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Efficiency, Equity and Poverty Alleviation: Policy Issues in Less Developed Countries

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  • Bardhan, Pranab

Abstract

In this paper we start by noting that policies that help growth by improving allocational efficiency may also help the poor. We then go on to consider cases where in view of serious agency costs and coordination problems (particularly involving processes in credit and insurance markets) there may be a great deal of scope for trying redistributive projects which at the same time enhance productive efficiency, contrary to the message of efficiency-equity trade-off central to mainstream policy economics. In this context we discuss the efficiency effects of asset distribution programs like land reform. We then examine the merits and costs of targeting transfers aimed at improving their cost-effectiveness, including issues of self-selection by the poor and of targeting disadvantaged groups and backward areas. Finally, we discuss governance structures and focus on the role of self-governing institutions at the local level in improving efficiency and equity in poverty alleviation.

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Bibliographic Info

Paper provided by Center for International and Development Economics Research, Institute for Business and Economic Research, UC Berkeley in its series Center for International and Development Economics Research, Working Paper Series with number qt3jq4h9sc.

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Date of creation: 01 Mar 1996
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Handle: RePEc:cdl:ciders:qt3jq4h9sc

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Keywords: redistribution; targeting; disadvantaged groups; Social and Behavioral Sciences; Economic Policy;

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References

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  1. Galor, Oded & Zeira, Joseph, 1988. "Income Distribution and Macroeconomics," MPRA Paper 51644, University Library of Munich, Germany, revised 01 Sep 1989.
  2. Banerjee, Abhijit V & Newman, Andrew F, 1993. "Occupational Choice and the Process of Development," Journal of Political Economy, University of Chicago Press, vol. 101(2), pages 274-98, April.
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Citations

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Cited by:
  1. Balisacan, Arsenio M. & Fuwa, Nobuhiko, 2004. "Changes in Spatial Income Inequality in the Philippines: An Exploratory Analysis," Working Paper Series UNU-WIDER Research Paper , World Institute for Development Economic Research (UNU-WIDER).
  2. Carlos Scartascini & Ernesto Stein & Mariano Tommasi, 2008. "Political Institutions, State Capabilities and Public Policy - International Evidence," Research Department Publications 4608, Inter-American Development Bank, Research Department.
  3. Gruber, Lloyd & Kosack, Stephen, 2014. "The Tertiary Tilt: Education and Inequality in the Developing World," World Development, Elsevier, vol. 54(C), pages 253-272.
  4. Christopher Cramer, 2000. "Inequality, Development and Economic Correctness," Working Papers 105, Department of Economics, SOAS, University of London, UK.
  5. Christophe Muller, 2006. "Poverty Simulation And Price Changes," Working Papers. Serie AD 2006-13, Instituto Valenciano de Investigaciones Económicas, S.A. (Ivie).
  6. Krueger, Anne O, 1997. "Trade Policy and Economic Development: How We Learn," American Economic Review, American Economic Association, vol. 87(1), pages 1-22, March.
  7. Muller, Christophe, 2002. "Prices and living standards: evidence for Rwanda," Journal of Development Economics, Elsevier, vol. 68(1), pages 187-203, June.
  8. World Bank, 2007. "Arab Republic of Egypt : Poverty Assessment Update, Volume 1. Main Report," World Bank Other Operational Studies 7642, The World Bank.
  9. Guilherme Berse Rodrigues Lambais & Marcelo Marques De Magalhães & José Maria Ferreira Jardim Da Silveira, 2014. "Land Reform And Technical Efficiency: Panel Data Evidence From Northeastern Brazil," Anais do XL Encontro Nacional de Economia [Proceedings of the 40th Brazilian Economics Meeting] 200, ANPEC - Associação Nacional dos Centros de Pósgraduação em Economia [Brazilian Association of Graduate Programs in Economics].
  10. Barrera-Osorio, Felipe & Filmer, Deon, 2013. "Incentivizing schooling for learning : evidence on the impact of alternative targeting approaches," Policy Research Working Paper Series 6541, The World Bank.

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