On the Unequal Inequality of Poor Communities

Communities differ in important ways in their needs, capacities,and circumstances. Because central governments are not ableto discern these differences fully, they seek to achieve theirpolicy objectives by relying on decentralized mechanisms thatuse local information. Household and individual characteristicswithin communities can also vary substantially. A growing bodyof theoretical literature suggests that inequality within communitiescan influence policy outcomes in ways that are either harmfulor helpful, depending on the circumstances. Until recently,empirical investigations into the impact of inequality havebeen held back by a lack of systematic evidence on community-levelinequality. This study uses household survey and populationcensus data to estimate per capita consumption inequality withincommunities in three developing economies. It finds that communitiesvary markedly in their degree of inequality. It also shows thatthere should be no presumption that inequality is less severein poor communities. The kind of community-level inequalityestimates generated here can be used in designing and evaluatingdecentralized antipoverty programs.     

Regulatory harmonization and the development of private equity markets

This paper introduces a new dataset from 100 Dutch institutional investors’ domestic and international asset private equity allocations. The data indicate that the perceived comparative dearth of regulations of private equity funds impedes institutional investor participation in private equity funds, particularly in relation to the lack of transparency. The data further indicate that the perceived importance of regulatory harmonization of institutional investors has increased Dutch institutional investor allocations to domestic and international private equity funds. The Financieel Toetsingskader (regulation of portfolio management standards such as matching of assets and liabilities) has had the most pronounced and robust effect, followed by Basel II (regulation of risk management and disclosure standards) and the International Financial Reporting Standards (regulation of reporting standards and transparency).     

Towards regional food security in southern Africa: a (new) policy framework for the agricultural sector

In the southern African Region (SAR) large populations, mainly concentrated in rural areas, face food insecurity and poverty. Food insecurity is intensified by adverse weather conditions and droughts which impact negatively on farm level food production throughout the region. Agriculture constitutes an important economic sector in the majority of countries in the region. This is measured as share of agricultural value added to the GDP and as agriculture's share in employment. Based on these facts alone, it must be obvious that sustained agricultural performance will play a significant role in the improvement of food security and livelihoods in the region. However, food security is not only attained in rural areas and by the consumption of home produced food stuffs. Urbanisation is expected to increase dramatically over the next few decades and feeding the urban masses, at affordable prices, must be considered to be a high future priority for governments in the region. Food security must not be viewed as an agricultural issue per se. The drive to food self sufficiency through domestic agriculture production in many countries in the region did not enable these countries to feed their own population. Food security should rather be defined as the acquirement of sufficient and nutritious quantities of food (Sen, 1981, Poverty and Famines: An essay on Entitlement and Deprivation). An approach, whereby attention is given to the macro level availability of food, access to income streams as well as improved production capacity to acquire food at a household level and the utilisation of nutritious food, should therefore be guiding food security policies (SADC: FSTAU, 1997, A Strategic Framework for Food Security in the Region). This broader view emphasises household level poverty reduction, economic development and growth as important components of a food security strategy (World Food Summit, Rome, 1996). An important issue which therefore needs to be explored is whether agriculture does have the potential to contribute to economic processes, which will support broad based development and food security. This paper is intended to argue the importance of agricultural development for food security in the region and to develop a diverse policy framework to strengthen this new, more comprehensive role of agriculture in the region.     

Reforms,globalization, and endogenous agricultural structures

In this article, I draw lessons from two quasi‐natural experiments (the transition process in former Communist countries and the rapid globalization of food chains) on the optimality of farms and agricultural structures more generally. I argue that (a) the farm structures that have emerged from the transition process are much more diverse than expected ex ante; (b) this diversity is to an important extent determined by economic mechanisms which are influenced by initial conditions and reform policies; (c) non‐traditional farm structures have played an important role during transition because they were optimal to address the specific institutional and structural constraints imposed by the transition process; (d) there is more diversity than often argued in the farms that are integrated in global food chains; (e) endogenous institutional (contracting) innovations in food chains may lock existing farm structures in a long‐run institutional framework; and (f) indicators based on farm structures are not a good measure of welfare effects of the globalization of food chains.     

The Heavenly Calculus and Socially Responsible Business Conduct: An Explorative Study among Executives

Summary In this paper we present a theoretical economic model, describing the influence of eschatological beliefs of executives on their socially responsible business conduct. The core hypothesis is that the belief that one’s eternal destination depends on how one behaves in business will provide an incentive to socially responsible business conduct. We confront the model with explorative empirical data, collected by in-depth interviews with and questionnaires among twenty Dutch executives. The data provide weak indications that eschatological beliefs influence the executives’ socially responsible business conduct. The authors would like to thank the Dutch Ministry of Economic Affairs and the employers’ association VNO-NCW for their financial support. Thanks also to Boaz van Luijk and Aziza Yahia for their assistance in the collection of data used in this paper. We also thank the editor, professor M.M.G. Fase, and two anonymous referees for their valuable suggestions.     

Economic integration, market size and the welfare effects of trade liberalisation

Economic Integration, Market Size and the Welfare Effects of Trade Liberalisation. — This paper examines the welfare effects of regional and global integration in a model where market size matters. Regional integration leads to higher welfare in the countries of a preferential trading arrangement (PTA), but to lower welfare outside. In case the countries also decide to form a customs union (CU), both countries will experience further gains if the creation of the CU means that the average external trade barriers are raised. In turn, the outside country will in this case experience further welfare losses. If it retaliates and creates a trade war, this will lower welfare in all countries. In contrast, global integration mostly benefits both PTA countries and outside countries.     

Public Sector Transformation and Ethics: A View from South Africa

This article describes the change processes the Government of National Unity adopted after the 1994 elections in order to transform the South African public service. It shows that the Government is faced with a number of problems (reasons for change) some of which emanate from the legacy of the apartheid past and others from the current situation. Further, the article looks at the vision, mission and objectives set by the Government for the transformation process, while the current change policies and programmes are also highlighted. Finally, the article explores how the Government is dealing with the ethical issues arising from the transformation.