees, in all countries a portion of the poor are net payers into the fiscal system and are thus impoverished by the fiscal system. Consumption taxes are the main culprits of fiscally-induced impoverishment. Net direct taxes are always equalizing and indirect taxes net of subsidies are equalizing in nineteen countries of the twenty-eight. While spending on pre-school and primary school is pro-poor (i.e., the per capita transfer declines with income) in almost all countries, pro-poor secondary school spending is less prevalent, and tertiary education spending tends to be progressive only in relative terms (i.e., equalizing but not pro-poor). Health spending is always equalizing but not always propoor. More unequal countries devote more resources to redistributive spending and appear to redistribute more. The latter, however, is not a robust result across specifications. |
| Keywords: | Fiscal incidence, social spending, inequality, poverty, developing countries |
| JEL: | H22 H5 D31 I3 |
| Date: | 2017–01 |
| URL: | https://d.repec.org/n?u=RePEc:tul:ceqwps:54&r=lam |
| By: | Nora Lustig (Stone Center for Latin American Studies, Department of Economics, Tulane University.) |
| Abstract: | Here, I examine the level, redistributive impact and pro-poorness of government spending on education and health for thirteen developing countries from the Commitment to Equity project. Social spending as a share of total income is high by historical standards, and it rises with income per capita and income inequality. Spending on education and health lowers inequality and its marginal contribution to the overall decline in inequality is, on average, 69 percent. There appears to be no “Robin Hood Paradox:” redistribution increases with income inequality, even if one controls for per capita income. Concentration coefficients indicate that spending on pre-school, primary and secondary education is pro-poor in twelve countries. Spending on tertiary education is regressive and unequalizing in three countries, and progressive and equalizing (but not pro-poor) in ten. Health spending is pro-poor in five countries. Of the remaining eight, health spending per capita is roughly equal across the income distribution in three, and progressive and equalizing (but not pro-poor) in five. |
| Keywords: | fiscal incidence, social spending, inequality, developing countries |
| JEL: | H22 D31 I3 |
| Date: | 2015–03 |
| URL: | https://d.repec.org/n?u=RePEc:tul:ceqwps:30&r=lam |
| By: | Sandra Martinez-Aguilar (Commitment to Equity Institute (CEQI)); Alan Fuchs (World Bank); Eduardo Ortiz-Juarez (Doctoral Student in the Department of International Development at King’s College London, and Research Associate at the CEQ Institute (CEQI)); Giselle Del Carmen (World Bank) |
| Abstract: | This paper applies a comprehensive tax-benefit incidence analysis to estimate the distributional effects of fiscal policy in Chile in 2013. Four results are indicative of an overall positive net effect of fiscal interventions on poverty and inequality. First, subsidies exert a positive, yet modest effect on poverty and inequality, whereas direct transfers are progressive, equalizing, and reduce the poverty headcount by 4 to 5 percentage points, depending on the poverty line used. Second, although social contributions are unequalizing and poverty-increasing, direct taxes on personal income are equalizing and poverty neutral, whereas indirect taxes are poverty-increasing but exert a counterintuitive, yet feasible equalizing effect known as Lambert’s conundrum. Third, social spending on tertiary education is slightly equalizing but it is not pro-poor, contrary to the effects of social spending on basic and secondary education and health, which are not only equalizing but also pro-poor. Finally, the net effect of Chile’s tax/transfer system leaves fewer individuals impoverished relative to the number of fiscal gainer |
| Keywords: | Fiscal Policy and Inequality, Income Inequality, Poverty, Social Assistance, Taxation |
| JEL: | D31 I32 |
| Date: | 2017–01 |
| URL: | https://d.repec.org/n?u=RePEc:tul:ceqwps:46&r=lam |
| By: | Darío Rossignolo (University of Buenos Aires) |
| Abstract: | Using standard fiscal incidence analysis, this paper estimates the impact of tax and expenditure policies on income distribution and poverty in Argentina with data from the National Household Survey on Incomes and Expenditures 2012-2013. The results show that fiscal policy has been a powerful tool in reducing inequality and poverty but that the unusually high levels of public spending may make the programs unsustainable. |
| Keywords: | Taxes, public expenditures, inequality, poverty |
| JEL: | H2 I3 D3 |
| Date: | 2016–05 |
| URL: | https://d.repec.org/n?u=RePEc:tul:ceqwps:45&r=lam |
| By: | Camila Arza |
| Abstract: | Over the past two decades, many Latin American countries have expanded the economic protection of older adults by developing non-contributory pensions or making eligibility rules more flexible. These policies have addressed long-standing coverage gaps in Latin American pension systems and contributed to incorporating a large number of older adults in the social protection system. The paper examines the main design features of non-contributory pensions and how they interact with pre-existing contributory systems. It identifies the different types of coverage expansion strategies across Latin America and discusses three different country experiences—Argentina, Bolivia, and Colombia—in greater detail. |
| Date: | 2017 |
| URL: | https://d.repec.org/n?u=RePEc:unu:wpaper:wp2017-29&r=lam |
| By: | Patricia Carballo (Banco Central del Uruguay); José Ignacio González (Banco Central del Uruguay); Margarita Güenaga (Banco Central del Uruguay); José Mourelle (Banco Central del Uruguay); Gabriela Romaniello (Banco Central del Uruguay) |
| Abstract: | This paper presents the characteristics of Modelo de Proyecciones Macroeconómicas (MPM), which allows both forecasts and simulations of macroeconomic variables. It is a New Keynesian model with price stickiness. Therefore, movements in the nominal sector, and especially in monetary policy, may have effects on real variables in the economy in the short term. We also analyze the relationships among the model variables when a money market is included and the effects of imposing two alternative rules of monetary policy. The first rule is based on an interest rate (Taylor), and the second in monetary aggregates (McCallum) |
| Keywords: | Semi structural model, monetary aggregates, policy rule, Uruguay; Modelo semi estructural, agregados monetarios, regla de política, Uruguay |
| JEL: | E23 O47 |
| Date: | 2015–12 |
| URL: | https://d.repec.org/n?u=RePEc:bku:doctra:2015012&r=lam |
| By: | Ocampo, José Antonio.; Gómez-Arteaga, Natalie. |
| Abstract: | En este documento se analizan los efectos positivos de los recientes esfuerzos por expandir y ampliar los sistemas de protección social (SPS) sobre la reducción de la pobreza y la desigualdad en la región. Los SPS han mejorado, tanto en términos de cobertura como en el alcance de la protección que ofrecen, lo que ha permitido la adquisición de nuevas dimensiones en la mayoría de los países de América Latina. Sin embargo, todavía existen importantes desigualdades en el acceso a la protección social en función del tipo de empleo y el nivel de ingresos. La cobertura contributiva todavía es baja y una proporción significativa de la población sigue desprotegida. Al mismo tiempo, la protección social no contributiva, aunque con una cobertura mayor, proporciona pocos beneficios. En este contexto, la incidencia del gasto social originada en transferencias directas es todavía baja, especialmente si se compara con la correspondiente a los países desarrollados. Para lograr una cobertura universal, resulta esencial una expansión de los SPS, basada en una combinación de esquemas no contributivos y contributivos. |
| Keywords: | social protection, social security, poverty alleviation, equal rights, economic development, Latin America |
| Date: | 2016 |
| URL: | https://d.repec.org/n?u=RePEc:ilo:ilowps:994944990202676&r=lam |
| By: | Carriazo, Fernando; Gomez, John Alexander |
| Abstract: | Using a (second stage) hedonic housing model, this paper identifies an inverse demand function for air quality in Bogota, the fourth most polluted city in Latin America (annual average of PM10 52 mg/m3). We use precipitation and distance to monitoring stations as instruments for pollution. We found that the monthly benefits of compliance with the U.S Environmental Pollution Agency standard (50 mg/m3 – annual average), and the far more stringent World Health Organization standard (20 mg/m3 – annual average) are U$7.12 and U$72.91per household respectively. Accordingly, these values represent about 1% and 8% of the average household income. |
| Keywords: | air pollution, hedonic models, housing markets, Environmental Economics and Policy, Q51 Q53 R31, |
| Date: | 2015–11–17 |
| URL: | https://d.repec.org/n?u=RePEc:ags:ulaedd:212855&r=lam |