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Who Benefits from Increased Access to Public Services at the Local Level? A Marginal Benefit Incidence Analysis for Education and Basic Infrastructure

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  • Ajwad, Mohamed Ishan
  • Wodon, Quentin

Abstract

Do poor people benefit more or less than the nonpoor from an expansion in access to public services? And do those benefits depend on the existing level of access? Answering these questions is essential to strategies for empowering (or “investing in”) poor people, but the lack of panel data or repeated crosssectional data in poor countries has often made it impossible. This paper proposes a methodology for answering these questions using data from only a single cross-section survey. We argue that the methodology may be useful for monitoring the allocation of public expenditures in a context of decentralization, and we demonstrate this by applying it to local-level data from Bolivia and Paraguay. The results indicate that the marginal benefit incidence is higher (or at least not systematically lower) for the poor than for the nonpoor in education, but this is not the case for many basic infrastructure services. More generally, the poor seem to gain access only once the nonpoor already have high levels of access. This suggests that pro-poor policies must be implemented if the poor are to reap the benefits of gains in access faster.

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Bibliographic Info

Paper provided by University Library of Munich, Germany in its series MPRA Paper with number 12309.

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Date of creation: Jul 2002
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Handle: RePEc:pra:mprapa:12309

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Keywords: Benefit incidence analysis; education; basic infrastructure;

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References

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  1. Lanjouw, Peter & Ravallion, Martin, 1999. "Benefit Incidence, Public Spending Reforms, and the Timing of Program Capture," World Bank Economic Review, World Bank Group, vol. 13(2), pages 257-73, May.
  2. Shoup, Carl S., 1989. "Rules for Distributing a Free Government Service Among Areas of a City," National Tax Journal, National Tax Association, vol. 42(2), pages 103-21, June Cita.
  3. Wodon, Quentin & Yitzhaki, Shlomo, 2002. "Inequality and Social Welfare," MPRA Paper 12298, University Library of Munich, Germany.
  4. Charles M. Tiebout, 1956. "A Pure Theory of Local Expenditures," Journal of Political Economy, University of Chicago Press, vol. 64, pages 416.
  5. Wodon, Quentin & Yitzhaki, Shlomo, 2003. "The effect of using grouped data on the estimation of the Gini income elasticity," Economics Letters, Elsevier, vol. 78(2), pages 153-159, February.
  6. Quentin Wodon & Shlomo Yitzhaki, 2002. "Evaluating the Impact of Government Programs on Social Welfare: The Role of Targeting and the Allocation Rules Among Program Beneficiaries," Public Finance Review, , vol. 30(2), pages 102-123, March.
  7. Behrman, Jere R & Craig, Steven G, 1987. "The Distribution of Public Services: An Exploration of Local Governmental Preferences," American Economic Review, American Economic Association, vol. 77(1), pages 37-49, March.
  8. Shlomo Yitzhaki, 2001. "A Public Finance Approach to Assessing Poverty Alleviation," NBER Working Papers 8062, National Bureau of Economic Research, Inc.
  9. Ravallion, Martin & Wodon, Quentin, 2000. "Banking on the Poor? Branch Location and Nonfarm Rural Development in Bangladesh," Review of Development Economics, Wiley Blackwell, vol. 4(2), pages 121-39, June.
  10. Brueckner, Jan K., 2000. "A Tiebout/tax-competition model," Journal of Public Economics, Elsevier, vol. 77(2), pages 285-306, August.
  11. Caroline M. Hoxby, 2000. "Does Competition among Public Schools Benefit Students and Taxpayers?," American Economic Review, American Economic Association, vol. 90(5), pages 1209-1238, December.
  12. Yitzhaki, Shlomo, 1982. "Relative deprivation and economic welfare," European Economic Review, Elsevier, vol. 17(1), pages 99-113.
  13. Hoxby, Caroline M., 1999. "The productivity of schools and other local public goods producers," Journal of Public Economics, Elsevier, vol. 74(1), pages 1-30, October.
  14. Ravallion, Martin & Wodon, Quentin, 1997. "Banking on the poor? Branch placement and nonfarm rural development in Bangladesh," Policy Research Working Paper Series 1858, The World Bank.
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Cited by:
  1. Ruwan Jayasuriya & Quentin Wodon, 2007. "Efficiency in Improving Health and Education Outcomes: Provincial and State-Level Estimates for Argentina and Mexico," Estudios Económicos, El Colegio de México, Centro de Estudios Económicos, vol. 22(1), pages 57-97.

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