Social Spending and Aggregate Welfare in Developing and Transition Economies

Notwithstanding the unprecedented attention devoted to reducing poverty and fostering human development via scaling up social sector spending, there is surprisingly little rigorous empirical work on the question of whether social spending is effective in achieving these goals. This paper examines the impact of government spending on the social sectors (health, education, and social protection) on two major indicators of aggregate welfare (the Inequality-adjusted Human Development Index and child mortality), using a panel dataset comprising 55 developing and transition countries from 1990 to 2009. We find that government social spending has a significantly positive causal effect on the Inequality-adjusted Human Development Index, while government expenditure on health has a significant negative impact on child mortality rate. These results are fairly robust to the method of estimation, the use of alternative instruments to control for the endogeneity of social spending, the set of control variables included in the regressions, and the use of alternative samples

Party System Institutionalization and Reliance on Personal Income Tax in Developing Countries

This paper explores the effect of party system institutionalization on the relevance of the personal income tax in the tax composition. Based on a fiscal contractualism approach, it is argued that institutionalized political party systems increase the capacity of political actors to credibly commit to fiscal contracts agreed with wealthy taxpayers. Consequently, in countries characterized by institutionalized political party systems wealthy taxpayers accept paying a bigger share of the tax burden, as reflected in a greater relevance of progressive tax types. The analysis of panel data for more than 90 countries from 1990 to 2010 supports this hypothesis, showing that party system institutionalization has an especially significant and strong positive effect on the relevance of the personal income tax where bureaucratic capacity is low. At high levels of bureaucratic capacity the effect disappears. The findings strongly support the claim that, particularly in developing countries, where bureaucratic capacity tends to be limited, taxation is best understood as a problem of credible commitment

Tree community variation in a tropical continental island according to slope aspect and human interference

ABSTRACT Associating description of unrecorded tropical tree community structure to sampling approaches that can help determine mechanisms behind floristic variation is important to further the comprehension of how plant species coexist at tropical forests. Thus, this study had the goals of (i) evaluating tree community structure on the continental island of Marambaia (23°4’37.09”S; 43°59’2.15”W) and (ii) testing the prediction that there are local scale changes in a tropical tree community structure between slopes facing different geographic orientation and with distinct human interference history. We established 60 (0.6 ha) sampling units in three different slope sites with distinct predominant geographic orientation and human interference. We sampled all woody trees with diameter at breast height (dbh) ≥ 5 cm. We found a total of 1.170 individuals representing 220 species, 120 genera and 50 families. The overall tree community structure and structural descriptors (abundance of individuals, basal area, species richness and diversity) varied extensively between the sites. The evidence presented here supports that local scale topography variations and human interference history can be important factors contributing to the known floristic heterogeneity of the Atlantic Rainforest. Future work on the study area should focus on disentangling effects from distinct causal factors over tree community variation and species occurrence

Apples, oranges and lemons: public sector debt statistics in the 21st century

In both academic research and policymaking, public sector debt and debt-to-GDP ratios are relied on for a multitude of important economic, political and socioeconomic decisions, especially as public sector balance sheets expand to an unprecedented size in the midst of the 2019–2020 COVID pandemic. The reliance on available data from reputable sources often overlooks the question of whether the denominator in this ratio is accurately measured or how well the denominator is understood by the audience interpreting it. Building on past work in international financial statistics, and making use of a unique and newly created dataset on media reporting of public sector debt, the purpose of this article is to examine the quality, accuracy, interpretation and overall meaningfulness of public sector financial statistics. The main findings suggest that i) most of the world’s governments still do not seem to feel sufficient pressure to voluntarily provide comprehensive financial statistics based on well-defined modern methodological frameworks and ii) high profile financial statistics, which are reported, have become increasingly numerous and complicated, making it difficult for non-experts to know which is most appropriate in the context of their analysis