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22. Taxation, infrastructure investment, growth, and poverty reduction: A case study of Zimbabwe
- Author:
- Hans Lofgren and Martin Cicowiez
- Publication Date:
- 03-2022
- Content Type:
- Working Paper
- Institution:
- Center for Distributive, Labor and Social Studies (CEDLAS)
- Abstract:
- In recent decades, Zimbabwe’s development record has been disappointing. In the last few years, a severe drought and the Covid-19 pandemic have added to the country’s development challenges. This paper is concerned with the long-run need to find a path toward faster growth in GDP, employment, and incomes, accompanied by more rapid progress on poverty reduction and other parts of the global sustainable development agenda. As part of this search, the country will need to address structural constraints including a large infrastructure gap, an inefficient government, and unhospitable business climate. Among these, this paper is focused on infrastructure and alternative means of financing scaled-up investments – what are the consequences of relying on domestic taxes compared to foreign financing? To address these questions, the paper draws on simulations with SDGSIM, a computable general equilibrium (CGE) model, designed for SDG analysis but applicable to analysis of policies in a wide range of areas, including growth, fiscal space, and external shocks. The model was adapted to the Zimbabwean context and calibrated to a database for 2016. The simulations cover the period 2016-2030 and analyzes the effects of alternative levels and priorities for government spending and resource mobilization (domestic and foreign). The simulation results cover a wide range of economic indicators, including some related to the global Sustainable Development Goal (SDG) agenda. The differences between the scenario results for GDP growth, household consumption, and poverty point to the importance of strong public investment management and, other things being equal, of targeting TFP gains to tradable sectors. The advantages of reliance on domestic taxation for the funding of expanded investment include slower debt accumulation and less reliance on the decisions of external actors. Tax reliance may also give the funders, the citizens, a stronger sense of ownership and right to monitor how the money is used, with a positive impact on investment productivity. On the other hand, before the investment have yielded sufficient returns, reliance on taxes reduces private purchasing power, leading to some combination of lower private consumption and investment. Raising the tax burden by 2-3 percent of GDP may also be administratively difficult. It would of course be possible to consider scenarios that split the funding burden between domestic taxes and foreign financing.
- Topic:
- Poverty, Infrastructure, Economic Growth, Tax Systems, and Investment
- Political Geography:
- Africa and Zimbabwe
23. Lebanon’s Political Economy: From Predatory to Self-Devouring
- Author:
- Lydia Assouad
- Publication Date:
- 01-2021
- Content Type:
- Working Paper
- Institution:
- Carnegie Endowment for International Peace
- Abstract:
- To survive its ongoing financial crisis, Lebanon needs a new economic system that addresses massive income inequality. Paired with political and institutional reform, tax reform can help. Over the past three decades, Lebanon’s ruling class—which comprises intertwined political and business elites—has run the country into the ground. To survive its ongoing accumulation of challenges, including the financial crisis that erupted in October 2019, Lebanon requires a revamped state backed by a new economic model with social justice at its core. Tax reform is central to such an endeavor—and to ensuring that the state has the means both to deliver basic services and to tackle poverty and inequality.
- Topic:
- Poverty, Inequality, Economic structure, Business, Social Justice, Tax Systems, and Elites
- Political Geography:
- Middle East and Lebanon
24. The unequal inequality impact of the COVID-19 pandemic
- Author:
- Zsolt Darvas
- Publication Date:
- 03-2021
- Content Type:
- Working Paper
- Institution:
- Bruegel
- Abstract:
- GDP contractions are typically associated with within-country income inequality increases. While official income inequality data for 2020 will not be available for about two years, the already available employment data for 2020 shows that the difference between highly-educated and low-educated people in terms of job losses is correlated with the economic shock from the COVID-19 pandemic, suggesting that the depth of the economic recession is related to the increase in within-country income inequality in 2020. Scenarios based on historical patterns of recessions and within-country income inequality increases suggest relatively small increases in global income inequality in 2020. Factors mitigating global inequality increases in 2020 include larger GDP per-capita declines in richer advanced countries than in poorer emerging and developing countries, and the positive GDP growth of China, which suggests that within-country inequality in the world’s most populous country might have not changed much in 2020. In contrast, it is quite likely there was a significant increase in European Union income inequality in 2020, partly reversing the decline during the previous decades.
- Topic:
- Poverty, European Union, Employment, Inequality, and COVID-19
- Political Geography:
- Europe
25. Establishing the empirical basis for tracing the development outcomes of agricultural investments
- Author:
- Helle Munk Ravnborg, Bernard Bashaasha, Rikke Broegaard, Michael Byaruhanga, Evelyne Lazaro, Festo Maro, Khamaldin Mutabazi, Teddy Nakanwagi, and David Tumusiime
- Publication Date:
- 04-2021
- Content Type:
- Working Paper
- Institution:
- Danish Institute for International Studies (DIIS)
- Abstract:
- This DIIS Working Paper describes the design of a questionnaire survey developed and implemented in order to trace the development outcomes of foreign agricultural investments in six research locations in Tanzania and Uganda. The questionnaire survey was conducted as part of the Agricultural Investors as Development Actors (henceforward AIDA) research programme which, in particular, focuses on development outcomes in terms of employment, migration, food security and wider dynamic economic effects, such as access to technology, infrastructure and markets; land markets and perceived security of land tenure; and water access and security of tenure. The working paper which serves as a methodological reference document describes the approach which was employed for drawing six independent samples of 400 respondents each, as well as the approach developed for computing a foreign agricultural investment exposure index and for computing a locally informed household poverty index.
- Topic:
- Agriculture, Climate Change, Development, Economics, Emerging Markets, Environment, Poverty, Water, Food, Governance, Inequality, Investment, and Land Rights
- Political Geography:
- Sub-Saharan Africa and Africa
26. Eliminating child marriage in Ethiopia
- Author:
- Fana Gebresenbet
- Publication Date:
- 06-2021
- Content Type:
- Working Paper
- Institution:
- Danish Institute for International Studies (DIIS)
- Abstract:
- How can we explain the large gap between national legal and policy commitments to reduce and eliminate gender-based violence (GBV) and the reality and practice of GBV in Ethiopia? Hitherto explanations mainly centre on the conflict between and social and official norms, and the stubbornness of the former. In this new DIIS Working Paper, Fana Gebresenbet tries to go beyond this dichotomy to examine what happens in the ‘in-between spaces’. While the stubbornness of social norms only brings home to us the slow pace of change, it does not tell us what guides the emerging practices that contribute towards change. Instead, ‘practical norms’ are used here as an analytical tool to examine what happens as we move along the continuum from social to official norms. This helps us capture why routinised, coordinated and socially acceptable new practices occur before the major social norms change. This work is part of GLOW (Global Norms and Violence Against Women in Ethiopia), a research programme financed by the Danish Ministry of Foreign Affairs and coordinated by DIIS.
- Topic:
- Development, Diplomacy, International Organization, Poverty, Children, Women, and Inequality
- Political Geography:
- Africa and Ethiopia
27. Nature-based solutions to development and climate change challenges: Understanding ecosystem-based adaptation approaches
- Author:
- Marie Ladekjær Gravesen and Mikkel Funder
- Publication Date:
- 08-2021
- Content Type:
- Working Paper
- Institution:
- Danish Institute for International Studies (DIIS)
- Abstract:
- Nature-based Solutions (NbS) to climate- and development-related challenges have recently gained attention in development cooperation. Among other, approaches that fall under the NbS umbrella include Ecosystem-based Adaptation (EbA), Ecosystem-based Mitigation (EbM) and Ecosystem-based Disaster Risk Reduction (Eco-DRR). This new DIIS Working Paper focuses on nature-based solutions to climate change adaptation, EbA. It provides an overview of selected lessons learnt from EbA in the context of development cooperation, with a particular emphasis on the opportunities and risks regarding poverty alleviation and rights. It generates learning for Danish development cooperation, including future programming under Denmark’s 2021 development strategy, in which NbS approaches are emphasised. However, the paper can also be read as a general discussion of experiences with EbA in the development context. The three-legged EbA approach focuses on human well-being, ecosystem management, and climate change adaptation. EbA has already been applied to a range of ecosystems, including the restoration of mangroves to shield them against storm and sea-level rises, the management of watersheds to protect against droughts and flooding, the management of rangelands to inhibit desertification and land degradation, and more sustainably managed fisheries and forestry to tackle food insecurity. EbA thus not only addresses the restoration of already degraded ecosystems, but also the sustainable use, management, and conservation of intact ecosystems. The paper provides a conceptual overview of EbA in relation to NbS, outlines the potential in using EbA approaches, and describes the landscape of the institutions and agencies that fund, promote and implement EbA. The paper then provides a synthesis of lessons learned from PES and REDD+ schemes that are of relevance to EbA. For instance, it is emphasised that many REDD+ measures have effectively existed as project islands that were not anchored in national or subnational planning and governance mechanisms. As a result, the conservation activities and socioeconomic benefits were often not effectively integrated or scaled up beyond small project sites. If comprehensively implemented, the EbA approach builds on these experiences by insuring full inclusion of stakeholders from all relevant sectors, as well as demanding full integration in existing policies, planning and governance practices from the ministry levels to sub-national governments. Among the final recommendations and possible entry points for Danish development cooperation, the paper highlights that the support must have a strong focus on ensuring that EbA is pro-poor (i.e. supports poverty alleviation) and rights-based (i.e. supports the rights of local resource users). Experience from EbA and related efforts show that EbA is not automatically pro-poor or supportive of local rights to natural resources and ecosystem services. In particular, there is insufficient attention to and knowledge of rights issues in EbA. Therefore, Danish development cooperation should help lead the way in ensuring that EbA takes a rights-based approach and supports poverty alleviation.
- Topic:
- Agriculture, Climate Change, Development, Environment, Poverty, Natural Resources, Water, Food, Governance, Inequality, Investment, and Land Rights
- Political Geography:
- Global Focus
28. Social protection, caste and ethnicity in Nepal: A new social contract or an old political settlement?
- Author:
- Neil Anthony Webster
- Publication Date:
- 01-2021
- Content Type:
- Working Paper
- Institution:
- Danish Institute for International Studies (DIIS)
- Abstract:
- Social protection programmes in Nepal have increased significantly in the past two decades, but are they the programmes for change that they claim to be? Do the social transfers involved help in reducing forms of inequality or do they reproduce existing hierarchies and dominant social and economic interests? Are the changes introduced sustainable and if so, for whom? This Working Paper takes up the experiences in Nepal with its complex caste and ethnic structures. It considers the possibility that these programmes might be reproducing existing social hierarchies and thereby run counter to the aims and objectives that they are designed to pursue.
- Topic:
- Development, Poverty, Inequality, Ethnicity, Caste, and Society
- Political Geography:
- South Asia and Nepal
29. Both hard and soft corporate practices construct and secure industrial mining operations: The case of Colombia
- Author:
- Line Jespersgaard Jakobsen
- Publication Date:
- 01-2021
- Content Type:
- Working Paper
- Institution:
- Danish Institute for International Studies (DIIS)
- Abstract:
- This DIIS Working Paper elaborates how local consent to a huge industrial mining complex, including a port and a 150 km railway built in the 1980’s on indigenous arid lands, were created. Showing how both ‘hard’ and ‘soft’ security technologies were effective in preparing the complex, constructing the necessary infrastructure and securing the operation, the paper at the same time illustrates how corporate security practices have changed over time in the northern part of Colombia. The paper is based on extended ethnographic fieldwork in La Guajira, Colombia, carried out through 2018 and 2019 as well as historical written documents.
- Topic:
- Security, Environment, Oil, Poverty, Natural Resources, Non State Actors, Gas, Capitalism, Inequality, Economy, Conflict, Ethnography, Violence, Investment, Justice, Land Rights, and Minerals
- Political Geography:
- Colombia, South America, and Latin America
30. Preparatory Study for the Evaluation of Denmark's Development Cooperation on Climate Change Adaptation: Overviews and analysis of Danish support to adaptation from 2008-2018
- Author:
- Lily Salloum Lindegaard, Mikkel Funder, and Esbern Friis-Hanse
- Publication Date:
- 02-2021
- Content Type:
- Working Paper
- Institution:
- Danish Institute for International Studies (DIIS)
- Abstract:
- The Evaluation of Danish Support to Climate Change Adaptation in Developing Countries has just come out. But what knowledge does it build on and what fundamental questions does it explore? This Preparatory Study, commissioned by the EVAL Department of Denmark’s Ministry of Foreign Affairs in 2019, lays the groundwork for the evaluation. It sought to help define the scope of the evaluation; identify potential country case studies, case projects and evaluation themes; and point out overarching issues and questions to be addressed in the evaluation. To do so, the study provides overviews of all Danish climate change adaptation-related Official Development Assistance (ODA) from 2008 to 2018 and of adaptation support through the Danish Climate Envelope, which provides Fast Start Finance for climate change mitigation and adaptation in developing countries. The study also includes an analysis of trends and gaps in the Climate Envelope. These, and other outputs from the study, are now available in this DIIS Working Paper. The paper’s analysis and findings continue to have relevance for discussions of how we approach climate change, particularly adaptation, in Danish development assistance.
- Topic:
- Climate Change, Development, Environment, Poverty, and Inequality
- Political Geography:
- Europe and Denmark