Comparative study of commercial building energy-efficiency retrofit policies in four pilot cities in China

The energy efficiency of existing commercial buildings is more challenging to regulate and improve than the energy efficiency of new constructions. In 2011 and 2012, the Chinese Government selected four cities- Shanghai, Tianjin, Shenzhen, and Chongqing- to implement pilot commercial building energy efficiency retrofit program. Based on site surveys and expert interviews in these pilot cities, this research conducted a comparative analysis on incentive policies of local city level. The analysis results show that policy designs of existing commercial buildings should be further improved. The aspects that influence the implementation effect in the future, such as subsidy level, installments, and business model promotion, should be specified in the policy clauses. Referring to the technical solution and cost-benefit in Chongqing, we found that lighting system is the most common retrofit objects while envelope system is the least common one. And the subsidy incentive is greatest for educational buildings, followed by office buildings. In the end, we further discussed the problems and obstacles in commercial building retrofit market, and provided a series of recommendations

Passenger Air Service in Michigan’s Upper Peninsula: Overview and Analysis

[Excerpt] Rural America needs safe, efficient, reliable, and accessible passenger air service. Federal government subsidies have long been necessary to assure that residents in smaller, less profitable markets have access to the nation’s transportation network. That access is necessary for a community’s economic health, is arguably a right of all taxpayers and residents, and is in public interest. But market forces within the aviation industry are today driving a restructuring that may curtail or eliminate service to many communities in the nation. And the present political climate raises a serious question about the federal government’s continued commitment to the nation’s rural air transportation system. This report focuses on the state of passenger air service in Michigan’s Upper Peninsula [U.P.]. The U.P. is among the most geographically remote areas in the eastern half of the United States. The region’s economic, social, and cultural institutions are increasingly related to a global marketplace. These depend, in varying degrees, on access to the national and global transportation network. Scheduled, commercial passenger air service is especially critical for this area too distant from passenger rail, without adequate commercial bus service, with few four-lane highways and very limited connection to the Interstate Highway system

Measuring the performance and achievement of social objectives of development finance institutions

This paper develops and tests a proposed methodology that puts forward a new integrated method for evaluating the performance of development finance institutions. This methodology applies assessment criteria that take into account both the social objective that the development finance institution addresses and the subsidies it received in order to achieve such an objective. This methodology is applied to two pilot case studies-Banadesa (Honduras) and Banrural (Guatemala). The authors calculate the previously tested subsidy dependence index, which measures the degree of an institution's subsidy dependence. The paper develops and estimates a new measure-the output index- which indicates the level to which the institution fulfills the social objectives of the state. The analysis integrates the subsidy dependence index and the output index to assess the effectiveness associated with meeting the social objective. The findings suggest that the integration of the two indexes can constitute the basis of a meaningful evaluation framework for the performance of development finance institutions. This new methodology can also be a useful metric for policy makers who are seeking to decide on an optimal allocation of scarce funds for development finance institutions that pursue social goals and for management that seeks improved performance outcomes.,Access to Finance,Debt Markets,Banks&Banking Reform,Economic Theory&Research

Solid Footing: Reinforcing the Early Care and Education Economy for Infants and Toddlers in DC

The District of Columbia (DC) is a vibrant, diverse, financially stable city that has become one of the most expensive places to live in the nation. It also ranks among the five major U.S. cities with the greatest income inequality. Because of this economic divide, the District struggles to create equity among its population, particularly in education where the achievement gap between poor and wealthy stubbornly persists. Research has consistently shown that this achievement gap begins not in kindergarten, but in the cradle, with the differences between the early learning environments of children who live in low-income and upper-income households producing cognitive differences before a child even reaches the public school system. Access to high-quality early learning environments can reduce or even eliminate that gap, which is why District policymakers have invested heavily in quality universal preschool and Pre-Kindergarten. But children from low-income households can already be cognitively behind by preschool, so the District must also invest in the early education needs of its infants and toddlers.This report attempts to quantify and qualify what investment need to be made. Until now, no one has assessed how much it costs early care and education (ECE) providers to meet the level of quality that the District requires, or how providers are able to maintain quality while serving families who depend on child care subsidy payments from the government. DC Appleseed and the DC Fiscal Policy Institute have collaborated to produce a study to better understand these realities. The work grew from concern that the District's payment rates to ECE providers for the child care subsidy program are not keeping up with the costs, even though the children receiving subsidized services and the nearly 200 providers who serve them are among the District's most vulnerable and precious resources. The underpaid workforce that cares for and educates infants and toddlers is essentially subsidizing the system through low wages

Accountability for Economic Development Incentives in Georgia

This report identifies Georgia's major economic development incentives and other forms of public finance support and calls for a comprehensive evaluation of public expenditures in this area. FRC Report 10

Experimentation in securities market structure and regulation in China: from state to market

A key feature of the socialist market economy in China is the development of securities markets so as to facilitate entrepreneurship. With the national securities market now well established attention has shifted to the development of lower tier markets that may be able to meet the financing needs of smaller scale enterprises. In this article we examine how the concept of experimentation has been applied to the process of developing such markets and the regulatory framework in which they operate. We begin with a survey and critique of the policy and regulatory framework within which lower-tier markets have evolved. We argue that experimentation has been important in China but that it operates in a unique way as a result of the institutional structure in which securities markets are located. We then focus more specifically on the regulatory framework for lower tier markets and present two case studies focused on the establishment and operation of two local equity exchanges in a single province (LiaoNing). While this evidence supports our view on the significance of experimentation it also highlights the problems associated with developing lower-tier securities markets within the current policy framework

Health Insurance Exchanges: Key Issues for State Implementation

Explores considerations for state governments in planning infrastructure and policies for exchanges for individuals and small businesses, including interactions with state Medicaid and Children's Health Insurance Programs. Lists options and pros and cons

Policy Areas Impinging on Elderly Transportation Mobility: An Explanation with Ontario, Canada as Example

As countries face the challenges posed by rising numbers of older persons, the need to reassess their respective policies to address transport needs in aging societies is increasingly recognized in relation to health and sustainability goals. This paper proposes the examination of six interrelated policy areas affecting elderly mobility in a country or administrative region. A general survey of policy developments in each of these areas could improve current strategies and existing processes in the planning and implementation of mobility services that will be responsive to both elderly and the general population now and in the future. These include: 1) general transport policy framework; 2) travel mode preference; 3) alternative transport infrastructure stock and investments; 4) housing-land-use-transportation linkage; 5) research and technology applications that improve travel mode and environment; and 6) institutional and legal reforms. These policy areas are discussed and given concrete elucidation in the case of Ontario, Canada. Reflections and recommendations for further research and policy action deemed critical in the case region are highlighted.transportation, aging, regional policy, Canada

Systemically Important or “Too Big to Fail” Financial Institutions

Although “too big to fail” (TBTF) has been a perennial policy issue, it was highlighted by the near-collapse of several large financial firms in 2008. Large financial firms that failed or required extraordinary government assistance in the recent crisis included depositories (Citigroup and Washington Mutual), government-sponsored enterprises (Fannie Mae and Freddie Mac), insurance companies (AIG), and investment banks (Bear Stearns and Lehman Brothers).1 In many of these cases, policy makers justified the use of government resources on the grounds that the firms were “systemically important” or “too big to fail.” TBTF is the concept that a firm’s disorderly failure would cause widespread disruptions in financial markets that could not easily be contained. While the government had no explicit policy to rescue TBTF firms, several were rescued on those grounds once the crisis struck. TBTF subsequently became one of the systemic risk issues that policy makers grappled with in the wake of the recent crisis. This report discusses the economic issues raised by TBTF, broad policy options, and policy changes made by the relevant Dodd-Frank provisions. This report also discusses recent legislation addressing the TBTF issue in the 113th Congress. The report ends with an Appendix reviewing the historical experience with TBTF before and during the recent crisis

Pension Reforms in India: Myth, Reality and Policy Choices

Escalating costs of the pension system is forcing the Indian Government to reevaluate the formal programmes that provide social security to employees. The government has so far received three official reports (namely, OASIS, IRDA and Bhattacharya), which have examined the issue and suggested several measures to provide a safety net to the aging population. This paper examines the recommendations made in these reports and analyses the potential effects of them. It is organized around five policy questions: 1. Should the reformed system create individual (funded defined-contribution) accounts, or should it remain a single collective fund with a defined-benefit formula? The changeover involves a larger public policy choice issue: who should ultimately bear the risk? Should employees/retirees shoulder those risks alone arising from variations in asset yields and unexpected changes in longevity, or should these risks be shared more broadly across participants, if not society? Choice would depend upon to which group the individual belongs. Financially successful people may believe in individual ownership and choice, while low wage earners may want assured returns because they do not have other resources to fall back upon. Unfortunately most Indians, unlike those in many other countries, are in the latter category which cannot bear any risk, more so in the old age. 2. If individual accounts are adopted, should the reformed system move toward private and decentralized collection of contributions, management of investments, and payment of annuities, or should these functions be administered by a public agency? In privately managed funds, associated problems would be intermediation costs, agency problem (principal-agent fiduciary relationship), and greatly increased costs to administer the plan. Several studies across the world have shown that periodic fee may look deceptively low but, over longer time horizons, the cumulative effect can be dramatic, sometimes reducing the benefits by 30 to 50 per cent. 3. Should fund managers of retirement savings be allowed to invest in a diversified portfolio that includes stocks and private bonds? In recent years equity investments, particularly index investing, have become a favoured strategy. Index funds are subject to tracking error, and being loaded with few big stocks, there are much higher risks in index investing than people perceive. Over the period, real annual return on index funds may be more, but people retire only once. Equity markets are highly volatile and go through long periods of feasts and famine. Guarantees would have to be provided in the form of minimum return or providing minimum basic pension on retirement. World bank studies show that government ends up acquiring conjectural liabilities wherever a pension system based on private providers is mandated. How would that be different from the present system where a government agency (EPFO) provides retirement benefits? 4. Should the government move toward advance funding of its pension obligations for its employees, or should these obligations continue to be financed on pay-as-you-go basis? Studies have shown that a simultaneous implementation of funded, diversified, individual accounts is not a "free lunch" once you properly account for existing unfounded obligations and risk. The Bhattacharya Committees estimates show that the government would have to pay out more on account of pensions to its employees for the next 38 years before the new scheme starts showing reduced government expenditure. These amounts do not include the tax foregone by the government on the employees contribution. Several assumptions have been made about the scheme, which the committee hopes would remain valid and that the future governments would behave responsibly. The proposed scheme does not consider intermediation costs and agency risks; in fact, the committee presumes that agents would behave more responsibly than principals. 5. What should be the level of government fiscal support in the form of tax subsidy, foregone tax collections, grants, administrative costs incurred by its agencies, and level of assumed contingent liabilities in case the government guarantees minimum pension? The crucial question is: how much and to whom is this subsidy accruing? Are beneficiaries of the proposed system the ones who need subsidy? Tax treatment of pension is a critical policy choice. A generous tax treatment may promote savings but may be costly in terms of revenue foregone. Apparently, an exercise in balancing is necessary. The priority should, therefore, be putting in place a policy vision and road map with specific goals in relation to pre-determined milestones. These should include a tax financed and means-tested system for lower income groups. If government cannot afford it, then it has no moral or political justification to even consider providing further tax benefits to privileged income groups. If there are no government funds for the first pillar in the World Bank recommended multipillar system, the third pillar should remain out of policy discussions. Emphasis should be on strengthening the second pillar. Suggested reforms neither enhance efficiency nor make the social security system more equitable. It would only privatize the gains while costs and risk for the government would increase considerably. It would only help well-off segment of society in availing more tax concessions. Present problem in the government pension system is due to successive governments behaving like Santa Clauses ignoring the cost to exchequer. Fund managers would not be able to solve these problems. Specific fiscal and other measures for implementing a feasible and viable pension system in Indian conditions have also been suggested in the paper.