Skip Ribbon Commands
Skip to main content

JOBS AND DEVELOPMENT BLOG

Read. Comment. Debate.

Jobs and Development Blog - The Jobs Knowledge Platform > Posts > Friday Smorgasbord: Getting a Better Grasp of How Fiscal Policies Affect Poverty in Latin America
Friday Smorgasbord: Getting a Better Grasp of How Fiscal Policies Affect Poverty in Latin America
December 07, 2012 | Contribution by GLADYS LOPEZ-ACEVEDO

Gladys Lopez-Acevedo is a Senior Economist, Poverty Reduction and Equity Department at the World Bank

As Latin America tries to further reduce poverty and inequality, a big question is whether the current combination of taxes and benefits (such as cash transfers) are sufficient. At the recent Latin American Economic Association Meetings (LACEA) held in Universidad del Pacifico in Peru, Nora Lustig—Professor of Latin American Economics at Tulane University—presented a seminal paper on equity and distribution that suggests the answer is no.

Walking on a mud-filled road in the Amazon
Walking on a mud-filled road in the Amazon. World Bank.


In an interview with the JKP team and Vox LACEA, she explains that standard measures of poverty and inequality may show an improvement for society as a whole but mask the fact that some people that weren’t poor become poor as a result of the fiscal package, and some poor become even poorer. What is needed to tease out this discrepancy is an additional measure called "fiscal mobility"—that is, a “before”/“after” comparison that would show winners and losers of taxes and transfers. Applying this measure to Brazil, she and her co-author (Sean Higgins) find that 11 percent of the non-poor become poor, 15 percent of the moderate poor become extremely poor, and 4 percent of the extremely poor become ultra-poor.

<iframe src="https://cdns.snacktools.net/tubesnack/embed_https.html?hash=tznsrs5p&wmode=window&bgcolor=FFFFFF&t=1392067914" width="500" height="535" seamless="seamless" scrolling="no" frameborder="0" allowtransparency="true"></iframe>
 
This work—part of the Commitment to Equity project sponsored by Tulane University and the Inter-American Dialogue—is important to identify how a given combination of taxes and transfers can change the income distribution and make a poor person even poorer. And this approach would be important to mainstream in standard fiscal incidence analysis. What tools would policy makers have at their disposal to improve outcomes? Lustig suggests alternative tax scenarios or attempting to compensate the losing poor for their losses and prevent any non-poor from becoming poor (by compensating them up to the point that they remain non-poor). ​

Comments

maitri shah says
I really enjoyed reading your article. I found this as an informative and interesting post free xbox gift code generator
 on  7/27/2018 5:10:30 AM  

Add Comment

Name *


Email *

Body *

 
 

 CATEGORIES

 
 

 AUTHORS

 
  
expand Author : Abdullah Al-Dailami ‎(1)
expand Author : Adriana Kugler ‎(2)
expand Author : Alice Githu ‎(1)
expand Author : Amadeus Kamagenge ‎(1)
expand Author : Amelie Constant ‎(1)
expand Author : Amina Semlalia ‎(1)
expand Author : Anil Swarup ‎(1)
expand Author : Arup Banerji, Asli Demirguc-Kunt, and Jaime Saavedra Chanduvi ‎(1)
expand Author : Arup Banerji, David A. Robalino ‎(1)
expand Author : Baptiste Cammareri ‎(1)
expand Author : Branka Minic ‎(1)
expand Author : Brij Kothari  ‎(1)
expand Author : Cai Fang ‎(1)
expand Author : Carmen PagÉs ‎(1)
expand Author : Charles Sabel ‎(2)
expand Author : Claudia Baddini ‎(1)
expand Author : Claudia Sepulveda ‎(7)
expand Author : Constantino Gonzalez ‎(1)
expand Author : Dala T. Korkoyah, Jr. ‎(1)
expand Author : Daniel Hamermesh ‎(1)
expand Author : David A. Robalino ‎(14)
expand Author : David A. Robalino and Mattias Lundberg ‎(1)
expand Author : David Grubb and Jochen Kluve ‎(1)
expand Author : Dennis Szeszko ‎(1)
expand Author : Dickson Malunda  ‎(1)
expand Author : Edgard Rodriguez ‎(1)
expand Author : Fernando Fabre ‎(1)
expand Author : Francois Bourguignon ‎(2)
expand Author : Gabriela Inchauste ‎(1)
expand Author : Gerardo Esquivel ‎(2)
1 - 30Next
 

 Archives

 
  
expand MonthYear : 10/1/2014 ‎(1)
expand MonthYear : 9/1/2014 ‎(1)
expand MonthYear : 7/1/2014 ‎(5)
expand MonthYear : 6/1/2014 ‎(4)
expand MonthYear : 5/1/2014 ‎(6)
1 - 5Next
 

  Tag Cloud

 
 

 WORLD BANK ON JOBS

 
Retrieving Data
 

 Recent Blog Posts

 
  
The JKP Blog Has Moved
Remittances from Qatar:&nbsp; Less-informed Families Receive Less
Jobs and the “Great Recession” – Part 2
Jobs and the “Great Recession” – Part 1
Juggling Labor, Credit, and Crops in Zambia