Non-agricultural land use and land reform: theory and evidence from Brazil

This paper examines the effect of nonagricultural land use on agrarian organization and land reform, providing a simple model to determine its policy implications and some evidence on its importance. It is argued that, if land-rental market is imperfect, there is a role for redistributive land policies and the following implications hold: (i) land reform is more probable to enhance efficiency in a low-wage economy; (ii) such policies should aim small farmers instead of landless people, obtaining land from large landholders. Empirical evidence suggests this is a relevant issue in Brazil, specially during periods of high macroeconomic instability.land reform; land use; agricultural development

Domestic climate policies and the WTO

Experience with existing multilateral environmental agreements (MEAs) shows that trade measures agreed to within the MEAs themselves may not necessarily lead to a dispute between parties. On the contrary, there is a great chance that disputes may arise from national measures undertaken to fulfil those obligations under the MEAs. This possibility of conflict with their WTO obligations may well arise in implementing the Kyoto Protocol, given that Article 2 of the Protocol gives Annex 1 countries considerable flexibility in the choice of domestic policies to meet their greenhouse gas emissions commitments. It is highly likely that Annex 1 governments with differentiated legal and political systems might pursue their domestic policies in such a way as to unfairly favour domestic producers over foreign ones. Such differential treatments could occur in governing eligibility for, and the amount of, the subsidy, in establishing energy efficiency standards, in the determinations of the category of eco-labelled products and the procedures of establishing eco-labels, in the specifications in tenders, and in specifying condition for participating in government procurement bids. In case where a country unilaterally imposes a carbon tax, it may adjust taxes at the border to mitigate competitiveness effects of cheaper imports not subject to a similar level of the carbon tax in the country of origin. Measure of this sort may well raise complex questions with respect to the WTO consistency and the conditions under which border taxes can be adjusted to accommodate a loss of international competitiveness. All this clearly indicates the necessity of addressing policy coordination between the trade and climate regimes. Against this background, this paper discusses carbon/energy taxes, subsidies, energy efficiency standards, eco-labels and government procurement policies, and explores the potential interaction between these domestic climate polices and WTO rules. It highlights their potential conflicts, and argues that such conflicts can be avoided or at least minimized if WTO rules are carefully scrutinised at the time Annex 1 governments undertake measures to achieve the required reductions in emissions. The paper suggests an early process of pursuing consultations between WTO members and the Parties to the Climate Change Convention and points to the need of further exploring ways to enhance synergies between the trade and climate regimes.Carbon taxes; energy taxes; subsidies; energy efficiency standards; eco-labels; government procurement; WTO; climate change

Land taxes in a Latin American context

Since Henry George (1839-1897) economists have been arguing that a tax on unim- proved land is an ideal tax on e¢ ciency grounds. Output taxes, on the other hand, have distortional e¤ects on the economy. This paper shows that under asymmetric information output tax might be used along with land tax in order to implement the optimal taxation scheme in a Latin-American context, i.e., in an economy with imperfect land-rental market, non-agricultural land use and non-revenue objectives of land taxation. Also, we show that: (i) schemes based on land taxes alone might not be implementable; and (ii) tax evasion is more acute among large landholders.Optimal taxation, tax evasion, land use.

Testing competing explanations for the inverse productivity puzzle

We use plot-level data from ICRISAT to assess competing explanations for an old empirical regularity - the inverse relationship between land productivity and farm size. The presence of farmers who simultaneously crop multiple plots with di¤erent sizes is used to test (and reject) explanations based on household heterogeneity. The panel nature of the data is explored to test (and refuse) explanations based on plot fixed characteristics. We are then left with explanations based on time-varying plot features or measurement errors in the plot size. Theoretically, the input choices should reflect both plot-specific features and the true plot size. Empirically, the inverse relationship vanishes when we control for input use.Development, farm size, productivity.

Financial constraints, migration and inequality

Although the self-selection of emigrants is determined by di¤erences in the returns to education, according to the celebrated Roy model, empirical evidence suggests that migrants tend to be favorably selected. This paper argues that financial con- straints might be useful to explain this controversy. These constraints might impose positive correlations between (i) wealth and education, and (ii) wealth and migra- tion, implying a positive bias in the empirical results. We also show that high levels of migration premium and return to education in the source country explain the migration of middle-class individuals, a situation in which migration increases in- equality in the home country.migration, financial constraints, self-selection, human capital