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Anti-Poverty Transfers without Riots in Tunisia

We draw some lessons from the Tunisian experience of social reforms and associated unrest. Our main interest is the riots that occurred after subsidy cuts and the attempts at substitution of price subsidies by direct cash transfers. We propose new welfare indicators to assess reforms in such situations. Using micro level data, we show that plausible policy decisions depend on parameters describing the balance between poverty and program exclusion risk. In the Tunisian case, only a much larger weight put on poverty relatively to exclusion could bring the decision maker to substitute in force price subsidies with direct cash transfers.

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Paper provided by Institut d'economie publique (IDEP), Marseille, France in its series IDEP Working Papers with number 0801.

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Length: 27 pages
Date of creation: Mar 2008
Date of revision: Mar 2008
Handle: RePEc:iep:wpidep:0801
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  1. Sami Bibi & Jean-Yves Duclos, 2004. "Equity and Policy Effectiveness with Imperfect Targeting," Working Papers 0423, Economic Research Forum, revised Oct 2004.
  2. Heinrich, Carolyn J., 2007. "Demand and Supply-Side Determinants of Conditional Cash Transfer Program Effectiveness," World Development, Elsevier, vol. 35(1), pages 121-143, January.
  3. Bigman, David & Fofack, Hippolyte, 2000. "Geographical Targeting for Poverty Alleviation: An Introduction to the Special Issue," World Bank Economic Review, World Bank Group, vol. 14(1), pages 129-45, January.
  4. Park, Albert & Wang, Sangui & Wu, Guobao, 2002. "Regional poverty targeting in China," Journal of Public Economics, Elsevier, vol. 86(1), pages 123-153, October.
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  7. Christophe MULLER and Sami BIBI, 2008. "Focused Transfer Targeting against Poverty Evidence from Tunisia," THEMA Working Papers 2008-37, THEMA (THéorie Economique, Modélisation et Applications), Université de Cergy-Pontoise.
  8. Bigman, David & Srinivasan, P. V., 2002. "Geographical targeting of poverty alleviation programs: methodology and applications in rural India," Journal of Policy Modeling, Elsevier, vol. 24(3), pages 237-255, June.
  9. Muller, Christophe, 2008. "The Measurement of Poverty with Geographical and Intertemporal Price Dispersion. Evidence from Rwanda," Economics Papers from University Paris Dauphine 123456789/4381, Paris Dauphine University.
  10. Muller, Christophe, 2002. "Prices and living standards: evidence for Rwanda," Journal of Development Economics, Elsevier, vol. 68(1), pages 187-203, June.
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  12. Baker, Judy L. & Grosh, Margaret E., 1994. "Poverty reduction through geographic targeting: How well does it work?," World Development, Elsevier, vol. 22(7), pages 983-995, July.
  13. Skoufias, Emmanuel & Coady, David P., 2002. "Are the welfare losses from imperfect targeting important?," FCND discussion papers 125, International Food Policy Research Institute (IFPRI).
  14. Creedy, John, 1996. "Comparing Tax and Transfer Systems: Poverty, Inequality and Target Efficiency," Economica, London School of Economics and Political Science, vol. 63(250), pages S163-74, Suppl..
  15. Schady, Norbert R., 2000. "Picking the poor : indicators for geographic targeting in Peru," Policy Research Working Paper Series 2477, The World Bank.
  16. John Maluccio & Natàlia Caldés & David Coady, 2005. "The Cost of Poverty Alleviation Transfer Programs: A Comparative Analysis of Three Programs in Latin America," Middlebury College Working Paper Series 0527, Middlebury College, Department of Economics.
  17. Bourguignon, Francois & Fields, Gary, 1997. "Discontinuous losses from poverty, generalized P[alpha] measures, and optimal transfers to the poor," Journal of Public Economics, Elsevier, vol. 63(2), pages 155-175, January.
  18. S. M. Ravi Kanbur, 1987. "Measurement and Alleviation of Poverty: With an Application to the Effects of Macroeconomic Adjustment (Evaluation quantitative de la pauvreté et remèdes possibles: analyse des effets d'un ajustemen," IMF Staff Papers, Palgrave Macmillan, vol. 34(1), pages 60-85, March.
  19. Giovanni Andrea Cornia & Frances Stewart, 1993. "Two Errors of Targeting," Innocenti Occasional Papers, Economic Policy Series iopeps93/54, UNICEF Innocenti Research Centre.
  20. Foster, James & Greer, Joel & Thorbecke, Erik, 1984. "A Class of Decomposable Poverty Measures," Econometrica, Econometric Society, vol. 52(3), pages 761-66, May.
  21. François BOURGUIGNON & Gary S. FIELDS, 1990. "Poverty Measures and Anti-Poverty Policy," Discussion Papers (REL - Recherches Economiques de Louvain) 1990038, Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES).
  22. Philippe De Donder & Jean Hindriks, 1998. "The political economy of targeting," Public Choice, Springer, vol. 95(1), pages 177-200, April.
  23. Ahmed, Akhter U. & Bouis, Howarth E., 2002. "Weighing what's practical: proxy means tests for targeting food subsidies in Egypt," Food Policy, Elsevier, vol. 27(5-6), pages 519-540.
  24. Alderman, Harold & Lindert, Kathy, 1998. "The Potential and Limitations of Self-Targeted Food Subsidies," World Bank Research Observer, World Bank Group, vol. 13(2), pages 213-29, August.
  25. Pollak, Robert A & Wales, Terence J, 1979. "Welfare Comparisons and Equivalence Scales," American Economic Review, American Economic Association, vol. 69(2), pages 216-21, May.
  26. David Coady, 2004. "Targeting Outcomes Redux," World Bank Research Observer, World Bank Group, vol. 19(1), pages 61-85.
  27. Datt, Gaurav & Ravallion, Martin, 1990. "Regional disparities, targeting, and poverty in India," Policy Research Working Paper Series 375, The World Bank.
  28. Coady, David P. & Grosh, Margaret & Hoddinott, John, 2002. "Targeting outcomes redux," FCND discussion papers 144, International Food Policy Research Institute (IFPRI).
  29. Gutner, Tamar, 2002. "The political economy of food subsidy reform: the case of Egypt," Food Policy, Elsevier, vol. 27(5-6), pages 455-476.
  30. Galasso, Emanuela & Ravallion, Martin, 2005. "Decentralized targeting of an antipoverty program," Journal of Public Economics, Elsevier, vol. 89(4), pages 705-727, April.
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