On the Impact of Better Targeted Transfers on Poverty in Tunisia
AbstractThis paper describes the effects of general food subsidies on poverty in Tunisia, as revealed by household survey data for 1990. The analysis indicates that the poorest certainly take advantage of this system, but at the price of considerable leakages to non-poor people and at a sizable economic efficiency loss resulting from relative price distortions. Further, nonparametric estimations suggest that there are no commodities predominantly consumed by the poor. This implies that targeting by commodities is not an effective way to fight against poverty and, thus, it is unlikely that restructuring the current scheme would improve significantly the living standards of the less well-off members of society. We then investigate the impact on poverty of a more targeted transfer scheme, based on proxy means tests, using an appropriate econometric technique for modeling. Simulations show that this design would be more effective in reducing poverty than the use of general food subsidies. Finally, dominance tests show that this design would first-order-dominate a food subsidies scheme within a range of poverty lines, including all those estimated and generally used for Tunisia.
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Bibliographic InfoArticle provided by De Gruyter in its journal Review of Middle East Economics and Finance.
Volume (Year): 1 (2003)
Issue (Month): 1 (January)
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Web page: http://www.degruyter.com
Other versions of this item:
- Bibi, Sami, 2002. "On the Impact of Better Targeted Transfers on Poverty in Tunisia," Cahiers de recherche 0203, CIRPEE.
- D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis
- D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement
- H53 - Public Economics - - National Government Expenditures and Related Policies - - - Government Expenditures and Welfare Programs
- I32 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Measurement and Analysis of Poverty
- I38 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Government Programs; Provision and Effects of Welfare Programs
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"Equity and Policy Effectiveness with Imperfect Targeting,"
0423, Economic Research Forum, revised Oct 2004.
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- Sami Bibi & Jean-Yves Duclos, 2003. "Equity and Policy Effectiveness with Imperfect Targeting," Cahiers de recherche 0335, CIRPEE.
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