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On the Impact of Better Targeted Transfers on Poverty in Tunisia

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  • Bibi, Sami

Abstract

This 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 sizeable economic efficiency loss resulting from relative price distortions. Further, non-parametric 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 so, 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 to model it. 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 food subsidies scheme within a range of poverty lines including all those estimated and generally used for Tunisia.

Suggested Citation

  • Bibi, Sami, 2002. "On the Impact of Better Targeted Transfers on Poverty in Tunisia," Cahiers de recherche 0203, CIRPEE.
    • Handle: RePEc:lvl:lacicr:0203
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    Cited by:

    1. Bibi, Sami & Duclos, Jean-Yves, 2007. "Equity and policy effectiveness with imperfect targeting," Journal of Development Economics, Elsevier, vol. 83(1), pages 109-140, May.
    2. Oluwaseun A. Oyebamiji & Mohsin Khan, 2023. "Multidimensional poverty in South‐West Nigeria: Empirical insights from a household survey in Osun State," Poverty & Public Policy, John Wiley & Sons, vol. 15(2), pages 227-250, June.
    3. Sami Bibi & Jean‐Yves Duclos, 2005. "Decomposing poverty changes into vertical and horizontal components," Bulletin of Economic Research, Wiley Blackwell, vol. 57(2), pages 205-215, April.
    4. Sami Bibi & John Cockburn & Massa Coulibaly & Luca Tiberti, 2009. "The Impact of the Increase in Food Prices on Child Poverty and the Policy Response in Mali," Papers inwopa09/66, Innocenti Working Papers.
    5. Sami Bibi & Massa Coulibaly & John Cockburn & Luca Tiberti, 2009. "L'impact de la hausse des prix des produits alimentaires sur la pauvreté des enfants et les reponses politiques au Mali," Papers inwopa09/60, Innocenti Working Papers.
    6. Sami Bibi, 2008. "Could the Behavioral Responses Justify the Absence of Direct Transfers to Fight Poverty in MENA Region?," Working Papers 396, Economic Research Forum, revised 03 Jan 2008.

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    More about this item

    Keywords

    Poverty; Targeting; Subsidies; Transfers;
    All these keywords.

    JEL classification:

    • 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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