FISCAL STABILIZATION WITH PARTIAL EXCHANGE RATE PASS‐THROUGH

This article examines the role of fiscal stabilization policy in a two‐country framework that allows for partial exchange rate pass‐through. Analytical solutions for optimal monetary and fiscal policy rules depend on the degree of pass‐through. Each country unilaterally uses its fiscal instrument to stabilize the costs facing exporters. The welfare effects differ strongly depending on the degree of pass‐through. For high levels, both countries are better off with the fiscal instrument and welfare is closer to the benchmark flex‐price level. For low levels, however, the unilateral equilibrium policy rules lead to high volatility in taxes, and fiscal policy ends up being destabilizing by transmitting exchange rate fluctuations. Because these results stem from strategic considerations by the two countries, the fiscal instrument is not used under policy coordination. In addition, imposing a monetary union increases welfare when pass‐through is low, including the case of local currency pricing. (JEL E52, E63, F41, F42)     

Assessment of China’s Poor County Program

ABSTRACT

China made remarkable progress in rural poverty alleviation. A major policy instrument is the County Level Poverty Alleviation Program, which has vast policy support but is also criticized for targeting errors, misuse of funds, and making poverty both shameful and attractive. Whether this program, or the country’s economic growth in general, is the main force in poverty reduction is the question addressed in this article, analyzing data for the 592 poor counties. The response to the economic growth–policy alleviation conundrum is that a push for social wellbeing and empowerment is needed together with economic growth to achieve major poverty improvements.     

The Scope for Fiscal Policy: A Case Study of Thailand

This article is concerned with the application of fiscal policy instruments in stabilisation policy. Theoretical and practical considerations suggest that the scope for fiscal policy may be limited, but analysis of the actual performance of Thailand shows that an active use has been made of it. Compared with advanced economies, the role of automatic stabilisers is relatively small; discretionary fiscal policy interventions have been more important. Particularly in the years after the Asian financial crisis fiscal policy has been actively used, first, under IMF programmes, to reduce aggregate demand, and later to stimulate the economy. The article focuses on the application of fiscal policy instruments, not on the impact of fiscal policy interventions on the real economy.     

Power and Social Work: A Change in Direction

This article examines the elite model of conceptualizing poverty. The authors contend that elites frame the discussions about employment and poverty; consequently, they prevent any meaningful examination of the root causes of poverty and circumvent any proposals that shift the balance of power. The challenge for social work is that the elite model considers the profession as an agent responsible for executing social policy that supports the status quo. Thus, social workers have unwittingly become part of the problem.

The authors argue that the way to address this problem is to transform the profession of social work from within. Among the ways to create this transformation are to focus social work education on the function of politics; strengthen field education; promote action-based research; and integrate a global perspective into practice and policy initiatives.     

Urban poverty,economic restructuring and poverty reduction policy in urban China: Evidence from Shanghai, 1978–2008

This article uses the city of Shanghai as a case study to analyze the changing institutional mechanisms for the new urban poverty stratum in China. Specifically, the article examines urban poverty in relation to economic restructuring and the transformation of the welfare provision system in three stages of market reforms. The article first examines the overall economic growth strategies at the national level, and then examines local government policy outcomes at the city level. The impacts of institutional changes on urban poverty and social inequality are subsequently. Finally, the article assesses the current poverty reduction policies and proposes a “social inclusion” framework to alleviate urban poverty in China.     

Inequality and fiscal policies in Uruguay by race

The aim of this study is to analyze the effect of fiscal policy by race, disaggregating to consider Uruguayans with primarily European, African and indigenous ancestry. We perform an incidence analysis, an estimation of the effect of fiscal policy on the poverty exit rate and an assessment of the impact on the average ethno-racial gaps. The findings support the idea that fiscal policy reduces (but does not eliminate) ethnic gaps. This result is led by health care and educational transfers, and to a lesser degree by direct transfers. We do not consider quality issues with public services, which may affect the estimated narrowing of gaps. Finally, we find that Afro-descendants and indigenous individuals do not capture the full potential of education transfers because of their high drop-out rate.     

Poverty dynamics and disability: An empirical exercise using the European community household panel

In this article, we analyze the influence of being disabled on poverty dynamics. We present results adjusting the modified OECD equivalence scale by the number of adults with severe disabilities in the household and calculate poverty rates with this disability-adjusted scale. In addition we address the problem of incidental parameters in econometric models for the probability of being poor and separate the effects of being disabled on poverty that are short and long-term. The results show that the long-term (‘persistence’) effect is three times the short-term (‘true state dependence’) effect, which has significant social policy implications.     

Breaking down rural and urban bias and interrogating spatial inequality,evidence from South Africa

This article investigates current socioeconomic disparities within rural and urban areas. The empirical analysis is grounded in an examination of urban and rural bias theories, which have often underpinned poverty analysis. This article suggests that poverty analysis can be improved by moving beyond the rural–urban binary and investigating differences across all geographical types (when data are available). Using 2012 household survey data on South Africa, the article sheds lights on substantial differences—in household composition and access to services and assets—that are likely to make households located in particular geotypes far more vulnerable to poverty. Finally, the article discusses how development policy can better address the specific income‐generating constraints that disadvantaged areas face.     

Rural Women,Anti-Poverty Strategies,and Black Feminist Thought

Rural U.S. poverty rates have been persistently high. Market-based anti-poverty strategies, specifically microenterprise programs, have gained currency as a feasible avenue for moving women out of poverty. While rural women may share some commonality, homogeneity among rural women is often assumed in poverty scholarship. It is imperative that poverty scholars contribute to closing the gap between theoretical explanations and the actually experiences of poverty among individuals occupying different social locations. As researchers address this gap, this article argues for the value of integrating two important components consistent with black feminist epistemology: (1) an intersectionality perspective, and (2) the voices of the local actors/stakeholders. This article concludes that without a purposeful examination of individuals located at the intersection of race/ethnicity, gender, and/or class; even carefully formulated policy can inadvertently discriminate against or benefit some women more than others.     

增长、就业与社会支出——关于社会政策的“常识”与反“常识”

经济发展和社会政策的关系在学界和公共平台一直争论不休。主流观点认为,社会政策汲取的税收会扭曲市场激励机制,而且通过提供慷慨的保障弱化了劳动者的工作动机,进而对就业产生负面影响。此外,社会支出具有刚性,难以控制。本文回顾了国内外现有的理论和经验研究,分析了社会政策与经济发展、社会保护与就业的关系,以及社会支出是否可控三个议题,从而否定了社会政策是短视国策的看法。历经30多年高速增长的中国,财富与矛盾都在积聚,未来的发展和稳定不可能继续依赖海量的投资和不稳定的外部需求。通过系统化的社会保护体制建设,将社会保障视为一种投资而非纯粹的耗费,中国可望走向更具韧性和更为人性的稳定状态。     

Indian Country Poverty: Place‐Based Poverty on American Indian Territories, 2006–10

This article examines place‐based poverty in Indian Country, emphasizing that reservation characteristics are influenced by the system of federal Indian policy that affects American Indian self‐determination and antipoverty strategies within reservation boundaries. Using data from the American Community Survey five‐year file, 2006–10, I model poverty rates using multivariate, nested regression along key dimensions associated with American Indian antipoverty strategies and place‐based poverty. The results indicate that rates of female‐headed households and opportunity structures, such as lack of work, contribute to higher rates of reservation poverty while gaming acts as a slight buffer against poverty. Surprisingly, natural‐resource‐related occupations, thought to be associated with expropriation of tribal resources, was not associated with higher poverty, while self‐governance compacts, acting as a proxy for tribal autonomy, had no significant impact on poverty rates. As tribal governments seek to address poverty through strategies enabled by self‐determination policies, there is a critical need for more comprehensive and reliable data to understand how and whether tribal governments can effectively adapt federal policies to specific reservation conditions.     

稳增长、防风险、加快推进改革——当前中国经济形势分析与对策

当前,中国经济增长放慢是多种因素综合作用的结果,这些因素包括经济发展阶段变化、外部经济环境恶化、不可持续的经济增长方式等。为走出当前困境、实现经济转型,不宜再采取大规模的刺激政策而应保持货币和财政政策的平稳。通过保持宏观经济的稳定、维持经济的适度增长以赢得调整的时间;通过减少债务存量、阻止债务继续快速积累以防范金融风险;通过加大改革力度为经济和社会注入新的活力以推动经济转型。     

中国经济运行“新常态”解析

近3年,中国经济整体运行有以下特征：经济增速是中高速的,且有小幅波动,就业基本平衡,低水平通胀,出现局部性金融风险,管理部门出台了有限度的经济刺激政策.但目前,中国经济运行主要有以下风险：持续通缩,房地产投资增速回落,市场违约风险显性化,联保联贷的风险.要维持经济新的运行状态,货币政策应保持宽松的基调不变,但要使资金进入实体经济,财政政策可更积极一些,尤其是要关注小微企业.     

Pathways to poverty reduction

Of the myriad approaches to reducing poverty, which have proved effective on a national scale? This article analyses 15 systematically selected national cases of demonstrated rapid poverty reduction, seeking insights into effective approaches to reducing poverty. From these 15 economies, in which the bottom quintile experienced an annual increase in income of at least 6% over at least a decade, emerge four poverty‐reduction pathways: (1) industrialisation, (2) rural development, (3) social welfare and (4) petroleum‐generated employment. In addition to helping us understand what policy approaches have actually helped reduce poverty, this article has implications for the understanding of economic growth, the impact of pro‐growth policies, the relationship between state and market, and the roles of non‐government organisations (NGOs) and civil society.     

Economic Growth,Health and Poverty: An Exploratory Study for India

This article analyses the possible links between economic growth, poverty and health, using panel data for the Indian states. The findings indicate that, though growth tends to reduce poverty, significant improvements in health status are also necessary for poverty to decrease. Also, economic growth and health status are positively correlated and have a two‐way relationship, suggesting that better health enhances growth by improving productivity, and higher growth allows better human capital formation. Health expenditure is an important determinant of both higher growth and better health status, and is therefore a key tool available to policy‐makers. Among other exogenous variables, literacy and industrialisation seem to improve both health outcomes and growth, and to reduce poverty.     

Questioning the Pro‐Poor Agenda: Examining the Links between Social Protection and Poverty

This article investigates an empirical puzzle. Taking the case of Botswana, how is it that poverty is so high, when the country largely conforms to pro‐poor growth strategies? This article suggests that the minimal role of social‐security policies partly explains the relatively high poverty levels. This hypothesis is tested in a large‐N study of developing countries which shows that broad‐based and generous, rather than pro‐poor, social‐security policies impact strongly on poverty levels. The analysis further alludes to other obstacles to poverty reduction, such as economic transformation, which may be combined with a pro‐active social‐policy agenda. Thus, poverty‐alleviating strategies should be refocused to allow for a wider and more coherent role for social‐security policies.     

Commodity Price Volatility,Vulnerability and Development

This article examines the meaning and consequences of the developing countries’ vulnerability to the volatility of commodity prices. It first considers how to define and measure a country’s shocks and exposure arising from commodity price volatility in order to identify structural as distinct from policy vulnerability. The main channels through which price vulnerability influences economic growth are then presented. Finally, the policy implications for development aid, its allocation and design, are outlined. It is found that, while structural vulnerability is bad for growth, a policy of openness contributes to resilience. With the right rules, aid could play an important growth‐enhancing and poverty‐reducing role if allocated at least partly on the basis of vulnerability.     

THE STATE OF THE FEDERAL BUDGET AND THE STATE OF THE ECONOMY: FURTHER EVIDENCE

Simultaneous monetary and fiscal policy reaction functions are derived and estimated for the 1969:2–1984.3 period. The results suggest that the Reagan administration has abandoned fiscal policy as a stabilization tool. Furthermore, although the average money growth rate declined in the Reagan administration, variation in the rate of money growth indicates that monetary policy has been used to combat unemployment. Finally, monetary and fiscal policies were not coordinated during this period. Rather, monetary and fiscal policy appear to be set by a Nash equilibrium in a non-cooperative game. In a Nash equilibrium, the policy chosen by each authority maximizes its payoff, given the policy choice of the other authority.     

FISCAL RULES AND GOVERNMENT BORROWING COSTS: INTERNATIONAL EVIDENCE

We find that the adoption of numerical fiscal rules reduces government borrowing costs in a sample of 101 advanced and developing countries for 1985–2010. We apply a variety of propensity score matching methods to address the self‐selection problem of policy adoption and find strong evidence that fiscal rules have large and significant treatment effects on lowering government borrowing costs in both international and domestic financial markets. The results are robust to changes in country sample and alternative estimation methodology, and are consistent with fiscal rules helping to build policy credibility by reducing the probability of default and the “risk premium” on government debt that compensates lenders for this possibility. (JEL E43, G12, H60)     

Caring for Persons with Serious Mental Illness

Abstract

This article places evidenced-based knowledge of practice within the social context of care and proposes five policy objectives and specific policy and program changes to address care needs of people with serious mental illness. In spite of demonstration programs that provide the basis for proposed policy initiatives throughout the United States, treatment provision for this population remains inadequate and their safety and well-being continues to be at risk. The authors suggest that treatment initiatives need to be tied to stable policies protecting the mentally ill from adverse social context changes. The authors conclude that policies are needed that will enhance housing assistance, independent social functioning, personal empowerment, and treatment engagement. In addition, efforts are needed to make better use of inpatient hospital care, to better understand the role of assisted treatment, and to better develop consistent long-term fiscal support for the seriously mentally ill. They offer specific policy recommendations for changes in HUD programs, Medicaid and Medicare funding, and treatment programming that address these needs.