Protecting the environment and the poor - a public goods framework applied to Indonesia

As is evident from public finance principles, redistribution objectives do not influence environmental policies if there are other, costless means of redistribution. How does optimal environmental protection depend on redistribution objectives? The authors develop a framework that treats air quality as a pure public good, and tracks net beneficiaries as those who value air quality improvements more than their costs in a pollution control strategy. The framework highlights the distributional characteristics of the public good and of the costs for the control strategy. One critical parameter for the distributional characteristics of the public good is the elasticity (with respect to income) of willingness to pay for environmental improvements. Strategies to control urban air pollution would be altered by redistribution objectives -- to be more aggressive in reducing emission from luxury goods such as transport (private and general) and less aggressive for goods more heavily consumed by the poor (including several energy sources). Some air pollution control strategies cover urban and rural areas, For those, optimal pollution control would typically be reduced by redistribution objectives, as rural households are net losers, and they are poorer.Pollution Management&Control,Economic Theory&Research,Public Health Promotion,Environmental Economics&Policies,Water and Industry,Pollution Management&Control,Energy and Environment,Environmental Economics&Policies,Economic Theory&Research,Water and Industry

Social risk management : a new conceptual framework for social protection and beyond

This paper proposes a new definition, and conceptual framework for social protection, grounded in social risk management. The concept repositions the traditional areas of social protection (labor market intervention, social insurance, and social safety nets) in a framework that includes three strategies to deal with risk (prevention, mitigation, and coping), three levels of formality of risk management (informal, market-based, public), and, many actors (individuals, households, communities, non-governmental organizations, governments at various levels, and international organizations) against the background of asymmetric information, and different types of risk. This expanded view of social protection emphasizes the double role of risk management instruments - protecting basic livelihood, as well aspromoting risk taking. It focuses specifically on the poor, since they are the most vulnerable to risk, and typically lack appropriate risk management instruments, which constrains them from engaging in riskier, but also higher return activities, and hence gradually moving out of chronic poverty.Environmental Economics&Policies,Health Economics&Finance,Insurance&Risk Mitigation,Social Risk Management,Banks&Banking Reform

Installment 2 of "Creating a Sustainable Food Future": Reducing Food Loss and Waste

Approximately one out of every four calories grown to feed people is not ultimately consumed by humans. Food is lost and wasted to a varying extent across the globe, across all stages of the food value chain, and across all types of food. As a result, overall global food availability is lower than it would be otherwise, negatively affecting food security and requiring the planet's agriculture system to produce additional food to compensate for the food that is not ultimately consumed by people. The potential benefits of reducing food loss and waste are large. As a strategy for closing the food gap between food available today and food needed in 2050 to adequately feed the planet's projected 9.3 billion people, reducing food loss and waste satisfies each of the development and environmental criteria we introduced in the first installment of the Creating a Sustainable Food Future series. While increasing food availability, reducing food loss and waste can alleviate poverty and provide gender benefits while reducing pressure on ecosystems, climate, and water. Reducing food loss and waste may be one of those rare multiple "win-win" strategies.How can the world go about reducing food loss and waste on a large scale? This installment of the forthcoming "World Resources Report Creating a Sustainable Food Future" addresses that question. This working paper, which will feed into that report, begins by clarifying definitions of food loss and waste, then quantifies the scale of the problem and explores the impact addressing the problem could have on the food gap. The paper then focuses on practical solutions for reducing food loss and waste and presents case studies of successful initiatives. It concludes by offering recommendations for how to scale up reductions in food loss and waste

Evaluating targeted cash transfer programs: a general equilibrium framework with an application to Mexico

This report focuses on the indirect and direct effects of transfer programs. In particular, it shows how modelling results can be combined with information from standard household surveys to provide an integrated analysis of the direct distributional impact of such programs and the indirect distributional and efficiency impacts arising from domestic financing mechanisms. This approach reflects the view that any credible poverty alleviation strategy must have a credible financing strategy underlying it, and this need for domestic financing can have important consequences for both the level and the distribution of household incomes. To illustrate the approach, the report focuses on the recent introduction in Mexico of an innovative poverty alleviation transfer program called PROGRESA, which has been used as a prototype for similar programs that have recently been implemented in other developing countries.Economic assistance, Domestic Mexico Evaluation, Public welfare - Mexico Evaluation,

Poverty in India: Misspecified Policies and Estimates

Growth, Redistribution, Poverty, Specification error

Tax Policy and Employment: How Does the Swedish System Fare?

This paper reviews the literature on optimal taxation of labour income and the empirical work on labour supply and the elasticity of taxable income in Sweden. It also presents an overview of Swedish taxation of labour income, offers calculations on the development in effective marginal tax rates and participation tax rates, and estimates, using the difference-in-differences method, the impact of tax incentives on employment rates of elderly workers. After this background, we ponder possibilities for reforming the Swedish tax system to improve its labour market impacts. We suggest better targeting the earned income tax credit at families and low-income workers, lowering the top marginal tax rates, and maintaining the tax incentives for older workers.optimal taxation, labour income taxation, labour supply, taxable income, Swedish tax system

Designing Strategies to Support a Transformation of Agriculture in Ethiopia

The paper consists of three parts. The first part of the paper is a review of agricultural performance in Ethiopia over the past forty years. The second part diagnoses agricultural system performance and food security problems in Ethiopia and discusses some tentative practical strategies for promoting an agricultural transformation, and with it, increased productivity, income growth, and food security over the long run. The third part describes the general approach to promoting an agricultural transformation and food security for Ethiopia. It is conceptual and procedural. It draws from the lessons of economic history and theory applied to the current situation in Ethiopia.food security, food policy, Ethiopia, Farm Management, Food Security and Poverty, Q18,

Tax Policy and Employment: How Does the Swedish System Fare?

This paper reviews the literature on optimal taxation of labour income and the empirical work on labour supply and the elasticity of taxable income in Sweden. It also presents an overview of Swedish taxation of labour income, offers calculations on the development in effective marginal tax rates and participation tax rates, and estimates, using the difference-in-differences method, the impact of tax incentives on employment rates of elderly workers. After this background, we ponder possibilities for reforming the Swedish tax system to improve its labour market impacts. We suggest better targeting the earned income tax credit at families and low-income workers, lowering the top marginal tax rates, and maintaining the tax incentives for older workers.Optimal taxation; labour income taxation; labour supply; taxable income; Swedish tax system.

CGE-Microsimulation Modelling: A Survey

This paper reviews the recent work on the application of the CGE-microsimulation models. The discussion focuses on the various linking methodologies and how they can impact our results.Computable General Equilibrium (CGE) Model; Microsimulation; Poverty; Inequality;