Tax policy to reduce carbon emissions in south Africa

Noting that South Africa may be one of the few African countries that could contribute to mitigating climate change, the authors explore the impact of a carbon tax relative to alternative energy taxes on economic welfare. Using a disaggregate general-equilibrium model of the South African economy, they capture the structural characteristics of the energy sector, linking a supply mix that is heavily skewed toward coal to energy use by different sectors and hence their carbon content. The authors consider a"pure"carbon tax as well as various proxy taxes such as those on energy or energy-intensive sectors like transport and basic metals, all of which achieve the same level of carbon reduction. In general, the more targeted the tax to carbon emissions, the better the welfare results. If a carbon tax is feasible, it will have the least marginal cost of abatement by a substantial amount when compared to alternative tax instruments. If a carbon tax is not feasible, a sales tax on energy inputs is the next best option. Moreover, labor market distortions such as labor market segmentation or unemployment will likely dominate the welfare and equity implications of a carbon tax for South Africa. This being the case, if South Africa were able to remove some of the distortions in the labor market, the cost of carbon taxation would be negligible. In short, the discussion of carbon taxation in South Africa can focus on considerations other than the economic welfare costs, which are likely to be quite low.Environmental Economics&Policies,Transport Economics Policy&Planning,Taxation&Subsidies,Energy Production and Transportation,Environment and Energy Efficiency

An Analysis of South Africa's Value Added Tax

In this paper, the authors describe South Africa's value added tax (VAT), showing that (1) the VAT is mildly regressive, and (2) it is an effective source of government revenue, compared with other tax instruments in South Africa. They evaluate the VAT in the context of other distortions in the economy by computing the marginal cost of funds-the effect of raising government revenue by increasing the VAT rates on household welfare. Then they evaluate alternative, revenue-neutral tax systems in which they reduce the VAT and raise income taxes. For the analysis, the authors use a computable general equilibrium (CGE) model with detailed specification of South Africa's tax system. Households are disaggregated into income deciles. They demonstrate that alternative tax structures can benefit low-income households without placing excess burdens on high-income households.

Wage subsidy and labor market flexibility in south Africa

In this paper, the authors use a highly disaggregate general equilibrium model to analyze the feasibility of a wage subsidy to unskilled workers in South Africa, isolating and estimating its potential employment effects and fiscal cost. They capture the structural characteristics of the labor market with several labor categories and substitution possibilities, linking the economy-wide results on relative prices, wages, and employment to a micro-simulation model with occupational choice probabilities in order to investigate the poverty and distributional consequences of the policy. The impact of a wage subsidy on employment, poverty, and inequality in South Africa depends greatly on the elasticities of substitution of factors of production, being very minimal if unskilled and skilled labor are complements in production. The desired results are attainable only if there is sufficient flexibility in the labor market. Although the impact in a low case scenario can be improved by supporting policies that relax the skill constraint and increase the production capacity of the economy especially towards labor-intensive sectors, the gains from a wage subsidy are still modest if the labor market remains very rigid.Labor Markets,Labor Policies,,Economic Theory&Research,Access to Finance

Aid, growth, and real exchange rate dynamics

Devarajan, Go, Page, Robinson, and Thierfelder argued that if aid is about the future and recipients are able to plan consumption and investment decisions optimally over time, then the potential problem of an aid-induced appreciation of the real exchange rate (Dutch disease) does not occur. In their paper,"Aid, Growth and Real Exchange Rate Dynamics,"this key result is derived without requiring extreme assumptions or additional productivity story. The economic framework is a standard neoclassical growth model, based on the familiar Salter-Swan characterization of an open economy, with full dynamic savings and investment decisions. It does require that the model is fully dynamic in both savings and investment decisions. An important assumption is that aid should be predictable for intertemporal smoothing to take place. If aid volatility forces recipients to be constrained and myopic, Dutch disease problems become an issue.Economic Theory&Research,Debt Markets,Currencies and Exchange Rates,Emerging Markets,

Wage Subsidy and Labour Market Flexibility in South Africa Delfin S. Go, Marna Kearney, Vijdan Korman, Sherman Robinson and Karen Thierfelder

In this paper, we use a highly disaggregate general equilibrium model to analyse the feasibility of a wage subsidy to unskilled workers in South Africa, isolating and estimating its potential employment effects and fiscal cost. We capture the structural characteristics of the labour market with several labour categories and substitution possibilities, linking the economy-wide results on relative prices, wages, and employment to a micro-simulation model with occupational choice probabilities in order to investigate the poverty and distributional consequences of the policy. The impact of a wage subsidy on employment, poverty, and inequality in South Africa depends greatly on the elasticities of substitution of factors of production, being very minimal if unskilled and skilled labour are complements in production. The desired results are attainable only if there is sufficient flexibility in the labour market. Although the impact in a low case scenario can be improved by supporting policies that relax the skill constraint and increase the production capacity of the economy especially towards labour-intensive sectors, the gains from a wage subsidy are still modest if the labor market remains very rigid.

Economy-wide and distributional impacts of an oil price shock on the south African economy

As crude oil prices reach new highs, there is renewed concern about how external shocks will affect growth and poverty in developing countries. This paper describes a macro-micro framework for examining the structural and distributional consequences of a significant external shock-an increase in the world price of oil-on the South African economy. The authors merge results from a highly disaggregative computable general equilibrium model and a micro-simulation analysis of earnings and occupational choice based on socio-demographic characteristics of the household. The model provides changes in employment, wages, and prices that are used in the micro-simulation. The analysis finds that a 125 percent increase in the price of crude oil and refined petroleum reduces employment and GDP by approximately 2 percent, and reduces household consumption by approximately 7 percent. The oil price shock tends to increase the disparity between rich and poor. The adverse impact of the oil price shock is felt by the poorer segment of the formal labor market in the form of declining wages and increased unemployment. Unemployment hits mostly low and medium-skilled workers in the services sector. High-skilled households, on average, gain from the oil price shock. Their income rises and their spending basket is less skewed toward food and other goods that are most affected by changes in oil prices.Economic Theory&Research,,Labor Policies,Markets and Market Access,Access to Finance

Chronic Kidney Disease and Cognitive Function in Older Adults: Findings from the Chronic Renal Insufficiency Cohort Cognitive Study

To investigate cognitive impairment in older, ethnically diverse individuals with a broad range of kidney function, to evaluate a spectrum of cognitive domains, and to determine whether the relationship between chronic kidney disease (CKD) and cognitive function is independent of demographic and clinical factors.Cross-sectional.Chronic Renal Insufficiency Cohort Study.Eight hundred twenty-five adults aged 55 and older with CKD.Estimated glomerular filtration rate (eGFR, mL/min per 1.73 m 2 ) was estimated using the four-variable Modification of Diet in Renal Disease equation. Cognitive scores on six cognitive tests were compared across eGFR strata using linear regression; multivariable logistic regression was used to examine level of CKD and clinically significant cognitive impairment (score ≤1 standard deviations from the mean).Mean age of the participants was 64.9, 50.4% were male, and 44.5% were black. After multivariable adjustment, participants with lower eGFR had lower cognitive scores on most cognitive domains ( P <.05). In addition, participants with advanced CKD (eGFR<30) were more likely to have clinically significant cognitive impairment on global cognition (adjusted odds ratio (AOR) 2.0, 95% CI=1.1–3.9), naming (AOR=1.9, 95% CI=1.0–3.3), attention (AOR=2.4, 95% CI=1.3–4.5), executive function (AOR=2.5, 95% CI=1.9–4.4), and delayed memory (AOR=1.5, 95% CI=0.9–2.6) but not on category fluency (AOR=1.1, 95% CI=0.6–2.0) than those with mild to moderate CKD (eGFR 45–59).In older adults with CKD, lower level of kidney function was associated with lower cognitive function on most domains. These results suggest that older patients with advanced CKD should be screened for cognitive impairment.Peer Reviewedhttp://deepblue.lib.umich.edu/bitstream/2027.42/78647/1/j.1532-5415.2009.02670.x.pd

Community Health Environment Scan Survey (CHESS): a novel tool that captures the impact of the built environment on lifestyle factors

Background: Novel1 1This study was performed on behalf of the Community Interventions for Health (CIH) collaboration. efforts and accompanying tools are needed to tackle the global burden of chronic disease. This paper presents an approach to describe the environments in which people live, work, and play. Community Health Environment Scan Survey (CHESS) is an empirical assessment tool that measures the availability and accessibility, of healthy lifestyle options lifestyle options. CHESS reveals existing community assets as well as opportunities for change, shaping community intervention planning efforts by focusing on community-relevant opportunities to address the three key risk factors for chronic disease (i.e. unhealthy diet, physical inactivity, and tobacco use). Methods: The CHESS tool was developed following a review of existing auditing tools and in consultation with experts. It is based on the social-ecological model and is adaptable to diverse settings in developed and developing countries throughout the world. Results: For illustrative purposes, baseline results from the Community Interventions for Health (CIH) Mexico site are used, where the CHESS tool assessed 583 food stores and 168 restaurants. Comparisons between individual-level survey data from schools and community-level CHESS data are made to demonstrate the utility of the tool in strategically guiding intervention activities. Conclusion: The environments where people live, work, and play are key factors in determining their diet, levels of physical activity, and tobacco use. CHESS is the first tool of its kind that systematically and simultaneously examines how built environments encourage/discourage healthy eating, physical activity, and tobacco use. CHESS can help to design community interventions to prevent chronic disease and guide healthy urban planning

Altered Growth Trajectory in Children Born to Mothers with Gestational Diabetes Mellitus and Preeclampsia

Purpose: Gestational diabetes mellitus (GDM) and preeclampsia are leading causes of mortality and morbidity in mothers and children. High childhood body mass index (BMI) is among their myriad of negative outcomes. However, little is known about the trajectory of the child BMI exposed to GDM and co-occurring preeclampsia from early to mid-childhood. This study examined the independent and joint impact of GDM and preeclampsia on childhood BMI trajectory. Methods: A population-based sample of 356 mothers were recruited from OB/GYN clinics in New York. Their children were then followed annually from 18 to 72 months. Maternal GDM and preeclampsia status were obtained from medical records. Child BMI was calculated based on their height and weight at annual visits. Results: Hierarchical Linear Modeling was used to evaluate the trajectories of child BMI exposed to GDM and preeclampsia. BMI trajectory by GDM decreased (t-ratio = -2.24, ��=.45, 95% CI=-.05-.95, p = .07), but the trajectory by preeclampsia increased over time (t-ratio = 3.153, ��=.65, 95%CI=.11-1.18, p = .002). Moreover, there was a significant interaction between the two (t-ratio = -2.24, ��=-1.244, 95%CI=.15-2.33, p = .02), such that the BMI of children born to mothers with both GDM and preeclampsia showed consistent increases over time. Conclusions: GDM and preeclampsia could be used as a marker for childhood obesity risk and the identification of a high-risk group, providing potential early intervention. These findings highlight the importance of managing obstetric complications, as an effective method of child obesity prevention

Nitrogen transfer from forage legumes to nine neighbouring plants in a multi-species grassland

Legumes play a crucial role in nitrogen supply to grass-legume mixtures for ruminant fodder. To quantify N transfer from legumes to neighbouring plants in multi-species grasslands we established a grass-legume-herb mixture on a loamy-sandy site in Denmark. White clover (Trifolium repens L.), red clover (Trifolium pratense L.) and lucerne (Medicago sativa L.) were leaf-labelled with 15N enriched urea during one growing season. N transfer to grasses (Lolium perenne L. and xfestulolium), white clover, red clover, lucerne, birdsfoot trefoil (Lotus corniculatus L.), chicory (Cichorium intybus L.), plantain (Plantago lanceolata L.), salad burnet (Sanguisorba minor L.)and caraway (Carum carvi L.) was assessed. Neighbouring plants contained greater amounts of N derived from white clover (4.8 gm-2) compared with red clover (2.2 gm-2) and lucerne (1.1 gm-2). Grasses having fibrous roots received greater amounts of N from legumes than dicotyledonous plants which generally have taproots. Slurry application mainly increased N transfer from legumes to grasses. During the growing season the three legumes transferred approximately 40 kg N ha-1 to neighbouring plants. Below-ground N transfer from legumes to neighbouring plants differed among nitrogen donors and nitrogen receivers and may depend on root characteristics and regrowth strategies of plant species in the multi-species grassland