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From the Editor's Desk (January 2012)Tony Addison January saw the snow arrive in Helsinki. As I look out across the harbour, the scene is one of various shades of white and grey. The...
Tony Addison January saw the snow arrive in Helsinki. As I look out across the harbour, the scene is one of various shades of white and grey. The...
We explore a novel first-order dominance (FOD) approach to poverty mapping and compare its properties to small-area estimation. The FOD approach uses census data directly, is straightforward to implement, is multidimensional allowing for a broad...
The Millennium Development Goals (MDGs) give aid to Africa a new emphasis. Yet aid flows to Africa have trended downward over the last decade, and as a consequence more Africans now live in poverty. This is especially true of Sub-Saharan Africa. Any...
Aid is said to be fungible at the aggregate level if it raises government expenditures by less than the total amount. This happens when the recipient government decreases domestic revenue, decreases net borrowing, or when aid bypasses the budget...
Growth, poverty reduction, and social peace are all undermined when public expenditure management and taxation are weak and when the fiscal deficit and public debt are not managed successfully. And large-scale aid and debt relief cannot work without...
There has been significant amount of aid inflows to developing countries including Ghana, but these have been very volatile. Aid flows have been associated with low domestic resource mobilization and have reduced Ghana to a country heavily dependent...
This paper is a contribution to the literature on aid and growth. Despite an extensive empirical literature in this area, existing studies have not addressed directly the mechanisms via which aid should affect growth. We identify investment as the...
An important feature of aid to developing countries is that it is given to the government. As a result, aid should be expected to affect fiscal behaviour, although theory and existing evidence is ambiguous regarding the nature of these effects. This...
The proposals in this paper derive from studies undertaken at WIDER on questions relating to sustainable development in developing countries. The paper attempts to quantify the resource transfer implications of supporting feasible environment...
This paper attempts to provide a comprehensive analysis of interrelationships among the determinants of the quality of life (QOL). We show that various measures of well-being are highly sensitive to domains of QOL that are considered in the...
This paper reviews income distribution in developing (and transition) countries in recent decades. On average, before-tax income distribution is less unequal in developing countries than it is in industrial countries. However, unlike industrial...
Part of Journal Special Issue Aid for Gender Equality and Development
The analysis of the optimal funding of education is complicated by the numerous and serious market failures which are likely to characterize a free market for education. Prominent amongst these are the likely external benefits of education, stressed...
This paper is the fruit of an attempt to distinguish the elements, present in a fiscal decentralization process, that are likely to contribute to efficiency enhancement in the provision of social services in developing countries. From the...
This study investigates the impacts of public expenditure innovations on exchange rate volatility in South Africa using quarterly data for the period 1970–2019. To achieve this objective, a version of the vector autoregressive impulse response model...
Notwithstanding the unprecedented attention devoted to reducing poverty and fostering human development via scaling up social sector spending, there is surprisingly little rigorous empirical work on the question of whether social spending is...
I recently returned from a week at the University of Western Cape (UWC) in South Africa, speaking at a conference honouring Nobel laureate Desmond...
Malawi’s farm input subsidy benefits the poor and can be part of a viable national development strategy. Agriculture is Malawi’s main economic sector...
While developing countries have made some progress in achieving human development since the turn of the century, many are still lagging behind in important human development goals such as education, health, nutrition and access to clean drinking...
A dynamic relationship between foreign aid and domestic fiscal variables in Uganda is analysed using a cointegrated vector autoregressive model over the period 1972-2008. Results show that aid is a significant element of long-run fiscal equilibrium...
Agricultural development is facing great challenges in meeting global food security and is expected to face even greater difficulties under climate change. The overall goal of this paper is to examine how foreign aid in particular can be used to...
This paper examines the effect of education aid on primary enrollment and education quality. Using the most recent data on aid disbursements and econometric specifications inspired by the general aid effectiveness literature, we find some evidence...
Budget reliability is the first pillar of Public Expenditure and Financial Accountability (PEFA). In this study, we construct an expansion of the PEFA government response accuracy indicator and test its decomposition, with an application to the...
The expected increase in aid to Africa will put a big challenge for public service delivery. Using a simultaneous equation model, this paper provides an analysis of the effects of the volume and volatility of aid on education, health, water and...
Recent studies suggest that the allocation of expenditures in education is important for growth. The state of public education spending in many transition economies highlights the need for an assessment of the nature of education expenditures in...
One key element in the reduction of poverty and (in Latin America) inequality has been the achievement of greater fiscal equity; we analyse one key part of this process, which is the earmarking of portions of tax revenue to be spent on progressive...
During recent years, provision of key social services in low-income countries has been affected by adverse macroeconomic conditions and by radical changes in economic thinking. For example, the welfarist approach, which gives prominence to the state...
Peace can generate an economic dividend, which can be further increased by appropriate economic reform. This dividend can in turn be used to raise popular support for conflict resolution measures along the road to achieving a final political...
The long-running conflict in northern Uganda has led to major violations of human rights against civilians, destruction of infrastructure, reduced access to social services, and paralysed economic activity. Creating peace and fostering reconciliation...
This paper examines the causes of conflict in Burundi and discusses strategies for building peace. The analysis of the complex relationships between distribution and group dynamics reveals that these relationships are reciprocal, implying that...
This paper studies the postwar economic and political reconstruction in Lebanon. The paper shows that the ‘reconstruction boom’ was short-lived. The economy experienced a growth trap early in the reconstruction period, and entered a cyclical crisis...
The impact of aid inflows on relative prices and output is ambiguous. Aid inflows that increase domestic expenditure are likely to cause real exchange rate appreciation, ceteris paribus. However, if this expenditure raises the capital stock in the...
This paper examines the efficiency of public sector expenditures at achieving social sector outcomes in small island developing states (SIDS). Public sector efficiency is estimated using a stochastic production function (SPF) approach and panel data...
The paper discusses implications for practice and theory of the recently completed Joint Evaluation of General Budget Support 2004-06 based on case studies in Burkina Faso, Malawi, Mozambique, Nicaragua, Rwanda, Uganda and Vietnam. The paper first...
The paper explores the impact of a binding external debt-servicing constraint on the sectoral composition of government expenditures in the economies of Africa, where this constraint has traditionally been most prevalent. Applying seemingly unrelated...
This paper introduces a discrete-time intertemporal investment model in which the flow of profits affects the risk premium on the cost of finance, and, as a consequence, the rate of discount of future profits. While public investments, according to a...
In evaluating tax reform in the developing countries, one first needs to determine what is the unique role of the tax system in each particular country. One of the key reasons for undertaking tax reforms in Kenya was to address issues of inequality...
Ghana’s tax reforms constitute the major policy instrument needed to accelerate growth and poverty reduction. Over the past two decades, the government has consistently spent more revenue than it is able to generate and the gap is often financed with...
Recent studies suggest that the allocation of expenditures in education matters for growth. Public education spending in many transition economies, however, is often inefficient and inequitable with education outlays misallocated across sectors. This...
Part of Book Understanding Small-Island Developing States
Part of Book Inequality, Growth and Poverty in an Era of Liberalization and Globalization
Part of Book Fiscal Policy for Development
Part of Book Fiscal Policy for Development
Part of Book Fiscal Policy for Development
Part of Book Fiscal Policy for Development
Fiscal policy is critical to the development of poor countries. Public spending on pro-poor services and public goods must be increased, tax revenues must be mobilized, and macro-economic stabilization must be achieved without inhibiting growth...
This paper assesses recent theorising and empirical evidence on the impact of fiscal policy—taxes, public expenditures and budget deficits—on long-run growth. It considers the relevance of recent advances in growth theory for low-income countries and...
The post-independence Mozambican civil service, what was left of it following the exodus of Portuguese settlers in the mid-1970s, was poorly educated, with low incentives. In subsequent years, the combination of a war-ravaged economy, poor human...
Part of Journal Special Issue Fragility and Development in Small Island Developing States
Part of Book Foreign Aid for Development
Part of Book Food Price Policy in an Era of Market Instability
It is clear from the implications of growth theory that the impact of aid depends on how it affects savings, investment and government behaviour. In respect of low-income countries, which are the principal aid recipients and the economies for which...
The ethnic conflicts in Burundi and Rwanda have severely weakened the economies and worsened the structural fiscal imbalances of these countries. Government revenue has declined due to the erosion of the tax base and tax administration capacity. At...
Little is known about the extent to which public spending is targeted towards the poor in Mozambique. The objective of the present paper is to assess whether public expenditures on education and health, in particular, are successful at reaching the...
This paper considers some aspects of the effects of fiscal policy on macroeconomic adjustment in developing countries. First, the paper reviews the notion of the fiscal deficit in the particular context of developing countries. It then spells out the...
The study is an empirical test of the effects of different categories of government expenditure, revenue and deficits on economic growth in developing countries. It is based on panel data of annual series over the last three decades for 103 countries...
This paper discusses the experience with opening up to the global economy of two small Central American countries, Honduras and Nicaragua. They have both strengthened democratic processes and reduced defence expenditure dramatically. Both have...
This paper analyses the impact of fiscal policy on private investment for a sample of thirty-three LDCs. The paper makes a number of important contributions to the existing empirical literature. Its main contribution is that it is the first attempt...
Contemporary civil wars are rooted in a partial or complete breakdown of the social contract, often involving disputes over public spending, resource revenues, and taxation. A feasible social contract gives potential rebels something akin to a...
Political violence, coup d’état, civil wars and inter-state wars, all have fiscal dimensions (and sometimes fiscal causes). Who gets what—public employment and public spending—and who has to pay for it, are questions that raise fundamental issues...
This study evaluates the impact of the over seventy Social Funds (SFs) which were introduced since the mid-1980s to offset the surge in poverty spurred by adjustment. SFs benefited from greater visibility and financial support by the donor community...