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531. Analysis of Poverty and Inequality in Bolivia, 1999-2005: A Microsimulation Approach

Author:
Claudia Gutierrez
Publication Date:
01-2008
Content Type:
Working Paper
Institution:
Institute for Advanced Development Studies (INESAD)
Abstract:
This paper studies the changes in inequality and poverty in the period 1999-2005 in Bolivia through the analysis of the changes in the labour market. A decomposition method based on micro-simulation techniques was applied. The decomposition works with an income generation model at the household level, which is a set of equations for the individual earnings and for the labour supply and occupational choices for each member of the household. We decomposed the observed change in inequality into four components: i) a shift in the income distribution related to a change in employment rates and the shares of wage and non-wage labour among the employed population (participation effect); ii) a shift related to changes in the remuneration of observed characteristics of the employed population (price effect); iii) a shift related to a change in the distribution of error terms of estimated earnings functions (error term effect); and iv) a residual change in inequality not captured by the first three simulated changes in the income distribution. According to our results the increase in inequality of 3 points of the Gini coefficient, was explained by approximately 1 point for the participation, price and error term effects and 2 points for the residual change. The increase in the unemployment rate, the shift in the participation of the non wage earners, the rise in wages and the more unequal distribution of unobserved productive talents deteriorated the income distribution in this period in Bolivia. Regarding the poverty incidence, the observed variation was a reduction by 3 points explained mainly by the residual change. The low magnitude of the simulated effects as determinants of the decline in poverty in those years can be explained by the rising participation of the non labour incomes in the total household income.
Topic:
Development, Economics, Poverty, Inequality, and Simulation
Political Geography:
South America and Bolivia

532. Good and Bad News on Global Development

Author:
Dani Rodrik
Publication Date:
04-2008
Content Type:
Working Paper
Institution:
MIT Center for International Studies
Abstract:
Istart with some good news, because there is, I think, a lot of good news in the world of development. Then I want to present what I think is essentially a paradox. The paradox, to put it very crudely, is that while economic development is working, development policy is not. Let me start with the good news. If you look at the total number of people who live on below $1 a day and look at the trend, between 1981 and 2001, what you see is basically that there are now roughly 400 million fewer people who live below the $1-a-day line. So there actually has been not just a relative reduction in the number of the absolute poor; there has actually been an absolute reduction in the number of the absolute poor. This is in a period when, of course, the population of the developing world has increased quite significantly. In terms of the somewhat higher poverty line, which is the $2-a-day line, the number of poor people below that threshold has actually increased somewhat, but it is still the case that relative to the population of the developing world, it has come down. That is basically good news. In this period, there has been, in fact, significant poverty reduction around the world. But if you look at where that has come from, it is also the case that much of it has actu- ally been localized. China alone accounts for the full 400 million-person reduction in absolute poverty when measured by the $1-a-day line. If you take China out, basically, in the rest of the world, some countries have had an increased number of poor people, others have had a decline.
Topic:
Development, Poverty, Inequality, and Population Growth
Political Geography:
Global Focus

533. Improving Agricultural Efficiency Amongst Groundwater Users: The Case of Sugarcane in North India *

Author:
Gauri Khanna
Publication Date:
05-2007
Content Type:
Journal Article
Journal:
Journal of Public and International Affairs (JPIA)
Institution:
School of Public and International Affairs (SPIA), Princeton University
Abstract:
This paper estimates inequities in production and income for different categories of water users in the context of a rapidly depleting resource by estimating technical inefficiency using frontier techniques. The research is based on primary survey data from a North Indian village that shares characteristics commonly observed in other groundwater-dependant agricultural areas. Estimated technical efficiency scores are highest on plots where water is sourced from a privately owned tubewell, followed by plots serviced by partnered tubewells and lowest on plots where water is bought. Income gains from improved efficiency follow the reverse patterns with the largest gains of Rupees (Rs) 1082 per bigha1 estimated for buyers’ plots and Rs. 649 per bigha for plots with their own tubewell with the average of Rs. 867 for all plots. A policy package of improved power, joint ownership of tubewells, farmer training and better water transportation systems are prescribed as policy measures to alleviate the differences amongst water users.
Topic:
Natural Resources, Water, Inequality, and Income
Political Geography:
India and North Africa

534. Combating Poverty and Social Exclusion in France

Author:
Stephanie Jamet
Publication Date:
08-2007
Content Type:
Working Paper
Institution:
The Organisation for Economic Co-operation and Development
Abstract:
Reducing poverty and social exclusion is an important objective for all French governments. Even though conventionally measured poverty is in fact lower than in most other countries, it is still higher than can be easily accepted. The current policy approach involves a large number of measures tailored to different circumstances. Some policies have unwanted side effects on labour market performance, and their cost-effectiveness could be improved to obtain better outcomes with the same resources. Concentrations of poverty and social exclusion in certain geographic areas and among certain groups of the population provide one of the most difficult challenges, for which contributions from education, labour market, housing, urban planning and anti-discrimination policies, as well as from the social services, are necessary.
Topic:
Poverty, Social Stratification, Inequality, and Social Roles
Political Geography:
Europe, France, and Western Europe

535. Natural Gas and Inequality in Bolivia after Nationalization

Author:
Lykke E. Andersen, Johann Caro, Robert Faris, and Mauricio Medinaceli
Publication Date:
08-2006
Content Type:
Working Paper
Institution:
Institute for Advanced Development Studies (INESAD)
Abstract:
The high oil prices and the sharp increases in royalties mean that the natural gas boom in Bolivia has become very important for the economy. This paper uses a Computable General Equilibrium (CGE) model to assess the impacts of this boom on key macroeconomic variables as well as the distribution of incomes in the society. From a macroeconomic perspective, the natural gas boom is a blessing, adding around 1 percentage point to GDP growth rates for at least a decade, and sharply increasing government revenues available for public spending and investment. However, the poorest segments of the population (rural small-holders and urban informals) suffer actual reductions in their real incomes, compared to the counterfactual scenario without the gas boom. This means that the natural gas boom not only causes an increase in inequality but also an increase in poverty. The paper finishes with some policy recommendations on how to counteract the negative side effects of the natural gas boom.
Topic:
Gas, Inequality, Macroeconomics, and Nationalization
Political Geography:
South America and Bolivia

536. Inequality and Suicide Rates: A Cross-Country Study

Author:
Antonio Rodríguez Andrés
Publication Date:
10-2006
Content Type:
Working Paper
Institution:
Institute for Advanced Development Studies (INESAD)
Abstract:
This paper tests whether economic inequality is related to suicide mortality. Using an unbalanced panel of 40 countries for the period 1947-2001 allows us to control for the effect of unobserved factors that may have an impact on suicide rates. Our results indicate that there is a statistically insignificant positive effect of inequality on the incidence of suicide. The latter result seems to be robust to a number of specification issues explored in a sensitivity analysis. Our results also suggest that female labour participation has a significant positive effect on the total (males and female) suicide rates, supporting the sociological argument that the role conflict dominates more than the role expansion. Contrary to the total and male suicide rates findings, the fertility rate matters in explaining female suicide rates. Finally, in contrast to previous studies, suicide rates were not sensitive to income levels, divorce rates and alcohol consumption.
Topic:
Economics, Inequality, Public Health, Data, and Suicide
Political Geography:
Global Focus

537. How Best to Use the Extraordinary Natural Gas Revenues in Bolivia? Results from a Computable General Equilibrium Model

Author:
Lykke E. Andersen
Publication Date:
12-2006
Content Type:
Working Paper
Institution:
Institute for Advanced Development Studies (INESAD)
Abstract:
The high oil prices and the sharp increases in royalties mean that the natural gas boom in Bolivia has become very important for the economy, and particularly important as a source of government revenues. Using a CGE model, Andersen et al (2006) show that the natural gas boom is likely to boost GDP growth by about 1 percentage point per year. However, if the government continues with past spending and investment patterns, the boom is also likely to have a very adverse effect on the income distribution, so much so that the poorest half of the population is likely to experience absolute reductions in their real income levels compared to a scenario without gas boom. The present paper explores alternative uses of natural gas revenues in the CGE model to see if a better outcome can be engineered.
Topic:
Economics, Gas, Inequality, and Revenue Management
Political Geography:
South America and Bolivia

538. A Half-Century of Development

Author:
Richard N. Cooper
Publication Date:
03-2005
Content Type:
Working Paper
Institution:
The John F. Kennedy School of Government at Harvard University
Abstract:
Development as a global policy objective dates from the 1940s. Relative to expectations then, the world economy performed outstandingly well during the second half of the 20th century. Worldwide growth in average per capita income exceeded two percent a year (historically unprecedented), many poor countries became rich, infant mortality declined, diets improved, longevity increased, diseases were contained if not vanquished. Poverty on the World Bank definition of $1 a day (in 1985$) declined dramatically, and the number of persons in poverty was halved despite a more than doubling of the world population. Variations occurred over time and space, with rapid growth being concentrated in Europe and Japan early in the period, then moving to east Asia, southeast Asia, and south Asia. Growth in the 1950s and especially the 1960s exceeded that in later decades. Examples of high growth could be found in every continent, but on average sub-Saharan Africa fared much less well than other regions. Declines in national per capita income were rare, and concentrated in Africa. Civil disorder was a common but not the universal cause of low growth. Median world income gained relative to the well-off, but both spurted ahead of the poorest. World exports grew more rapidly than output, often leading the way. Many countries gradually shifted their exports from primary products to labor-intensive manufactured goods, and as development proceeded to more sophisticated manufactures and services. The fraction of the labor force devoted to agriculture declined significantly. One country after another achieved social stability, created the right incentives for effort and risk-taking, and engaged constructively with the world economy, which facilitated economic growth. Those that lagged failed to meet one or more of these conditions. Civil and political liberties also spread during this period, although less certainly and less securely. On the whole, it was a good half century for mankind. The substantial poverty and misery that still exists should not lead to neglect or even denial of these achievements.
Topic:
Development, Inequality, Economy, and Economic Growth
Political Geography:
Africa, Japan, Europe, and Asia

539. Why is Mobility in India so Low? Social Insurance, Inequality, and Growth

Author:
Kaivan Munshi and Mark Rosenzweig
Publication Date:
07-2005
Content Type:
Working Paper
Institution:
The John F. Kennedy School of Government at Harvard University
Abstract:
This paper examines the hypothesis that the persistence of low spatial and marital mobility in rural India, despite increased growth rates and rising inequality in recent years, is due to the existence of sub-caste networks that provide mutual insurance to their members. Unique panel data providing information on caste loans and sub-caste identification are used to show that households that out-marry or migrate lose the services of these networks, which dampens mobility when alternative sources of insurance or finance of comparable quality are unavailable. At the aggregate level, the networks appear to have coped successfully with the rising inequality within sub-castes that accompanied the Green Revolution. Indeed, this increase in inequality lowered overall mobility, which was low to begin with, even further. The results suggest that caste networks will continue to smooth consumption in rural India for the foreseeable future, as they have for centuries.
Topic:
Economics, Inequality, Economic Growth, Mobility, and Insurance
Political Geography:
South Asia and India

540. The Istanbul Symposium: Empowering Women in Public Life and Democratic Development in the BMENA Region

Author:
Turkish Economic and Social Studies Foundation (TESEV)
Publication Date:
11-2005
Content Type:
Special Report
Institution:
Turkish Economic and Social Studies Foundation (TESEV)
Abstract:
"One of the issues the Democracy Assistance Dialogue will concentrate on is the empowerment of women in public life. As agreed on in Rome Ministerial meeting of DAD on 25 November 2004 "Democratic development requires inclusion of women as an active and essential component of society. To stimulate active participation of women in democratic practices is also a fundamental priority. The Dialogue shall support efforts aimed at promoting women's participation in political life and active contribution to democratic projects and programs. Indeed, a substantial gender gap exists in the BMENA region. Like in many other countries, women are the most disadvantaged segment of society simply because they are women. Gender inequality in the region is compounded by high levels of illiteracy among women, In many countries women still cannot enjoy their political rights sufficiently and their chances of social and political participation are completely blocked. Gender related discrimination is a major impediment to democratic reform in the region. If women constitute half of their respective societies, then, along with men, they should partake in decision-making pertaining to their common future.
Topic:
Gender Issues, Women, Democracy, Inequality, and Discrimination
Political Geography:
Turkey and Middle East