Affordable housing in Pakistan

This paper demonstrates how the design of standards, pricing and finance must be integrated if affordable housing is to be achieved in a sustainable and replicable way. The paper does this by identifying basic principles in achieving affordability and applying these principles through a simple, computer-based integrated-design model to a ‘model’ housing project in Pakistan. In most instances, where there is not a development grant or forgivable loan, affordability must be combined with cost-recovery if projects are to be sustainable and replicable. Keys to such projects are the use of market prices, incremental construction using sweat equity, efficient and affordable standards, differential pricing, and financing using market interest rates but with affordable down payments and repayment rates. The paper demonstrates that the ‘model’ project in Pakistan, as designed, is not affordable. Through examining several alternative designs using different land-use standards, pricing and financing systems, the paper shows what needs to be done to make such projects affordable. In doing so, it illustrates how affordability, standards, pricing, finance, and cost-recovery can be integrated in the design process. While applied to Pakistan, the relevance to Canada of this integrated-interactive design process is explored.     

Measuring social capital accumulation in rural development

Using a theoretical framework, the study proposes an index that can measure the social capital of local action group (LAG) projects. The index is founded on four indicators: number of ties, bridging social capital, recognition, and diversity, which are aggregated into one social capital index. The index has been tested in LAG-Djursland, Denmark, and the study further investigates whether the organisational affiliation, project financing, and LAG co-financing can explain the degree of social capital accumulation. Furthermore, the author has tested if there are connections between motivation for pursuing development projects similar to those implemented previously and the degree of social capital. The paper concludes that there are indications that projects hosted by municipalities tend to show the most social capital, there is no connection between the amount of project financing and social capital, and a high level of motivation leads to increased social capital.     

市政债券匹配城镇化建设资金需求的理论分析

城镇基础设施和公共服务等社会公共品理应由地方政府提供,地方政府需要为此筹措长期建设资金。市政债券与城镇化建设相关投资相契合,在城镇化建设融资中具有良好的适应能力,能够在融资安排和风险防范上有所作为,在城镇化发展过程中担当融资主体。并且市政债券能很好地匹配、适应和耦合城镇基础设施建设资金需求的特点,避免其他融资方式或融资工具可能存在的期限错配。市政债券是适合城镇化建设融资、有助于建立多元化的城镇化建设融资体系与可持续的城镇化建设融资机制,从而积极稳妥地推进城镇化的有效融资工具。     

Financing of Urban Services in India: A Case for Appropriate Pricing and Cost Recovery

The paper makes an attempt to examine financing of urban services within the broader macro-economic liberalisation and decentralisation context in India. It estimates the resource gap between the present flow of funds and financial requirements for urban civic services on the basis of the existing un-met demand and projected population growth trends. While making a case for appropriate pricing and cost recovery for generating more resources for financing urban services, the paper focuses on the changing attitude towards full-cost recovery, existing practices of pricing and cost recovery of urban services, provides empirical evidence of poor cost recovery from four Indian cities and identifies key institutional, conceptual and managerial issues that need to be addressed. Finally, the paper presents the emerging directions for policy reforms and action for meeting the growing needs for urban infrastructure and services, which includes some measures for fiscal reforms to increase the flow of finances for urban infrastructure and services, strengthening the resource base of local agencies and capacity building of local agencies.     

A comparison of pricing rules for auctions and fair division games

Consider an auction or fair division game where every bidder knows his true value of the single object but is only incompletely informed about the true values of his competitors. By imposing the axiom of envy freeness with respect to stated preferences the set of pricing rules is restricted to the prices between the highest and second highest bid. Whereas for auctions one also can satisfy incentive compatibility, the same is not true for fair division games. We analyse and compare the different pricing rules, partly incentive compatible and partly not, by deriving the optimal bidding strategies. By comparing the payoff expectations induced by the various pricing rules we can prove directly a special equivalence statement saying that expected payoffs do not depend on the pricing rule. It is interesting that in fair division games equivalence of pricing rules is only valid if information is sufficiently incomplete.The authors gratefully acknowledge the helpful comments of an anonymous referee     

伊斯兰文化的金融约束与微型金融发展

本文利用文化维度理论,剖析了伊斯兰地区的人文特征,深入研究了伊斯兰文化的金融约束及当地微型金融服务的现实需求与人文嵌入方式。伊斯兰文化具有权利差距小、不确定性规避强、集体主义、阴柔气质以及长期取向等五大特征;伊斯兰文化对微型金融服务具有强力的约束效应,不但反对高利贷和利率,而且强调借贷双方的道德准则;伊斯兰微型金融服务通过成本加融资、利润共享及慈善贷款三种方式融入伊斯兰社区,因展现出形式灵活、运作高效等优越性而普受欢迎;微型金融服务与社区人文环境的有效交融是伊斯兰微型金融取得成功的关键之处。     

Incentive Structures Within Mental Health Financing Strategies

Abstract

This paper analyzes the incentive structure contained in traditional fee-for-service and capitated managed care models and finds both to be inadequate in encouraging the attainment of client outcomes. An incentive financing scheme is proposed that links funding to outcomes, and describes the necessary elements of such a system. This framework is then applied to the New Hampshire and Colorado incentive financing systems.     

A DIRECT TEST OF THE EFFICIENT MARRIAGE MARKET HYPOTHESIS

This paper takes Becker's efficient marriage market hypothesis at face value, and directly confronts it with data from Hong Kong. The theory of optimal assignment is used to develop an empirical model of spouse selection, which resembles a Tobit model. This model can address positive or negative assortative matching as well as marginal product pricing in marriage markets. We also use a computer algorithm to solve the assignment problem for imputed marital output. The degree to which the actual pairing of husbands and wives corresponds to the optimal pairing provides a goodness-of-fit test of the efficient marriage market hypothesis. ( JEL C51, C61, C78, J12)     

Infrastructure Privatisation: Oversold,Misunderstood and Inappropriate

Infrastructure privatisation aimed to finance capital investment and improve efficiency, but the results have been disappointing because of the mismatch between privatisation theory and the characteristics of infrastructure and utility projects in developing countries. This article reviews the evidence and seeks to explain the results in terms of the high capital costs and low revenues that have necessitated public financing and risk‐sharing, diluting private incentives and requiring regulation. However, it argues that the emphasis on strengthening weak regulatory capacities in poor countries is misplaced, because these are the outcome of the development process, and are constrained by technical capacities, informational problems and the resources available. In this context, infrastructure privatisation is argued to be inappropriate for developing countries.     

An auction theoretical approach to fiscal wars

I examine a situation where a firm chooses to locate a new factory in one of several jurisdictions. The value of the factory may differ among jurisdictions and it depends on the private information held by each jurisdiction. Jurisdictions compete for the location of the new factory. This competition may take the form of expenditures already incurred on infrastructure, commitments to spend on infrastructure, tax incentives or even cash payments. The model combines two elements that are usually considered separately; competition is desirable because we want the factory to be located in the jurisdiction that values it the most, but competition in itself is wasteful. I show that the expected total amount paid to the firm under a large family of arrangements is the same. Moreover, I show that the ex-ante optimal mechanism – that is, the mechanism that guarantees that the firm chooses the jurisdiction with the highest value for the factory, minimizes the total expected payment to the firm, and balances the budget in an ex-ante sense – can be implemented by running a standard auction and subsidizing participation. Received: 6 December 2000/Accepted: 18 February 2002 I gratefully acknowledge the financial support of CNPQ (Grant no. 300065/93-0) and ARC (Grant no. A000000055). The author is grateful to the editor and an anonymous referee for many helpful comments.     

A formal theory approach to lawsuits and corporate deviant behavior: building a more efficient system

This paper discusses the problems in the efficient implementation of tort reform. Current, and many proposed reforms, fail to provide a Pareto optimal solution. The problems with current policies lie in the fact that they only alter the incentive structures of one actor in the tort system. A truly efficient system needs to alter incentive structures for both potential litigants and potential defendants. Using economic modeling, the paper argues that efficient tort reform can be achieved by utilizing decoupled tax incentives.     

Critical indicators for assessing the contribution of infrastructure projects to coordinated urban-rural development in China

It is widely recognized that the coordinated development between urban and rural areas can not only narrow gaps in infrastructure between urban and rural areas, promote balanced development in rural areas in terms of society, economy and environment, but is also an effective way to address issues facing agriculture, rural areas and farmers. In line with this, development of infrastructure projects has been an important means for promoting coordinated urban-rural development in developing countries (such as China). However, there is a lack of indicators that can be used to assess the contribution of infrastructure projects to coordinated urban-rural development. This paper thus attempts to present a set of critical indicators for evaluating the contribution of infrastructure projects to coordinated urban-rural development in the particular context of Chongqing, Western China.First, a list of optional indicators that are with potential for assessing the contribution of infrastructure projects to coordinated urban-rural development is presented based on examination on related project feasibility reports, official reports and literature. Then 42 indicators are identified from the optional list through a questionnaire survey. By using the data collected, the relative level of significance of each indicator is derived. Finally, an indicator system consisting of 19 critical indicators is established based on results of principle component analysis. The applicability and significance of the identified indicators for assessing the contribution of infrastructure projects to coordinated urban-rural development are discussed as well.     

政府向社会组织购买公共服务的问题与对策分析

政府向社会组织购买公共服务是我国公共服务制度的重要创新,对节约政府开支,提高公共服务效果有着重要意义。这种做法正在探索之中,购买程序、购买内容、定价、资金来源、评估机制等都存在着问题,需从两大方面探求解决途径,即政府应加大培养社会组织的力度,从法律法规层面上健全制度设计。     

城镇化过程中投融资问题研究——基于公共服务的视角

由于现有的公共服务存在着种种不足,我国城镇化发展速度受到一定的制约。通过投融资体制机制的创新来促进公共服务的有效供给,一方面能够显著加快我国新型城镇化的进程,另一方面也能有效提高城镇化的质量。构建与新型城镇化相适应的投融资机制,应满足可持续性和多样性的原则,从多渠道为公共服务的供给筹集资金;增强地方财政在城镇化进程中的自我发展能力,建立稳定的筹资机制;建立政府、企业和个人共同投资的多元化投融资机制,通过市场机制为城镇化建设融资拓宽渠道;引导和支持民间资本进入基础产业、基础设施建设、市政公用事业、社会事业、金融服务等领域,创造良好的投资环境,推进公共服务和公共产品提供方式的社会化和市场化。     

Conflict or consensus: An investigation of stakeholder concerns during the participation process of major infrastructure and construction projects in Hong Kong

Public participation in the planning and design of major public infrastructure and construction (PIC) projects is crucial to their success, as the interests of different stakeholders can be systematically captured and built into the finalised scheme. However, public participation may not always yield a mutually acceptable solution, especially when the interests of stakeholders are diverse and conflicting. Confrontations and disputes can arise unless the concerns or needs of the community are carefully analysed and addressed. The aim of the paper is to propose a systematic method of analysing stakeholder concerns relating to PIC projects by examining the degree of consensus and/or conflict involved. The results of a questionnaire survey and a series of interviews with different entities are provided, which indicate the existence of a significant divergence of views among stakeholder groups and that conflicts arise when there is a mismatch between peoples’ perception concerning money and happiness on the one hand and development and damages on the other. Policy and decision-makers should strive to resolve at least the majority of conflicts that arise throughout the lifecycle of major PIC projects so as to maximise their chance of success.     

PPP Financing in the Road Sector: A Disequilibrium Analysis Based on the Monetary Circuit

This paper discusses public and private financing of infrastructure against the background of monetary equilibria, where money is not neutral and financing has an impact on allocation through distribution. These correspond to “disequilibrium positions” in the neoclassical barter equilibrium, as they violate some of its optimality conditions. In these contexts, evaluating welfare before and after the realisation of a project implies a comparison between two suboptimal positions. Such a comparison reveals that, contrary to a widely held view, there are not many rational arguments that may lead to prefer private financing to public financing of road infrastructure, particularly where local incomes are low. Post Keynesian analysis in general and its monetary variant of the circuit, are useful tools for the analysis of public investment policies in such a disequilibrium context. In particular, some features of the monetary circuit approach are well suited to address the economic problems raised by the analysis of public private partnerships (PPP), notably: (a) the integration of the banking sector and the recognition of its role in monetary creation by the private sector; (b) the monetary creation by the State within a macroeconomic framework fully integrating public finance; and, (c) the necessary link between uncertainty and disequilibrium. Combined with a partial equilibrium analysis based on realistic microeconomic configurations of costs and transport demand parameters, the analysis of the circuit highlights that PPP in the road sector do not add anything to the level of effective demand, being in fact the other flip of the coin of restrictive budgetary policies. PPP play a role in mobilizing part of the accumulated savings that the State is forbidden to attract directly because of debt ceilings. They have a softening effect on the Government budgetary constraints similar to those that could be reached if the Government was allowed to accrue investment like the private sector, but are a less transparent solution, because the relevant debt is not necessarily recognized in the balance sheet that services it.     

“Site Fights”: Explaining Opposition to Pipeline Projects in the Developing World1

Fifty years ago, the main challenges to large infrastructure projects were technical or scientific. Today, the greatest hurdles faced by such projects are almost always social and/or political. Whether constructing large dams in the developing world or siting liquefied natural gas terminals in the United States, the onset of these projects often triggers intense popular opposition. But not always, and therein lays the animating aim of this project. We undertake a systematic comparative case analysis of mobilization efforts against 11 oil and gas pipeline projects spanning 16 countries in the developing world. Using theories from the social movement and facility siting literatures and the technique of fuzzy set/qualitative comparative analysis (fs/QCA), we examine the “causal conditions” linked to political and legal opposition to these projects. We find that both Western funding of projects and public consultation serve as necessary political opportunities encouraging mobilization. In addition, not compensating the host country for involvement in the project is linked to mobilization. Finally, some risk from the project, in the form of environmental or social impact, is associated with mobilization; however, this impact does not have to be very significant for mobilization to occur.     

Fully-Revealing Equilibria of Multiple-Sender Signaling and Screening Models

Models of incomplete information have played a major role in the fields of political science and political economy. The models have almost exclusively been signaling models, and their substantive focus is frequently on situations in which the extensive form is not dictated by institutional requirements or procedures. We explore the relation between multiple-sender signaling games and the corresponding screening or mechanism design games without transfers and establish an equivalence result. If there is a fully-revealing equilibrium in the signaling game there is also a full-information optimal mechanism that yields the principal’s optimal policy in every state. The converse, that fully-revealing equilibria exist in the signaling game if a full-information optimal mechanism exists, is true if and only if the mechanism involves only the selection of policies that are optimal for some belief about the state. We also present two straightforward sufficient conditions for the existence of full-information optimal mechanisms. When either holds, fully-revealing equilibria in the signaling and screening games exist. The perceived advantage of the signaling over the screening approach – that no commitment by the principal is assumed – may be over-stated as flexibility in specifying off the path beliefs can mimic commitment.     

Beyond "banking for the poor": credit mechanisms and women's empowerment

This article describes some strengths and limitations of credit programs for women in developing countries. It is urged that development planners recognize the importance of the selection of the type of credit mechanism in the long term. Ethical issues should be decided upon before the credit mechanism is operable. Organizations should make clear what level of commitment there is to empower borrowers. Most organizations give loans to women and assume empowerment will take place without devising strategies to ensure empowerment. Credit mechanisms include credit for the poor and credit by the poor. A sound financial portfolio and 100% repayment are not the appropriate criteria for securing the empowerment of women. Empowerment of women is related to "building the capacity of borrowers to manage and control decision making." UNICEF's framework of gender equality and women's empowerment identifies levels of empowerment as "welfare, access, conscientisation, participation, and control." Development planners should be aware that provision of credit also has the potential to increase a poor family's debt. Delinquency may be hidden by overlapping loans that trap borrowers. Fewer installment payments increase the chances of a debt trap. Reducing the number of installments may reduce administrative costs and conform to production processes, but may also lead to a debt trap. There is now considerable emphasis on investing in low-income women entrepreneurs as a highly efficient means of achieving social and economic objectives. Credit programs aim to support the growth of small, self-sustaining businesses, to improve women's opportunities, and to provide alternatives to exploitation by local money-lenders. This article describes the following credit mechanisms: bank guarantee systems, government credit schemes, intermediary projects, direct lending projects, banks for the poor, credit unions, and village-based banks.