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Methods for measuring the effect of adjustment policies on income distribution

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  • Maasland, Anne
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    Abstract

    The effect of adjustment policies on different groups in the population is an important and complex issue. The distributional implications can have a large influence on the sustainability of programs. In particular, there is a need to identify how different groups in society are affected by an adjustment program and how an alternative mix of policies would affect this outcome. This assessment will be useful for developing compensation schemes for those groups that may be negatively affected in the transitional adjustment period, and in generating support for adjustment programs. This paper reviews the methodologies that have been suggested to study the effect of adjustment on distribution and provides examples of each approach. Each method is evaluated and data requirements are described. The review provides a range of approaches to selecta method to apply to a particular country. The paper also reviews recent work on macropolicies and income distribution and provides recommendations and conclusions.

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    Bibliographic Info

    Paper provided by The World Bank in its series Policy Research Working Paper Series with number 474.

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    Date of creation: 31 Aug 1990
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    Handle: RePEc:wbk:wbrwps:474

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    Related research

    Keywords: Inequality; Achieving Shared Growth; Environmental Economics&Policies; Economic Theory&Research; Health Economics&Finance;

    References

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    1. François Bourguignon & William H. Branson & Jaime de Melo, 1989. "Macroeconomic Adjustment and Income Distribution: A Macro-Micro Simulation Model," OECD Development Centre Working Papers 1, OECD Publishing.
    2. Anne O. Krueger, 1983. "Trade and Employment in Developing Countries, 3: Synthesis and Conclusions," NBER Books, National Bureau of Economic Research, Inc, number krue83-1.
    3. Quizon, Jaime & Binswanger, Hans, 1986. "Modeling the Impact of Agricultural Growth and Government Policy on Income Distribution in India," World Bank Economic Review, World Bank Group, vol. 1(1), pages 103-48, September.
    4. Kakwani, N., 1990. "Poverty And Economic Growth: With Application To Cote D'Ivoire," Papers 63, World Bank - Living Standards Measurement.
    5. Decaluwe, Bernard & Martens, Andre, 1988. "CGE modeling and developing economies: A concise empirical survey of 73 applications to 26 countries," Journal of Policy Modeling, Elsevier, vol. 10(4), pages 529-568.
    6. Kakwani, N., 1990. "Poverty And Economic Growth; With Application To Cote D'Ivoire," Papers 90-2, New South Wales - School of Economics.
    7. Mussa, Michael, 1974. "Tariffs and the Distribution of Income: The Importance of Factor Specificity, Substitutability, and Intensity in the Short and Long Run," Journal of Political Economy, University of Chicago Press, vol. 82(6), pages 1191-1203, Nov.-Dec..
    8. Bourguignon, F. & Michel, G. & Miqueu, D., 1983. "Short-run rigidities and long-run adjustments in a computable general equilibrium model of income distribution and development," Journal of Development Economics, Elsevier, vol. 13(1-2), pages 21-43.
    9. Francois Bourguignon & William H. Branson & Jaime de Melo, 1989. "Adjustment and Income Distribution: A Counterfactual Analysis," NBER Working Papers 2943, National Bureau of Economic Research, Inc.
    10. Glewwe, Paul & de Tray, Dennis, 1991. "The Poor in Latin America during Adjustment: A Case Study of Peru," Economic Development and Cultural Change, University of Chicago Press, vol. 40(1), pages 27-54, October.
    11. Newman, John & Jorgensen, Steen & Pradhan, Menno, 1991. "How Did Workers Benefit from Bolivia's Emergency Social Fund?," World Bank Economic Review, World Bank Group, vol. 5(2), pages 367-93, May.
    12. Ravallion, Martin, 1989. "Do price increases for staple foods help or hurt the rural poor?," Policy Research Working Paper Series 167, The World Bank.
    13. Glewwe, P. & De Tray, D., 1988. "The Poor During Adjustment - A Case Study Of Cote D'Ivoire," Papers 47, World Bank - Living Standards Measurement.
    14. Neary, J Peter, 1985. "Theory and Policy of Adjustment in an Open Economy," CEPR Discussion Papers 61, C.E.P.R. Discussion Papers.
    15. Edwards, Sebastian, 1988. "Terms of Trade, Tariffs, and Labor Market Adjustment in Developing Countries," World Bank Economic Review, World Bank Group, vol. 2(2), pages 165-85, May.
    16. Bourguignon, Francois, 1991. "Optimal Poverty Reduction, Adjustment, and Growth," World Bank Economic Review, World Bank Group, vol. 5(2), pages 315-38, May.
    17. Knight, J B, 1976. "Devaluation and Income Distribution in Less-Developed Economies," Oxford Economic Papers, Oxford University Press, vol. 28(2), pages 208-27, July.
    18. Ethier, Wilfred J., 1984. "Higher dimensional issues in trade theory," Handbook of International Economics, in: R. W. Jones & P. B. Kenen (ed.), Handbook of International Economics, edition 1, volume 1, chapter 3, pages 131-184 Elsevier.
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    Cited by:
    1. Ehrhart, Christophe, 2006. "Croissance, redistribution et lutte contre la pauvreté : l’évolution non linéaire de l’approche de la Banque mondiale," L'Actualité Economique, Société Canadienne de Science Economique, vol. 82(4), pages 597-641, décembre.

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