Commitment to Equity: A Primer Nora Lusg · 2019-11-07 · Teams and references by country: (in...
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Commitment to Equity: A Primer Nora Lus5g Tulane University, CGD, IAD The World Bank Washington, DC, February 1, 2016
Transcript of Commitment to Equity: A Primer Nora Lusg · 2019-11-07 · Teams and references by country: (in...
CommitmenttoEquity:APrimerNoraLus5g
TulaneUniversity,CGD,IAD
TheWorldBankWashington,DC,February1,2016
Outline
• WhatistheCommitmenttoEquityIns2tuteandwhatdoesitdo?
• Methodologicalhighlights• Countrycoverage• CEQAssessments:AQuickGlanceatResults• Futurework
2
WHATISTHECOMMITMENTTOEQUITYINSTITUTE?
CommitmenttoEquityIns5tute(CEQI)
• Research-basedpolicytools• DataCenter• Advisoryandtrainingservices• Bridgestopolicy
Ø GrantfromBill&MelindaGatesFounda2onUS4.9millionfor5yrs
4
CEQAssessment:Tools§ Handbook:Lus2gandHiggins,currentversionSept2013,
updatedFeb2016;includessampleStatacode§ CEQHandbook2016(forthcoming)
Lus2g,Nora,editor.CommitmenttoEquityHandbook:Es4ma4ngtheRedistribu4veImpactofFiscalPolicy,TulaneUniversityandtheWorldBank
§ MasterWorkbook:ExcelSpreadsheettopresentbackgroundinforma2on,assump2onsandresults.(MWB2016Betaversion)
§ Diagnos5cQues5onnaire:=>availableonwebsite§ AdoStataFiles:(MWB2016Betaversion)
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Mainmessages1. Analyzingthetaxsidewithoutthe
spendingside,orviceversa,isnotveryusefulØ Taxescanbeunequalizingbutspendingsoequalizingthattheunequalizingeffectoftaxesismorethancompensated
Ø Taxescanberegressivebutwhencombinedwithtransfersmakethesystemmoreequalizingthanwithouttheregressivetaxes
Ø Transferscanbeequalizingbutwhencombinedwithtaxes,post-fiscpovertycanbehigher
6Lambert,2001;Lus2getal.,forthcoming
Mainmessages
2. Analyzingtheimpactoninequalityonlycanbemisleading
Ø Fiscalsystemscanbeequalizingbutpovertyincreasing
7Lus2g,forthcoming
Mainmessages
3. Analyzingtheimpactontradi2onalpovertyindicatorscanbemisleading
Ø Fiscalsystemscanshowareduc2oninpovertyandyetasubstan2alshareofthepoorcouldhavebeenimpoverishedbythecombinedeffectoftaxesandtransfers
8HigginsandLus2g(2015)
METHODOLOGICALHIGHLIGHTS
CEQAssessment:Method
§ Reliesonstate-of-thearttaxandbenefitincidenceanalysis• Ongoingconsulta2onwithexpertstoimproveeconomicincidencees2mates
§ Usesconven2onalandnewlydevelopedindicatorstoassessprogressivity,pro-poornessandeffec2venessoftaxesandtransfers
§ Allowstoiden2fythecontribu2onofindividualfiscalinterven2onstoequityandpovertyreduc2onobjec2ves
10Lus2g&Higgins(2013)
CEQAssessment:FiscalIncidenceAnalysis
Yh=Ih-∑iTiSih+∑jBjSjh
11
Incomea[ertaxes
andtransfers
Incomebeforetaxesandtransfers
Taxes Transfers
Shareoftaxipaidbyunit
h
Shareoftransferj
receivedbyunith
CEQAssessment:FiscalInterven5ons• Currentlyincluded:– Directtaxes– Directcashtransfers– Non-cashdirecttransferssuchasschooluniformsandbreakfast
– Contribu2onstopensionsandsocialinsurancesystems– Indirecttaxesonconsump2on– Indirectsubsidies– In-kindtransferssuchasspendingoneduca2onandhealth
• Workingon:– Corporatetaxes– Housingsubsidies
12Lus2g&Higgins(2013)
MARKETINCOME
DISPOSABLEINCOME
PLUSDIRECTTRANSFERSMINUSDIRECTTAXES
PLUSINDIRECTSUBSIDIESMINUSINDIRECTTAXES
POST-FISCALorCONSUMABLEINCOME
PLUSMONETIZEDVALUEOFPUBLICSERVICES:EDUCATION&HEALTH
FINALINCOME
CEQAssessment:IncomeConcepts
13
FiscalIncidenceinCEQAssessments§ Accoun2ngapproach• nobehavioralresponses• nogeneralequilibriumeffectsand• nointertemporaleffects• butitincorporatesassump2onstoobtaineconomicincidence(notstatutory)
§ Point-in-2me§ Mainlyaverageincidence;afewcaseswithmarginal
incidence
14Lus2g&Higgins(2013)
FiscalIncidenceinCEQAssessments
§ Comprehensivestandardfiscalincidenceanalysisofcurrentsystems:directpersonalandindirecttaxes(nocorporatetaxes);cashandin-kindtransfers(publicservices);indirectsubsidies
§ Harmonizeddefini2onsandmethodologicalapproachestofacilitatecross-countrycomparisons
§ Usesincome/consump2onpercapitaasthewelfareindicator§ Allocatorsvary=>fulltransparencyinthemethodusedfor
eachcategory,taxshiiingassump2ons,taxevasion§ Secondarysourcesareusedtoaminimum
15Lus2g&Higgins(2013)
Alloca5onMethods§ DirectIden2fica2oninmicrodata
§ However,resultsmustbechecked:howrealis2carethey?
§ Ifinforma2onnotdirectlyavailableinmicrodata,then:§ Simula2on§ Imputa2on§ Inference§ Predic2on§ AlternateSurvey§ SecondarySources
16Lus2g&Higgins(2013)
TaxShi[ingAssump5ons• Economicburdenofdirectpersonalincometaxesis
bornebytherecipientofincome• Burdenofpayrollandsocialsecuritytaxesisassumedto
fallen2relyonworkers• Consump2ontaxesareassumedtobeshiiedforwardto
consumers.• Theseassump2onsarestrongbecausetheyimplythat
laborsupplyisperfectlyinelas2candthatconsumershaveperfectlyinelas2cdemand
• Inprac2ce,theyprovideareasonableapproxima2on(withimportantexcep2onssuchaswhenexaminingeffectofVATreforms),andtheyarecommonlyused
17Lus2g&Higgins(2013)
TaxEvasionAssump5ons:CaseSpecific§ Incometaxesandcontribu2onstoSS:
§ Individualswhodonotpar2cipateinthecontributorysocialsecuritysystemareassumednottopaythem
§ Consump2ontaxes
§ Placeofpurchase:informalmarketsareassumednottochargethem
§ Somecountryteamsassumedsmalltownsinruralareasdonottopaythem
18Lus2g&Higgins(2013)
Mone5zingin-kindtransfers§ Incidenceofpublicspendingoneduca2onandhealthfollowedso-
called“benefitorexpenditureincidence”orthe“governmentcost”approach.
§ Inessence,weuseperbeneficiaryinputcostsobtainedfromadministra2vedataasthemeasureofaveragebenefits.
§ Thisapproachamountstoaskingthefollowingques2on:Ø Howmuchwouldtheincomeofahouseholdhavetobe
increasedifithadtopayforthefreeorsubsidizedpublicserviceatthefullcosttothegovernment?
19Lus2g&Higgins(2013)
TreatmentofContributorySocialInsurancePensions
• Deferredincomeinactuariallyfairsystems:pensionsincludedinmarketincomeandcontribu2onstreatedasmandatorysavings
• Governmenttransfer:pensionsincludedamongdirecttransfersandcontribu2onstreatedasadirecttax
20Lus2g&Higgins(2013)
ScenariosandRobustnessChecks§ Benchmarkscenario§ Sensi2vityto:• Changingtheoriginalincomebywhichhhareranked:e.g.,marketincomepluscontributorypensionsanddisposableincome
• Usingconsump2onvs.income• Percapitavs.equivalizedincomeorconsump2on• Differentassump2onsonscaling-downorup• Differentassump2onsontake-upoftransfersandtaxshiiingandevasion
• Alterna2vevalua2onsofin-kindservices• Othersensi2vityscenarios:country-specific
21Lus2g&Higgins(2013)
COUNTRYCOVERAGE
23
www.commitmentoequity.org
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ColorKey
Argentina Georgia Nicaragua Vietnam Green:FinishedArmenia Ghana Pakistan Zambia Orange:Finishedwithinnext6monthsBolivia Greece Paraguay White:EarlystagesBrazil Guatemala Peru Grey:PossibleCambodia Honduras PolandChile India RussiaChina Indonesia SouthAfricaColombia Iran SriLankaComoros IvoryCoast TanzaniaCostaRica Jordan TogoDomRep KyrgyzRepublicTunisiaEcuador Mali UgandaEgypt Mexico UnitedStatesElSalvador MozambiqueUruguayEthiopia Namibia Venezuela
CEQCountries(47)
FISCALPOLICY,INEQUALITYANDPOVERTYINMIDDLEINCOMECOUNTRIES:BRAZIL,CHILE,COLOMBIA,INDONESIA,MEXICO,PERUANDSOUTHAFRICA
Basedon:• Lus2g,Nora.2015b.
InequalityandFiscalRedistribu4oninMiddleIncomeCountries:Brazil,Chile,Colombia,Indonesia,Mexico,PeruandSouthAfrica.EvidencefromtheCommitmenttoEquityProject(CEQ).CEQWorkingPaperNo.31,CenterforInter-AmericanPolicyandResearchandDepartmentofEconomics,TulaneUniversityandInter-AmericanDialogue.
• IndonesiaandSouthAfrica,partofcollabora2veprojectwithGabrielaInchauste,WorldBank.Willbepublishedin:Inchauste,GabrielaandNoraLus2g(Eds.),TheDistribu4onalImpactofFiscalPolicy:ExperiencefromDevelopingCountries.WorldBank,Washington,D.C
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Teamsandreferencesbycountry:
(inparenthesis:surveyyear;C=consump5on&I=income)
1. Bolivia(2009;I):PazArauco,Verónica,GeorgeGrayMolina,WilsonJiménezPozo,andErnestoYáñezAguilar.2014.“ExplainingLowRedistribu2veImpactinBolivia.”InLus2g,Nora,CarolaPessinoandJohnScos.2014.Editors.TheRedistribu4veImpactofTaxesandSocialSpendinginLa4nAmerica.SpecialIssue.PublicFinanceReview,May,Volume42,Issue3.(September22,2014)
2. Brazil(2009;I):Higgins,SeanandClaudineyPereira.2014.“TheEffectsofBrazil’sTaxa2onandSocialSpendingontheDistribu2onofHouseholdIncome.”InLus2g,Nora,CarolaPessinoandJohnScos.2014.Editors.TheRedistribu4veImpactofTaxesandSocialSpendinginLa4nAmerica.SpecialIssue.PublicFinanceReview,May,Volume42,Issue3.(November4,2014)
3. Chile(2009,I):Ruiz-Tagle,JaimeandDanteContreras.2014.CEQMasterworkbook,TulaneUniversity(August27,2014)
4. Colombia(2010,I):Melendez,MarcelaandNoraLus2g.2014.CEQMasterworkbook,TulaneUniversity(November21,2014)
5. CostaRica(2010;I):Sauma,JuanandDiegoTrejos.2014.SocialPublicSpending,Taxes,Redistribu4onofIncome,andPovertyinCosta.CEQWorkingPaperNo.18,CenterforInter-AmericanPolicyandResearchandDepartmentofEconomics,TulaneUniversityandInter-AmericanDialogue,January.(February2014)
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7. Ecuador:LlerenaPinto,FreddyPaul,MaríaChris2naLlerenaPinto,RobertoCarlosSaáDaza,andMaríaAndreaLlerenaPinto.2015.SocialSpending,TaxesandIncomeRedistribu4oninEcuador.CEQWorkingPaperNo.28,CenterforInter-AmericanPolicyandResearchandDepartmentofEconomics,TulaneUniversityandInter-AmericanDialogue,February.
8. ElSalvador(2011;I):Beneke,Margarita,NoraLus2gyJoséAndrésOliva.2015.ElimpactodelosimpuestosyelgastosocialenladesigualdadylapobrezaenElSalvador.CEQWorkingPaperNo.26,CenterforInter-AmericanPolicyandResearchandDepartmentofEconomics,TulaneUniversityandInter-AmericanDialogue,February.(March11,2014)
9. Guatemala(2011;I):Cabrera,Maynor,NoraLus2gandHilcíasMorán.2014.FiscalPolicy,InequalityandtheEthnicDivideinGuatemala.CEQWorkingPaperNo.20,CenterforInter-AmericanPolicyandResearchandDepartmentofEconomics,TulaneUniversityandInter-AmericanDialogue,October.(April13,2014)
10. Indonesia(2012;C):Avar,Rythia,JonJellemaandMashewWai-Poi.2014.CEQMasterWorkbook,TulaneUniversityandTheWorldBank(February18,2014)
11. Mexico(2010;I):Scos,John.2014.“Redistribu2veImpactandEfficiencyofMexico’sFiscalSystem.”InLus2g,Nora,CarolaPessinoandJohnScos.2014.Editors.TheRedistribu4veImpactofTaxesandSocialSpendinginLa4nAmerica.SpecialIssue.PublicFinanceReview,May,Volume42,Issue3.(September2013)
28
13. Peru(2009;I):Jaramillo,Miguel.2014.“TheIncidenceofSocialSpendingandTaxesinPeru.”InLus2g,Nora,CarolaPessinoandJohnScos.2014.Editors.TheRedistribu4veImpactofTaxesandSocialSpendinginLa4nAmerica.SpecialIssue.PublicFinanceReview,May,Volume42,Issue3.(May1,2013)
14. SouthAfrica(2010;I):Inchauste,Gabriela,NoraLus2g,MashekwaMaboshe,CatrionaPurfieldandIngridWollard.2015.TheDistribu4onalImpactofFiscalPolicyinSouthAfrica.PolicyResearchWorkingPaper7194,TheWorldBank,February.(May5,2014)
15. UnitedStates(2011;I):Higgins,Sean,NoraLus2g,WhitneyRubleandTimothySmeeding(forthcoming)ComparingtheIncidenceofTaxesandSocialSpendinginBrazilandtheUnitedStates,ReviewofIncomeandWealth
16. Uruguay(2009;I):Bucheli,Marisa,NoraLus2g,MáximoRossi,andFlorenciaAmábile.2014.“SocialSpending,TaxesandIncomeRedistribu2oninUruguay.”InLus2g,Nora,CarolaPessinoandJohnScos.2014.Editors.TheRedistribu4veImpactofTaxesandSocialSpendinginLa4nAmerica.SpecialIssue.PublicFinanceReview,May,Volume42,Issue3.(August18,2014)
29
HouseholdSurveysUsedinCountryStudies
1. Armenia:IntegratedLivingCondi2onsSurvey,2011(I)2. Bolivia:EncuestadeHogares,2009(I)3. Brazil:PesquisadeOrçamentosFamiliares,2009(I)4. Chile:EncuestadeCaracterizaciónSocial(CASEN),2009(I)5. Colombia:EncuestadeCalidaddeVida,2010(I)6. CostaRica:EncuestaNacionaldeHogares,2010(I)7. Ecuador:EncuestaNacionaldeIngresosyGastosdelosHogaresUrbanoyRural,2011-2012(I)8. ElSalvador:EncuestaDeHogaresDePropositosMul2ples,2011(I)9. Ethiopia:EthiopiaHouseholdConsump2onExpeditureSurveyandEthiopiaWelfareMonitoringsurvey,2011
(C)10. Guatemala:EncuestaNacionaldeIngresosyGastosFamiliares,2010(I)11. Indonesia:SurveiSosial-EkonomiNasional,2012(C)12. Mexico:EncuestaNacionaldeIngresoyGastodelosHogares,2010(I)13. Peru:EncuestaNacionaldeHogares,2009(I)14. SouthAfrica:IncomeandExpenditureSurveyandNa2onalIncomeDynamicsStudy,2010-2011(I)15. Uruguay:EncuestaCon2nuadeHogares,2009(I)
Note:Thelesers"I"and"C"indicatethatthestudyusedincomeorconsump2ondata,respec2vely.30
SIZEANDCOMPOSITIONOFGOVERNMENTSOCIALSPENDINGANDREVENUES
Figure 1: Size and composition of government budgets (circa 2010)
Panel a: Composition of Social Spending as a Share of GDP
02,0004,0006,0008,00010,00012,00014,00016,00018,00020,000
0.0%
5.0%
10.0%
15.0%
20.0%
25.0%
30.0%
Indo
nesia*(201
2)
Peru(200
9)
Chile**(200
9)
Colombia(20
10)
Mexico(20
10)
South
Africa***(201
0)
Brazil(20
09)
Seven
Coun
tries
OECD
(rankedNbyNsocialNspending/GDP)
DirectNTransfers Education Health ContributoryNPensions OtherNSocialNSpending GNINperNcapitaN(2011NPPP)
32
Panel b: Composition of Total Government Revenues as a Share of GDP
02,0004,0006,0008,00010,00012,00014,00016,00018,00020,000
0.00%
10.00%
20.00%
30.00%
40.00%
50.00%
60.00%Indo
nesia*(2012)
Colombia(2010
)
Chile**(2009)
Mexico(20
10)
Peru(200
9)
South
Africa***(201
0)
Brazil(2009
)
(rankedJbyJtotalJgovernmentJrevenue/GDP)
DirectJTaxes IndirectJandJOtherJTaxes SocialJSecurityJContributions
OtherJRevenues GNIJperJcapitaJ(2011JPPP)
33
34
BOL$
BRA$
SLV$
GTM$
MEX$
PER$
URY$AMR$
ETH$
IND$
ZAF$
COL$
CHL$
BOL$
BRA$$
SLV$
GTM$
MEX$PER$
URY$
AMR$
ETH$
IND$
ZAF$
COL$CHL$
0%$
5%$
10%$
15%$
20%$
25%$
30%$
35%$
40%$
45%$
0$ 2000$ 4000$ 6000$ 8000$ 10000$ 12000$ 14000$ 16000$ 18000$ 20000$
GNI/Capita$(2011$PPP)�
Primary'and'Social'Spending/GDP'vs'GNI/capita�
Primary$Spending/GDP$ Social$Spending/GDP$Source:Lus2g(2015a)
FISCALPOLICYANDINEQUALITY
MARKETINCOME
DISPOSABLEINCOME
PLUSDIRECTTRANSFERSMINUSDIRECTTAXES
PLUSINDIRECTSUBSIDIESMINUSINDIRECTTAXES
POST-FISCALorCONSUMABLEINCOME
PLUSMONETIZEDVALUEOFPUBLICSERVICES:EDUCATION&HEALTH
FINALINCOME
CEQAssessment:IncomeConcepts
36
FiscalRedistribu5on:Brazil,Chile,Colombia,Indonesia,MexicoandSouthAfrica
37
0.35%
0.40%
0.45%
0.50%
0.55%
0.60%
0.65%
0.70%
0.75%
0.80%
Market%Income% Disposable%Income%
Post<fiscal%Income% Final%Income%
Brazil%(2009)% Chile%(2009)% Colombia%(2010)%Indonesia%(2012)% Mexico%(2010)% Peru%(2009)%South%Africa%(2010)%
GiniCoefficient,circa2010
Source:Lus2g(2015a)
Redistributive Effect: Brazil, Chile, Colombia, Indonesia, Mexico, Peru, South Africa, EU and the United States
(Change in Gini Points: Market to Disposable Income; circa 2010)
0.0000
0.1000
0.2000
0.3000
0.4000
0.5000
0.6000
0.7000
0.8000
0.0000
0.0500
0.1000
0.1500
0.2000
Market'Incom
e'Gini
Redistrib
utive'Effect:'M
arket'to'Disposab
le
Pension1as1Market1Income Pension1as1Transfer
Market1Income1Gini,1Pensions1Mkt1Inc Market1Income1Gini,1Pensions1as1Transf
38
39
Table&4:&Marginal&Contribution&of&Taxes&and&Transfers&(circa&2010)(Pensions&as&Market&Income)
Brazil Chile* Colombia Indonesia** Mexico& Peru& SA*** Average
Marginal&Contributions
From&Market&to&Disposable&Income
Redistributive&Effect 0.0453 0.0340 0.0075 0.0044 0.0236 0.0099 0.0788 0.0291
Direct2taxes 0.0148 0.0154 0.0018 6 0.0131 0.0055 0.0269 0.0129
Direct2transfers 0.0320 0.0190 0.0057 0.0044 0.0109 0.0045 0.0593 0.0194
From&Market&&to&PostLfiscal&Income
Redistributive&Effect 0.0446 0.0370 0.0073 0.0061 0.0308 0.0151 0.0789 0.0314
Direct2taxes 0.0171 0.0179 0.0019 6 0.0140 0.0060 0.0311 0.0147
Direct2transfers 0.0382 0.0220 0.0057 0.0043 0.0113 0.0048 0.0711 0.0225
Indirect2taxes 60.0014 0.0027 60.0017 60.0028 0.0027 0.0052 0.0000 0.0007
Indirect2subsidies 0.0008 0.0004 0.0015 0.0052 0.0047 6 6 0.0025
Kakwani
Direct2taxes 0.1738 0.3481 0.1373 0.0000 0.2411 0.3853 0.1109 0.1995
Direct2transfers2 0.5310 0.9064 0.9233 0.6248 0.7931 0.9612 1.0165 0.8223
Indirect2taxes 60.0536 60.0172 60.1986 60.0513 0.0129 0.0527 60.0788 60.0477
Indirect2subsidies 0.8295 0.7978 0.5034 0.0645 0.2457 0.0000 0.0000 0.3487
Figure 4. Redistribution and social spending, 2010
BRA
CHL
COL
IDN
MEX
PER
ZAF
0.0000
0.0200
0.0400
0.0600
0.0800
0.1000
0.1200
0.1400
0.1600
0.1800
0.2000
0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0%
RestributiveCEffect
SocialCSpending
40Source:Lus2g(2015b
A. Redistribution and market income inequality
BRA
CHL
COL
IDN
MEX
PER
ZAF
0.0000
0.0200
0.0400
0.0600
0.0800
0.1000
0.1200
0.1400
0.1600
0.1800
0.2000
0.3800 0.4300 0.4800 0.5300 0.5800 0.6300 0.6800 0.7300 0.7800 0.8300
Redistrib
uiveDEffe
ct
GiniDMarketDIncome41
Source:Lus2g(2015b
FISCALPOLICYANDPOVERTYREDUCTION
Fiscal Policy and Poverty Reduction (circa 2010) (Change in Headcount Ratio from Market to Post-fiscal Income for Pensions in Market
Income and Pensions in Transfers; in %) a
!35.0%
!30.0%
!25.0%
!20.0%
!15.0%
!10.0%
!5.0%
0.0%
5.0%
10.0%
15.0%
Brazil/(2009) Colombia(2010)
Indonesia*(2012)
Peru/(2009) Mexico/(2010) South/Africa**(2010)
Chile***(2009)
Pensions/as/Market/Income Pensions/as/Transfer
43
WHOPAYSFORWHATTHEGOVERNMENTSPENDS?
Net Payers to the Fiscal System (circa 2010) Panel a: Pensions as Market Income
Brazil(2009)
SouthAfrica***(2010)
Peru(2009)
Mexico(2010)
Colombia(2010)
Chile**(2009)
Indonesia*(2012)
NetBReceiversNetBPayers
y<1.25 1.25<=y<2.5 2.5<=y<4 4<=y<10 10<=y<50 y>=50
45Source:Lus2g(2015b)
FISCALPOLICY,INEQUALITYANDPOVERTYINAFRICANCOUNTRIES:ETHIOPIA,GHANAANDTANZANIA
47
BOL$
BRA$
SLV$
GTM$
MEX$
PER$
URY$AMR$
ETH$
IND$
ZAF$
COL$
CHL$
BOL$
BRA$$
SLV$
GTM$
MEX$PER$
URY$
AMR$
ETH$
IND$
ZAF$
COL$CHL$
0%$
5%$
10%$
15%$
20%$
25%$
30%$
35%$
40%$
45%$
0$ 2000$ 4000$ 6000$ 8000$ 10000$ 12000$ 14000$ 16000$ 18000$ 20000$
GNI/Capita$(2011$PPP)�
Primary'and'Social'Spending/GDP'vs'GNI/capita�
Primary$Spending/GDP$ Social$Spending/GDP$Source:Lus2g(2015a)
CEQAssessmentforEthiopia(WorldBank,2014,Ch.5)
48
Pro-poornessofEduca5onSpending
49
Pro$poor&CC&is&negative
Same&per&capita&for&all;&CC&=0
Progressive&CC&positive&but&lower&than&market&income&Gini
Pro$poor&CC&is&negative
Same&per&capita&for&all;&CC&=0
Progressive&CC&positive&but&lower&than&market&income&Gini
Pro$poor&CC&is&negative
Same&per&capita&for&all;&CC&=0
Progressive&CC&positive&but&lower&than&market&income&Gini
Regressive&CC&positive&AND&higher&than&market&income&Gini
Armenia&(2011) + + +Bolivia&(2009) + + +Brazil&(2009) + + +&Chile&(2009) + + +Colombia&(2010) + + +El&Salvador&(2011) + + +*Ethiopia&(2011) + + +Guatemala&(2010) + + +Indonesia&(2012) + + +Mexico&(2010) + + +Peru&(2009) + + +South&Africa&(2010) + + +Uruguay&(2009) + + +*
Primary Secondary Tertiary
Source:Lus2g(2015a)
Pro-poornessofHealthSpending
50
Pro$poor&CC&is&negative
Same&per&capita&for&all;&CC&=0
Progressive&CC&positive&but&lower&than&market&income&Gini
Armenia&(2011) +Bolivia&(2009) +Brazil&(2009) +&Chile&(2009) +Colombia&(2010) +El&Salvador&(2011) +Ethiopia&(2011) +Guatemala&(2010) +Indonesia&(2012) +Mexico&(2010) +Peru&(2009) +South&Africa&(2010) +Uruguay&(2009) +
Health
Source:Lus2g(2015a)
51HigginsandLus2g(2015)
FiscalImpoverishment($1.25ppp2005,frommarkettoconsumableincome)
52
MarketIncomeHeadcou
nt
changein
poverty
MarketIncomeGini
Reynolds-
Smolensky
changein
inequality
FIheadcount(amongwhole
popula5on)
FIheadcountamongpostfiscpoor
FIperimpoverisedas
prop'nofincome
Porvertywentup
ordown?
Unambiguouslyprogressive?
Inequalitywentupordown?
Brazil 0.066 -0.022 0.575 0.045 -0.035 0.007 0.160 0.088DOWN YES DOWNEthiopia 0.319 0.023 0.322 0.023 -0.020 0.729 0.832 0.054UP YES DOWNGhana 0.060 0.007 0.437 0.016 -0.014 0.051 0.766 0.053UP YES DOWNIndonesia 0.120 -0.015 0.398 0.011 -0.008 0.041 0.392 0.037DOWN YES DOWNMexico 0.049 -0.016 0.544 0.038 -0.025 0.008 0.237 0.148DOWN YES DOWNPeru 0.044 -0.007 0.459 0.009 -0.008 0.008 0.218 0.185DOWN YES DOWNSouthAfrica 0.370 -0.158 0.771 0.083 -0.077 0.059 0.088 0.274DOWN YES DOWNTanzania 0.437 0.079 0.382 0.041 -0.038 0.509 0.986 0.085UP YES DOWN
FiscalImpoverishment($1.25ppp2005,frommarkettofinalincome)
53
MarketIncomeHeadcou
nt
changein
poverty
Marketincome
+pensionsGini
Reynolds-
Smolensky
changein
inequality
FIheadcou
nt(amongwholepopula5
on)
FIheadcou
ntamongpostfiscpoor
FIperimpoverisedas
prop'nofincome
Porvertywentupordown?
Unambiguouslyprogressive?
Inequalitywentupordown?
Ethiopia 0.319 -0.020 0.322 0.031 -0.023 0.445 0.403 0.037DOWN YES DOWN
Ghana 0.060 -0.030 0.437 0.045 -0.035 0.010 0.333 0.055DOWN YES DOWN
Tanzania 0.437 -0.019 0.382 0.063 -0.051 0.175 0.418 0.064DOWN YES DOWN
POLICYSIMULATIONS:GHANAANDTANZANIA
Basedon:• Younger,Stephen,EricOsei-Assibey,andFelixOppong.2015.Fiscal
IncidenceinGhana.CEQWorkingPaperNo.35,CenterforInter-AmericanPolicyandResearchandDepartmentofEconomics,TulaneUniversityandInter-AmericanDialogue,December.[Innon-pecuniarycollabora5onwithWorldBank]
• Younger,Stephen,FloraMyamba,andKennethMdadila.2016.FiscalIncidenceinTanzania.CEQWorkingPaperNo.36,CenterforInter-AmericanPolicyandResearchandDepartmentofEconomics,TulaneUniversityandInter-AmericanDialogue,Forthcoming.
Ghana:Simula5onResultsforElimina5ngElectricitySubsidies
55
Ghana:Simula5onResultsforElimina5ngFuelSubsidies
56
Tanzania:Simula5onResultsforElimina5ngElectricitySubsidies
57
Tanzania:SimulatedEffectsofIncreasingCCTCoverage
58
TermsofEngagementPARTNERSHIPS&COLLABORATION
CEQAssessments&WorldBank• FiscalincidenceanalysisinPovertyAssessments,PERs,SCD,andso
onallowtheBanktoassesshowmuchthefiscalsysteminspecificcountriesishelpingachieveitstwingoals,andiden2fyareasforpolicyac2onthatcouldenhancethepoten2aloffiscalpolicyasaninstrumenttoachievetheequitygoals.– Forexample,ifbasicgoodsareheavilytaxed,wecanan2cipatethat
thepoorandthebosom40percentmightgethurtinanontrivialway.• Inthecontextoflendingprogramsthatinvolveausteritymeasures
orreformstothetaxand/ortransferssystems,fiscalincidenceanalysiscouldhelpminimizethenega2veeffectsonthepoorandthebosom40percent.– HowdoestheWBaddressthischallengecurrentlyintheabsenceof
fiscalincidenceresults?– FiscalincidenceanalysiscouldhelptheWBopera2onalizetheshared
prosperitytalk
60
CEQIcanoffer:Collabora5veEffortsinResearch&
Development(CEQHandbook2020)
Ø Educa2onandhealthbenefitsØ Incorpora2ngtopincomesØ Gender-sensi2veincidenceanalysisØ CorporateandcapitalincometaxesØ BehavioralresponsesØ Policysimula2ontools
61
Inexchange,thepartneringGovernment,Mul5lateralOrganiza5onorResearcherwould:
• Supplytheadministra2vedata(unlessspecifiedotherwise).
• PermissiontoincluderesultsinCEQI'sDataCenteraierallclearancesatpartnerorganiza2onhavebeencompleted.
• Permissiontociteresultsinpaperswithappropriatecita2onoforiginalauthorsandacknowledgmentofpartnerorganiza2on.
• Acknowledgethecontribu2onoftheCEQIfollowingagreeduponprotocol/s.
62
COUNTRYTEAMS&REFERENCES
Teamsandreferencesbycountry:
(inparenthesis:surveyyear;C=consump5on&I=income)
1. Bolivia(2009;I):PazArauco,Verónica,GeorgeGrayMolina,WilsonJiménezPozo,andErnestoYáñezAguilar.2014.“ExplainingLowRedistribu2veImpactinBolivia.”InLus2g,Nora,CarolaPessinoandJohnScos.2014.Editors.TheRedistribu4veImpactofTaxesandSocialSpendinginLa4nAmerica.SpecialIssue.PublicFinanceReview,May,Volume42,Issue3.(September22,2014)
2. Brazil(2009;I):Higgins,SeanandClaudineyPereira.2014.“TheEffectsofBrazil’sTaxa2onandSocialSpendingontheDistribu2onofHouseholdIncome.”InLus2g,Nora,CarolaPessinoandJohnScos.2014.Editors.TheRedistribu4veImpactofTaxesandSocialSpendinginLa4nAmerica.SpecialIssue.PublicFinanceReview,May,Volume42,Issue3.(November4,2014)
3. Chile(2009,I):Ruiz-Tagle,JaimeandDanteContreras.2014.CEQMasterworkbook,TulaneUniversity(August27,2014)
4. Colombia(2010,I):Melendez,MarcelaandNoraLus2g.2014.CEQMasterworkbook,TulaneUniversity(November21,2014)
5. CostaRica(2010;I):Sauma,JuanandDiegoTrejos.2014.SocialPublicSpending,Taxes,Redistribu4onofIncome,andPovertyinCosta.CEQWorkingPaperNo.18,CenterforInter-AmericanPolicyandResearchandDepartmentofEconomics,TulaneUniversityandInter-AmericanDialogue,January.(February2014)
64
7. Ecuador:LlerenaPinto,FreddyPaul,MaríaChris2naLlerenaPinto,RobertoCarlosSaáDaza,andMaríaAndreaLlerenaPinto.2015.SocialSpending,TaxesandIncomeRedistribu4oninEcuador.CEQWorkingPaperNo.28,CenterforInter-AmericanPolicyandResearchandDepartmentofEconomics,TulaneUniversityandInter-AmericanDialogue,February.
8. ElSalvador(2011;I):Beneke,Margarita,NoraLus2gyJoséAndrésOliva.2015.ElimpactodelosimpuestosyelgastosocialenladesigualdadylapobrezaenElSalvador.CEQWorkingPaperNo.26,CenterforInter-AmericanPolicyandResearchandDepartmentofEconomics,TulaneUniversityandInter-AmericanDialogue,February.(March11,2014)
9. Guatemala(2011;I):Cabrera,Maynor,NoraLus2gandHilcíasMorán.2014.FiscalPolicy,InequalityandtheEthnicDivideinGuatemala.CEQWorkingPaperNo.20,CenterforInter-AmericanPolicyandResearchandDepartmentofEconomics,TulaneUniversityandInter-AmericanDialogue,October.(April13,2014)
10. Indonesia(2012;C):Avar,Rythia,JonJellemaandMashewWai-Poi.2014.CEQMasterWorkbook,TulaneUniversityandTheWorldBank(February18,2014)
11. Mexico(2010;I):Scos,John.2014.“Redistribu2veImpactandEfficiencyofMexico’sFiscalSystem.”InLus2g,Nora,CarolaPessinoandJohnScos.2014.Editors.TheRedistribu4veImpactofTaxesandSocialSpendinginLa4nAmerica.SpecialIssue.PublicFinanceReview,May,Volume42,Issue3.(September2013)
65
13. Peru(2009;I):Jaramillo,Miguel.2014.“TheIncidenceofSocialSpendingandTaxesinPeru.”InLus2g,Nora,CarolaPessinoandJohnScos.2014.Editors.TheRedistribu4veImpactofTaxesandSocialSpendinginLa4nAmerica.SpecialIssue.PublicFinanceReview,May,Volume42,Issue3.(May1,2013)
14. SouthAfrica(2010;I):Inchauste,Gabriela,NoraLus2g,MashekwaMaboshe,CatrionaPurfieldandIngridWollard.2015.TheDistribu4onalImpactofFiscalPolicyinSouthAfrica.PolicyResearchWorkingPaper7194,TheWorldBank,February.(May5,2014)
15. UnitedStates(2011;I):Higgins,Sean,NoraLus2g,WhitneyRubleandTimothySmeeding(forthcoming)ComparingtheIncidenceofTaxesandSocialSpendinginBrazilandtheUnitedStates,ReviewofIncomeandWealth
16. Uruguay(2009;I):Bucheli,Marisa,NoraLus2g,MáximoRossi,andFlorenciaAmábile.2014.“SocialSpending,TaxesandIncomeRedistribu2oninUruguay.”InLus2g,Nora,CarolaPessinoandJohnScos.2014.Editors.TheRedistribu4veImpactofTaxesandSocialSpendinginLa4nAmerica.SpecialIssue.PublicFinanceReview,May,Volume42,Issue3.(August18,2014)
66
HouseholdSurveysUsedinCountryStudies
1. Armenia:IntegratedLivingCondi2onsSurvey,2011(I)2. Bolivia:EncuestadeHogares,2009(I)3. Brazil:PesquisadeOrçamentosFamiliares,2009(I)4. Chile:EncuestadeCaracterizaciónSocial(CASEN),2009(I)5. Colombia:EncuestadeCalidaddeVida,2010(I)6. CostaRica:EncuestaNacionaldeHogares,2010(I)7. Ecuador:EncuestaNacionaldeIngresosyGastosdelosHogaresUrbanoyRural,2011-2012(I)8. ElSalvador:EncuestaDeHogaresDePropositosMul2ples,2011(I)9. Ethiopia:EthiopiaHouseholdConsump2onExpeditureSurveyandEthiopiaWelfareMonitoringsurvey,2011
(C)10. Guatemala:EncuestaNacionaldeIngresosyGastosFamiliares,2010(I)11. Indonesia:SurveiSosial-EkonomiNasional,2012(C)12. Mexico:EncuestaNacionaldeIngresoyGastodelosHogares,2010(I)13. Peru:EncuestaNacionaldeHogares,2009(I)14. SouthAfrica:IncomeandExpenditureSurveyandNa2onalIncomeDynamicsStudy,2010-2011(I)15. Uruguay:EncuestaCon2nuadeHogares,2009(I)
Note:Thelesers"I"and"C"indicatethatthestudyusedincomeorconsump2ondata,respec2vely.67
References• Avar,R.,Jellema,J.,Wai-Poi,M.,forthcoming.“TheDistribu2onalImpactofFiscalPolicyin
Indonesia,”in:Inchauste,GabrielaandNoraLus2g(Eds.),TheDistribu2onalImpactofFiscalPolicy:ExperiencefromDevelopingCountries.WorldBank,Washington,D.C
• Aristy-Escuder,Jaime,MaynorCabrera,andMiguelEduardoSánchez-Mar}n(forthcoming)“Ananalysisoffiscalpolicyandincomeredistribu2onintheDominicanRepublic.”CEQWorkingPaperNo.37,CenterforInter-AmericanPolicyandResearchandDepartmentofEconomics,TulaneUniversityandInter-AmericanDialogue
• Beneke,Margarita,NoraLus2gyJoséAndrésOliva.2015.ElimpactodelosimpuestosyelgastosocialenladesigualdadylapobrezaenElSalvador.CEQWorkingPaperNo.26,CenterforInter-AmericanPolicyandResearchandDepartmentofEconomics,TulaneUniversityandInter-AmericanDialogue,February.
• Bucheli,Marisa,NoraLus2g,MáximoRossi,andFlorenciaAmábile.2014.“SocialSpending,TaxesandIncomeRedistribu2oninUruguay.”InLus2g,Nora,CarolaPessinoandJohnScos.2014.Editors.TheRedistribu4veImpactofTaxesandSocialSpendinginLa4nAmerica.SpecialIssue.PublicFinanceReview,May,Volume42,Issue3.
• Cabrera,Maynor,NoraLus2gandHilcíasMorán.2014.FiscalPolicy,InequalityandtheEthnicDivideinGuatemala.CEQWorkingPaperNo.20,CenterforInter-AmericanPolicyandResearchandDepartmentofEconomics,TulaneUniversityandInter-AmericanDialogue,October.(April13,2014)
• Duclos,Jean-YvesandAbdelkrimAraar.2007.PovertyandEquity:Measurement,PolicyandEs4ma4onwithDAD(Vol.2).Springer.Chapters7and8.(availableonline)
• Higgins,SeanandNoraLus2g.2015.Canapoverty-reducingandprogressivetaxandtransfersystemhurtthepoor?ECINEQWorkingPaperNo.363,April.
68
References• Higgins,SeanandClaudineyPereira.2014.“TheEffectsofBrazil’sTaxa2onandSocial
SpendingontheDistribu2onofHouseholdIncome.”InLus2g,Nora,CarolaPessinoandJohnScos.2014.Editors.TheRedistribu4veImpactofTaxesandSocialSpendinginLa4nAmerica.SpecialIssue.PublicFinanceReview,May,Volume42,Issue3.
• Higgins,Sean,NoraLus2g,WhitneyRubleandTimothySmeeding(forthcoming)ComparingtheIncidenceofTaxesandSocialSpendinginBrazilandtheUnitedStates,ReviewofIncomeandWealth.
• Inchauste,Gabriela,NoraLus2g,MashekwaMaboshe,CatrionaPurfieldandIngridWollard.forthcoming.“TheDistribu2onalImpactofFiscalPolicyinSouthAfrica,”in:Inchauste,G.,Lus2g,N.(Eds.),TheDistribu2onalImpactofFiscalPolicy:ExperiencefromDevelopingCountries.WorldBank,Washington,D.C
• Jaramillo,Miguel.2014.“TheIncidenceofSocialSpendingandTaxesinPeru.”InLus2g,Nora,CarolaPessinoandJohnScos.2014.Editors.TheRedistribu4veImpactofTaxesandSocialSpendinginLa4nAmerica.SpecialIssue.PublicFinanceReview,May,Volume42,Issue3.
• Lambert,PeterJ.(2001).TheDistribu4onandRedistribu4onofIncome:AMathema4calAnalysis.ManchesterUniversityPress.ThirdEdi2on.Chapter11.(notavailableonline)
• Lindert,Peter(2004).GrowingPublic,CambridgeUniversityPress.• LlerenaPinto,FreddyPaul,MaríaChris2naLlerenaPinto,RobertoCarlosSaáDaza,andMaría
AndreaLlerenaPinto.2015.SocialSpending,TaxesandIncomeRedistribu4oninEcuador.CEQWorkingPaperNo.28,CenterforInter-AmericanPolicyandResearchandDepartmentofEconomics,TulaneUniversityandInter-AmericanDialogue,February.
69
References
• Lopez-Calva,LuisF.,NoraLus2g,MikhailMatytsinandDariaPopova(forthcoming)“WhoBenefitsfromFiscalRedistribu2oninRussia?”in:Inchauste,GabrielaandNoraLus2g(Eds.),TheDistribu2onalImpactofFiscalPolicy:ExperiencefromDevelopingCountries.WorldBank,Washington,D.C
• Lus2g,Nora,AliEnamiandRodrigoAranda.“TheAnaly2csofFiscalRedistribu2on.”ChapterinLus2g,Nora,editor,CommitmenttoEquityHandbook:Es2ma2ngtheRedistribu2veImpactofFiscalPolicy.,TulaneUniversityandtheWorldBank(Forthcoming)
§ Lus2g,Nora.2015a.“TheRedistribu2veImpactofGovernmentSpendingonEduca2onandHealth:Evidencefrom13DevelopingCountriesintheCommitmenttoEquityProject”Chapter17inGupta,Sanjeev,MichaelKeen,BenedictClementsandRuuddeMooij,editors,InequalityandFiscalPolicy,Washington:Interna2onalMonetaryFund.
§ Lus2g,Nora.2015b.Lus2g,Nora.2015b.InequalityandFiscalRedistribu4oninMiddleIncomeCountries:Brazil,Chile,Colombia,Indonesia,Mexico,PeruandSouthAfrica.EvidencefromtheCommitmenttoEquityProject(CEQ).CEQWorkingPaperNo.31,CenterforInter-AmericanPolicyandResearchandDepartmentofEconomics,TulaneUniversityandInter-AmericanDialogue.
§ Lus2g,Nora,editor.2016.CommitmenttoEquityHandbook:Es2ma2ngtheRedistribu2veImpactofFiscalPolicy.(Forthcoming)
• Melendez,Marcela.2014.CEQMasterworkbook,TulaneUniversity(November21,2014)
70
References
• PazArauco,Verónica,GeorgeGrayMolina,WilsonJiménezPozo,andErnestoYáñezAguilar.2014.“ExplainingLowRedistribu2veImpactinBolivia.”InLus2g,Nora,CarolaPessinoandJohnScos.2014.Editors.TheRedistribu4veImpactofTaxesandSocialSpendinginLa4nAmerica.SpecialIssue.PublicFinanceReview,May,Volume42,Issue3.(September22,2014)
• Ruiz-Tagle,JaimeandDanteContreras.2014.CEQMasterworkbook,TulaneUniversity(August27,2014)
• Sauma,JuanandDiegoTrejos.2014.SocialPublicSpending,Taxes,Redistribu4onofIncome,andPovertyinCosta.CEQWorkingPaperNo.18,CenterforInter-AmericanPolicyandResearchandDepartmentofEconomics,TulaneUniversityandInter-AmericanDialogue,January.
• Scos,John.2014.“Redistribu2veImpactandEfficiencyofMexico’sFiscalSystem.”InLus2g,Nora,CarolaPessinoandJohnScos.2014.Editors.TheRedistribu4veImpactofTaxesandSocialSpendinginLa4nAmerica.SpecialIssue.PublicFinanceReview,May,Volume42,Issue3.
• Shimeles,Abebe,AhmedMoummi,NizarJouiniandNoraLus2g(forthcoming)“FiscalIncidenceandPovertyReduc2on:EvidencefromTunisia,”CEQWorkingPaperNo.38,CenterforInter-AmericanPolicyandResearchandDepartmentofEconomics,TulaneUniversityandInter-AmericanDialogue.
• WorldBank.2014.Ethiopia.PovertyAssessment,Chapter5.(BasedonCEQAssessmentforEthiopia)
71
References• Younger,Stephen,EricOsei-Assibey,andFelixOppong.2015.FiscalIncidenceinGhana.CEQ
WorkingPaperNo.35,CenterforInter-AmericanPolicyandResearchandDepartmentofEconomics,TulaneUniversityandInter-AmericanDialogue,December.
• Younger,Stephen,FloraMyamba,andKennethMdadila.2016.FiscalIncidenceinTanzania.CEQWorkingPaperNo.36,CenterforInter-AmericanPolicyandResearchandDepartmentofEconomics,TulaneUniversityandInter-AmericanDialogue,Forthcoming.
• YoungerStephenandArtsviKhachatryan(forthcoming)“FiscalIncidenceinArmenia,”in:Inchauste,GabrielaandNoraLus2g(Eds.),TheDistribu2onalImpactofFiscalPolicy:ExperiencefromDevelopingCountries.WorldBank,Washington,D.C
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Thankyou!
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