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Economists have had much to say about the impact of economic policies on growth, but little on their distributional consequences and poverty impact. The reorientation of development policy from structural adjustment to poverty reduction as the central objective thus called for new tools to examine distributional change. This book analyzes the poverty and distributional impact of policy changes and external shocks in three case studies from Latin America: Trade liberalization in Colombia and Brazil, and the gas boom in Bolivia. It uses an innovative approach that combines computable general equilibrium and microsimulation models. The country applications illustrate that distributional consequences depend very much on the nature of the shock or policy change as well as the characteristics of the country in question. The book issues a warning against policy prescriptions being based on oversimplifying assumptions and models.

Engagement in non-agricultural activities in rural areas can be classified into survival-led or opportunity-led. Survival-led diversification would decrease inequality by increasing the incomes of poorer households and thus reduce poverty. By contrast, opportunity-led diversification would increase inequality and have a minor effect on poverty, as it tends to be confined to non-poor households. Using data from Western Kenya, we confirm the existence of the differently motivated diversification strategies. Yet, the poverty and inequality implications differ somewhat from our expectations. Our findings indicate that in addition to asset constraints, rural households also face limited or relatively risky high-return opportunities outside agriculture. -- Income diversification ; non-agricultural activities ; inequality ; poverty ; sub-Saharan Africa ; Kenya

Cover -- 1. General introduction and main findings -- 2. The poverty and distributional impact of "opening-up": Urban Colombia in the early 1990s -- 2.1. Introduction -- 2.2. Colombia in the early 1990s: "Apertura" and a non-tradable boom -- 2.3. Capturing the transmission channels: Methodology -- 2.4. The poverty and distributional impact of "Apertura" -- 2.5. Conclusions -- 2.6. Appendices -- 2.6.1. Additional figures -- 2.6.2. Additional tables -- 3. Resource booms, inequality, and poverty: The case of gas in Bolivia -- 3.1. Introduction -- 3.2. The gas boom and other resource shocks -- 3.3. The modelling framework -- 3.3.1. The CGE model -- 3.3.2. The microsimulation model -- 3.4. Results -- 3.4.1. Stylized simulations for link variables -- 3.4.2. Gas shock simulations -- 3.5. Concluding remarks -- 3.6. Appendices -- 3.6.1. Additional figures -- 3.6.2. Additional tables -- 4. Structural change and poverty reduction in Brazil: The impact of the Doha Round -- 4.1. Introduction -- 4.2. Background and motivation -- 4.3. The modeling framework -- 4.3.1. The macro model -- 4.3.2. The micro model -- 4.4. Brazil in the next decade: How trade policy affects a Business as Usual scenario? -- 4.4.1. The Business as Usual macro results -- 4.4.2. Distributional and poverty results for the BaU -- 4.4.3. Macro results for the full liberalization and the Doha trade policy shocks -- 4.4.4. Trade scenarios' distributional and poverty results -- 4.5. Conclusions -- 4.6. Appendices -- 4.6.1. Additional tables -- 5. Conclusions, policy relevance, and future research -- 6. References.

Economists have had much to say about the impact of economic policies on growth, but little on their distributional consequences and poverty impact. The reorientation of development policy from structural adjustment to poverty reduction as the central objective thus called for new tools to examine distributional change. This book analyzes the poverty and distributional impact of policy changes and external shocks in three case studies from Latin America: Trade liberalization in Colombia and Brazil, and the gas boom in Bolivia. It uses an innovative approach that combines computable general equilibrium and microsimulation models. The country applications illustrate that distributional consequences depend very much on the nature of the shock or policy change as well as the characteristics of the country in question. The book issues a warning against policy prescriptions being based on oversimplifying assumptions and models.

Economists have had much to say about the impact of economic policies on growth, but little on their distributional consequences and poverty impact. The reorientation of development policy from structural adjustment to poverty reduction as the central objective thus called for new tools to examine distributional change. This book analyzes the poverty and distributional impact of policy changes and external shocks in three case studies from Latin America: Trade liberalization in Colombia and Brazil, and the gas boom in Bolivia. It uses an innovative approach that combines computable general equilibrium and microsimulation models. The country applications illustrate that distributional consequences depend very much on the nature of the shock or policy change as well as the characteristics of the country in question. The book issues a warning against policy prescriptions being based on oversimplifying assumptions and models

This paper reviews the effectiveness and efficiency of key policy instruments for MDG (Millennium Development Goals) achievement. We first demonstrate that average MDG progress is likely to be too slow to meet the education and health sector targets in a number of developing countries. We also show that MDG achievement can be described by a transition path with declining rates of progress. More detailed analysis reveals that the transition towards universal primary enrollment in poor countries with low initial enrollment has accelerated considerably in the more recent past. The paper then focuses on the role of demand- versus supply-side factors in social service utilization in education and health. The main policy conclusions of the review reflect some of the key determinants of MDG achievement: First, specific single-policy interventions can have a considerable impact on social service utilization and specific human development outcomes. For example, improving access to basic health services, in particular to vaccination, has been a key factor in reducing child mortality rates in a number of very poor countries. Second, demand-side policies have proved extremely effective, for example, in increasing school enrollment and attainment levels. However, there may be more scope for targeting the demand side in the health sector. Third, policy effectiveness and efficiency are highly dependent on initial conditions and the specificities of the respective policy. Fourth, complementarities between MDG targets, in particular social service utilization, are likely to be very important. ; Ein primäres Anliegen dieses Beitrages ist die Untersuchung der Effektivität und Effizienz von Politikinstrumenten zu Erreichung der Weltentwicklungsziele. Zu Beginn wird gezeigt, dass der durchschnittliche Fortschritt zu langsam ist, um die angestrebten Ziele im Gesundheits- und Bildungssektor in einer Vielzahl von Entwicklungsländern zu erreichen. Festzustellen ist, dass sich der Transitionspfad durch eine abnehmende Fortschrittsgeschwindigkeit auszeichnet. Detailliertere Analysen zeigen, dass es in jüngster Vergangenheit beachtliche Erfolge bezüglich des Besuches von Primarschulen in armen Ländern - bei sehr schlechter Ausgangslage - gegeben hat. Ein weiterer Aspekt der Untersuchung ist die Rolle von nachfrage- versus angebotsorientierten Faktoren, welche die Nutzung von öffentlichen Dienstleistungen im Gesundheitsund Bildungssektor beeinflussen. - Erstens können spezifische einzelne Interventionen eine herausragende Wirkung in Bezug auf die Nutzung öffentlicher Dienstleistungen und direkter Entwicklungsindikatoren erzielen. So ist beispielsweise der Zugang zu grundlegenden Gesundheitsdienstleistungen, insbesondere Impfungen, ein bedeutsamer Faktor für die stark abnehmenden Kindersterblichkeitsraten in einer ganzen Reihe von Ländern. Dennoch gibt es offenbar nicht ausgeschöpfte Potentiale im Gesundheitssektor. - Zweitens haben sich nachfrageorientierte Maßnahmen - insbesondere zur Erhöhung der Einschulungsraten - als sehr effektiv herausgestellt. - Drittens sind sowohl die Effektivität - als auch die Effizienz von politischen Maßnahmen entscheidend von den Ausgangsbedingungen und Charakteristika des jeweiligen Instruments abhängig. - Viertens sind allem Anschein nach die Komplementaritäten zwischen unterschiedlichen Weltentwicklungszielen von großer Bedeutung.

Economists have had much to say about the impact of economic policies on growth, but little on their distributional consequences and poverty impact. The reorientation of development policy from structural adjustment to poverty reduction as the central objective thus called for new tools to examine distributional change. This book analyzes the poverty and distributional impact of policy changes and external shocks in three case studies from Latin America: Trade liberalization in Colombia and Brazil, and the gas boom in Bolivia. It uses an innovative approach that combines computable general equilibrium and microsimulation models. The country applications illustrate that distributional consequences depend very much on the nature of the shock or policy change as well as the characteristics of the country in question. The book issues a warning against policy prescriptions being based on oversimplifying assumptions and models.

The promotion of private investment, in particular in the form of Foreign Direct Investment (FDI), has been a key component of economic development strategies since the early 1990s. Recent development policy initiatives, for example the G20 Compact with Africa (CwA) but also Germany's "Marshall Plan with Africa", put re-renewed emphasis on mobilizing foreign private capital for accelerated economic growth and, most importantly, the creation of productive employment at scale. This emphasis rests on two important assumptions: First, it assumes that FDI is conducive to economic development through technology transfer, increased productivity and additional jobs - at least when it comes as greenfield investment. Second, it assumes that government policies can be successful in attracting FDI to achieve those benefits. Both developed and developing countries have "redcarpet policies" in place, which - in developing countries - are often supported by bilateral donors and multilateral institutions: governments provide special tax treatment and subsidies to foreign investors, have established special economic zones and investment promotion agencies, seek to mobilize private finance through blending, and improve the investment climate, for example by negotiating investment treaties. The present study reviews the empirical evidence that puts to test these two assumptions. After presenting a conceptual framework we systematically review the vast empirical literature on the ramifications of FDI in developing host countries with a focus on employment effects. This part of the study is followed by an assessment of the empirical evidence on the impact of different investment promotion instruments on FDI inflows and subsequent development outcomes, again emphasizing employment outcomes. As the review will show, direct estimates of the cost-effectiveness of FDI promotion policies are scarce. Yet, taken together, the two parts of this study allow for insights as to whether the effects on FDI flows and the subsequent development, in particular employment, effects are quantitatively large enough to justify the costly efforts of governments to attract FDI. In a last part, we therefore discuss the policy implications of the reviewed evidence.

The wave of upbeat stories on the developing world's emerging middle class has reinvigorated a debate on how social class in general and the middle class in particular ought to be defined and empirically measured. With the aim of adding clarity to this debate, this dissertation provides a structured overview of a wide array of definitions of the middle class that have been suggested in the economics literature, and assesses their strengths and shortcomings using South Africa as a case study. Contrary to most standard approaches in the economic realm, the main argument this dissertation make...

This article analyses the determinants of growing demand for agricultural land in developing countries. We propose some determinants that are specific to foreign acquisitions of agricultural land as a subset of agricultural foreign direct investment (FDI) and empirically examine the corresponding locational choice. Using a gravity model and a data set on land acquisitions worldwide, we find that the determinants partly overlap with those for other forms of FDI but are specific in certain regards. Rich investors target (poorer) economies with abundant land and water resources, and the effects of the quality of institutions are ambiguous.

Human induced land-use change has direct economic and ecological consequences, which are felt the most in the poorest world regions. Therefore, the key question in land-use change research is how to protect and enhance the ecological functions of tropical landscapes while simultaneously improving human welfare. Addressing the complex links between the economic and ecological sphere, this dissertation seeks to shed a light on the socio-economic drivers of land-use change in developing countries. Taking Indonesia as an example, this thesis will specifically focus on the determinants and impac...