Who benefits from Zero-Ratings? A Brief Note on the South African VAT System

Twenty years after overcoming Apartheid, South Africa still suffers from poverty and inequality. Recent data (Income and Expenditure Survey 2011) indicates that one third of the population lives on less than USD 0.70 per day while the upper tercile has USD 28 available. The country also faces other complex challenges, including high levels of unemployment, a resource-biased economy and low levels of education, and structural reforms are much needed to put the economy on a path of sustained growth. However, structural reforms require a broad consent within society, and inequality, clearly, is a major hindrance to this. By choosing how to collect revenue and how to spend it, South Africa's government has two instruments at their disposal in order to alleviate inequality and facilitate reform. Like most modern economies, South Africa is increasingly relying on indirect taxation. The combined revenue generated by VAT, excise taxes, and the fuel and gas levy, make up 35% of total revenue. In the light of growing income inequality, this development is remarkable as wealthy individuals tend to spend a smaller proportion of their income on consumption. Indirect taxation thus potentially places a relatively higher burden on the poor. To counteract an aggravation of income inequality, a range of commodities, held to be important for the poor, are currently zero-rated under South Africa's VAT system. And some studies find that this policy measure is partly effective in reducing the regressive effect (Fourie and Owen, 1993; Jansen et al., 2012). However, while studies on the regressive effect of VAT are potentially valuable, they are certainly non-conclusive in appraising the welfare consequences of zero-ratings. Increasing the rates on such commodities would not only entail an increased burden on the poor, but also an increase in governmental revenues. Depending on the redistribution of such additional revenues, the poor could either benefit or not from this reform and the conclusion would be fairly independent from the overall regressiveness of the system. In this paper, we re-evaluate the effectiveness of zero-rating as a measure to alleviate poverty in South Africa and extend earlier work by incorporating both sides of fiscal action in our analysis. We clarify the interlink between welfare effects and consumption taxation by retracing a simple model developed by Keen (2013), in Section 2, which we then apply to the South African case. In doing so, we employ data from the most recent Income and Expenditure survey to derive distributions of household spending and governmental spending in Section 3. We conclude in Section 4. (authors' abstract)Series: WU International Taxation Research Paper Serie

The Power of Related Articles – Improving Fake News Detection on Social Media Platforms

Social media is increasingly used as a platform for news consumption, but it has also become a breeding ground for fake news. This serious threat poses significant challenges to social media providers, society, and science. Several studies have investigated automated approaches to fighting fake news, but little has been done to improve fake news detection on the users’ side. A simple but promising approach could be to broaden users\u27 knowledge to improve the perceptual process, which will improve detection behavior. This study evaluates the impact of a digital nudging approach which aims to fight fake news with the help of related articles. 322 participants took part in an online experiment simulating the Facebook Newsfeed. In addition to a control group, three treatment groups were exposed to different combinations of related articles. Results indicate that the presence of controversial related articles has a positive influence on the detection of fake news

PSF reconstruction for NAOS-CONICA

Adaptive optics (AO) allows one to derive the point spread function (PSF) simultaneously to the science image, which is a major advantage in post-processing tasks such as astrometry/photometry or deconvolution. Based on the algorithm of \citet{veran97}, PSF reconstruction has been developed for four different AO systems so far: PUEO, ALFA, Lick-AO and Altair. A similar effort is undertaken for NAOS/VLT in a collaboration between the group PHASE (Onera and Observatoire de Paris/LESIA) and ESO. In this paper, we first introduce two new algorithms that prevent the use of the so-called "$U\_{ij}$ functions" to: (1) avoid the storage of a large amount of data (for both new algorithms), (2) shorten the PSF reconstruction computation time (for one of the two) and (3) provide an estimation of the PSF variability (for the other one). We then identify and explain issues in the exploitation of real-time Shack-Hartmann (SH) data for PSF reconstruction, emphasising the large impact of thresholding in the accuracy of the phase residual estimation. Finally, we present the data provided by the NAOS real-time computer (RTC) to reconstruct PSF ({\em (1)} the data presently available, {\em (2)} two NAOS software modifications that would provide new data to increase the accuracy of the PSF reconstruction and {\em (3)} the tests of these modifications) and the PSF reconstruction algorithms we are developing for NAOS on that basis.Comment: 12 pages & 13 figures. To be published in the proceedings of the SPIE conference Advances in Adaptive Optics - Astronomical Telescopes & Instrumentation, 24-31 May 2006, Orland