Effects of Patent Protection on Optimal Corporate Income and Consumption Taxes in an R&D‐Based Growth Model

Does reducing the corporate income tax accompanied by an increase in the consumption tax to meet the government's budget constraint improve welfare? To respond, we examine the welfare‐maximizing corporate income tax and consumption tax rates in an R&D‐based growth model under the constraint that the government's budget is balanced at each point of time. Further, we consider how welfare‐maximizing tax rates change as patent protection becomes stronger, as seen in many countries. The results show that as patent protection becomes stronger, the corporate income tax rate should be higher and the consumption tax rate should be lower. This implies that under stronger patent protection, recovering production at the expense of innovation by raising corporate income tax and reducing consumption tax improves welfare.     

Welfare receipt and the intergenerational transmission of work‐welfare norms

This article investigates the role of welfare receipt in shaping norms regarding work and welfare using unique Australian data from the Youth in Focus Project. We begin by incorporating welfare into a theoretical model of the transmission of work‐welfare norms across generations. Consistent with the predictions of this model, we find evidence that youths' attitudes toward work and welfare may be influenced by socialization within their families. Young people are more likely to oppose generous social benefits and to believe that social inequality stems from individual characteristics if (i) their mothers support these views; (ii) their mothers were employed while they were growing up; and (iii) their families never received welfare. Finally, youths' work‐welfare norms appear to be unrelated to their neighbors' welfare receipt suggesting that socialization occurs primarily within families rather than within neighborhoods.     

Optimal government spending in an economy with imperfectly competitive goods and labor markets

This article examines the growth‐ and welfare‐maximizing government spending in an economy that is characterized by market imperfections, namely, unionization in the labor market and monopolistic competition in the goods market. To thoughtfully explore the optimal spending, two distinct scenarios where the government spending is financed by labor/capital income taxes are considered. Our analysis shows that the optimal growth‐maximizing government spending is inconsistent with the welfare‐maximizing government spending. Moreover, the growth‐maximizing/welfare‐maximizing government spending have quite different responses to distinctive market imperfections (markups in the goods and labor markets), particularly in the scenarios with distinctive financing modes. Our numerical study indicates that the growth‐maximizing and welfare‐maximizing government expenditures, in general, are more responsive to the change in the labor market friction than that in the product market friction and the growth‐maximizing government spending is more likely to be lower than the welfare‐maximizing government spending.     

TAXING TIMES: STATE-LED INCOME REDISTRIBUTION IN NEW ZEALAND'S 'GOLDEN AGE'

Welfarism has been posited as central to how the state fostered the integration of the working class into the post-war economic order. However, analysis of national accounts data from 1949 to 1975 shows that New Zealand's welfare state redistributed income primarily from one fraction of the working class to another. That is, wage-earners financed their own collective consumption. This finding suggests that system integration effects of state welfare expenditure are predicated less on economic gains that accrue to labour, than they are on state-sponsored welfare discourse. Future research should therefore concentrate on both economic and discursive aspects of the welfare state.     

LINKING POVERTY AND INCOME SHOCKS TO RISKY SEXUAL BEHAVIOUR: EVIDENCE FROM A PANEL STUDY OF YOUNG ADULTS IN CAPE TOWN

Is there a link between household income and income stress, and risky sexual behaviour of young people? Anecdotal and qualitative evidence suggests this may be the case, but there is little quantitative research measuring this relationship. We use two waves of new data from the Cape Area Panel Study to investigate this link for 2,993 African and coloured youths aged 14 to 22 in 2002. In the process, we discuss one type of research design that could allow for a causal interpretation of the effect of income poverty on HIV risk. This design plausibly separates out the effect of income stress from the effect of living in a poor household by comparing behaviours across households with and without negative economic shocks, conditional on baseline income. Our results indicate that females in poorer households are more likely to be sexually active in 2002 and more likely to sexually debut by 2005. In addition, girls in households experiencing negative economic shocks are more likely to reduce condom use between 2002 and 2005. However, they are less likely to have multiple partners in 2002 or have transitioned to multiple partners by 2005. Males who experienced a negative shock are more likely to have multiple partners. Despite the tight research design for assessing shocks, the findings on the impacts of shocks do not generate clear recommendations for policy. There appears to be no systematic difference in condom use at last sex by household income levels or income shocks.     

COUNTING FOR DEMOCRACY: DEVELOPMENT OF NATIONAL STATISTICAL SYSTEMS IN A DECENTRALISED INDONESIA

Underlying the hopes and plans for democratic decentralisation in Indonesia are a series of assumptions about the availability, adequacy and use of statistical data, both locally and nationally. While the government does not question the need for data to define welfare needs, it has yet to clarify the mechanisms by which information can be generated and transmitted to relevant decision makers in a democratic and decentralised Indonesia. This paper argues the need to restructure and strengthen national statistical collections. At the outset of decentralisation the major statistical organisations were seriously under-funded, and most line departments were burdened with contradictory and inefficient approaches to the collection of operational and financial information for planning and monitoring. Without significant and immediate reform, the information Indonesia needs to develop the economy and the new democratic polity will deteriorate in quantity and quality.     

Social Transfer Benefits and Retirement Decisions: Evidence from South Africa

Population aging poses a new challenge to the fiscal sustainability of social security programs around the globe. As life expectancy increases, among other reasons, many governments in developed countries have begun to reform key features of their programs, such as increasing the eligibility age for access to social benefits. However, as in the case of South Africa, some opt to decrease the eligibility age for access to such pension benefits. The South African old age pension, which is one of the most expansive cash transfers in developing countries, puts a significant monthly cash transfer in the hands of its recipients. This cash transfer is conditioned on age and a means test that is very generous to most South Africans. In this paper, we seek to understand the impact of such an increase in non‐labour income on the labour force participation of older men by exploiting a phased‐in reduction in pension eligibility age. We estimate that, at the median predicted market wage, pension age‐eligibility reduces the probability of labour force participation by approximately 9.85% points for single males and 15.45% points for married males.     

Social democracy and market reform in Australia and New Zealand

Social democratic governments in Australia and New Zealand adoptedpolicies of radical free-market reform, including financialderegulation, privatization, and public-sector reform in the1980s. Because of the absence of institutional obstacles togovernment action, reform was faster and more comprehensivein New Zealand than in Australia. The New Zealand reforms wereassociated with increasing inequality and generally poor economicoutcomes. There is nothing in the New Zealand experience tosupport the view that radical free-market economic policiesare consistent with social democratic welfare policies or withsocial democratic values of concern for the disadvantaged. TheAustralian reforms were less radical, and were accompanied bysome refurbishment of the welfare state. Economic performancedid not improve, as anticipated by advocates of reform, butwas considerably better than that of New Zealand.     

当代中国收入分化的现状及主要原因

中国在现代化进程中面临着一些现代性问题的困扰,其中,贫富分化成为社会矛盾的焦点之一。改革开放以来,中国居民生活水平得到整体提升,但也出现了结构上的分化。造成贫富差距的原因是复杂多重的。其中,城乡二元体制造成了城乡资源分配不公和收入差距,垄断行业的存在则使得资源在少部分群体中集聚,加深了贫富之间的鸿沟。此外,中国的社会保障制度没能充分发挥其调节作用,使得部分底层群体无法解决温饱问题,造成"极贫"群体的出现。值得关注的是,单位体制下的既得利益者,在住房制度改革后又获得福利性住房,住房不公平由此产生财产不公平。国家对于不断拉大的收入差距主要采取宏观政策加以调控,改革财税制度和完善社会保障同时进行,但这并不能因此改变由城乡二元体制和垄断等所带来的必然结果,因而只能起到局部调节收入差距的效果,不能实现真正的社会公正。     

Poverty in a Wealthy Economy: the Case of Nigeria

This paper describes the nature and evolution of poverty inNigeria between 1985 and 1992. It begins with the potentialwealth of Nigeria's oil economy and examines how the economicpolicies pursued in the 1980s and 1990s impacted economic growthand welfare. It then presents a profile of poverty in both 1985and 1992 according to different socioeconomic characteristicsof the country's population. The headcount measure of povertyin Nigeria declined from 43 to 34% between 1985 and 1992, primarilydue to a 34% increase in mean per capita household expenditures.The benefits of growth were not shared equally throughout thecountry. The bottom 18% of the income distribution had a lowerstandard of living in 1992 compared with 1985 by any measure.However, all other income groups had a higher standard of livingin 1992. Household expenditure growth was fastest in the southernand middle zones of the country, but it was much slower in thenorthern zone. Poverty in Nigeria, in addition to its overwhelminglyrural and regional characteristics, is also strongly influencedby education, age and the nature of employment. Those withoutan education constitute a large fraction of the poor and theextreme poor. Decomposing the factors causing the reductionin poverty shows that the overall decline of 8.9% was the netresult of a 13.6% decline due to the growth factor and a 4.7%increase due to the income distribution factor. Based on thisanalysis, the paper proposes that promoting broad-based growthand targeted interventions in health, education and infrastructureneed to be central strategies in the fight against poverty inNigeria.     

Health insurance generosity and conditional coverage: Evidence from medicaid managed care in Kentucky

This article estimates the impact of the introduction of Medicaid managed care (MMC) on the formal Medicaid participation of children. We employ a quasi‐experimental approach exploiting the location‐specific timing of MMC implementation in Kentucky. Using data from the March Current Population Survey from 1995 to 2003, our findings suggest that the introduction of MMC increases the likelihood of being uninsured and decreases formal Medicaid participation. This finding is consistent with an increase in “conditional coverage,” waiting until medical care is needed to sign up or re‐enroll in Medicaid. These effects are concentrated among low‐income children and absent for high‐income children. We find no evidence of “crowd‐in,” substituting private coverage for Medicaid. These results are robust to multiple placebo tests and imply the potential for less formal participation (i.e., more conditional coverage) among the Affordable Care Act‐Medicaid expansion population (which is likely to be primarily covered under MMC) than is typically predicted.     

SNAP and Paycheck Cycles

It is well documented that individuals do not spend the Supplemental Nutrition Assistance Program (SNAP) benefits smoothly over the month after receipt. Rather, recipients spend a disproportionate share of benefits at the beginning of the benefit month. This has costs for recipients and stores. There is also evidence that other income streams, such as Social Security and paychecks, are not spent smoothly. The presence of these other income streams may bias estimates of the effects of this SNAP cycle on consumption for working SNAP beneficiaries and those who receive other government benefits. We use data from United States Department of Agriculture's National Household Food Acquisition and Purchase Survey to explore how the SNAP cycle is affected by accounting for these other income streams. We find suggestive evidence that the cycle is more pronounced for workers who are paid on a weekly or monthly basis, but little evidence that cycles in other income streams mitigate or exacerbate the SNAP cycle.     

REVISITING SOUTH AFRICAN EMPLOYMENT TRENDS IN THE 1990S

This article revisits South African employment trends recorded since 1995. In particular, it investigates whether the job losses and gains recorded by the October Household Survey jobs in the mid-1990s reflect the reality. This is done by comparing the different official data sets, and by exploring alternative sources of information for three sectors that substantially influenced this trend, namely formal agriculture, mining, and community, social and personal services. Potential inconsistencies within the October Household data are assessed, particularly in relation to the distribution of employees across formal and informal sectors and the categorisation of unpaid family workers. The implications of possible changes to the employment trend from 1995-2006 are considered. This article finds that the evidence is strong enough to call into question published employment trends. According to the October Household Survey, formal employment fell by 1.4 million between 1995 and 1997. The OHS and Labour Force Survey shows that formal employment then grew by 1.9 million between 1997 and 2006. According to the revised figures presented in this paper, 73,000 to 530,000 formal jobs were lost between 1995 and 1997 and 1.4 million net new jobs were created between 1997 and 2006. It is therefore possible that the plummeting and "recovery" of employment in the 1990s were both considerably less dramatic than that reflected in the official statistics. Further research and investigation would be required to validate these trends.     

EVALUATING THE GENERAL EQUILIBRIUM EFFECTS OF A WAGE SUBSIDY SCHEME FOR SOUTH AFRICA

Unemployment among semi‐ and unskilled labour has reached severe proportions (over 50%) and threatens the political and economic stability of the South African economy. In this paper a computable general equilibrium (CGE) model of the South African economy is used to assess the effectiveness of a wage subsidy in raising employment of semi‐ and unskilled workers. We find that employment of semi‐ and unskilled workers can be raised quite significantly. Further, the wage subsidy schemes compares favourably with alternative welfare grant schemes in terms of employment growth. However, the results are sensitive to the targeting of sectors and the substitutability between labour of different skill levels.     

Fiscal and Welfare Effects of Balanced-budget Reforms of Korea’s National Pension System

This paper evaluates the fiscal sustainability of the benchmark pension system in Korea, which will come into effect in 2028 following the 2007 pension reforms, and the welfare effects of pension reforms aimed at a balanced budget over the life cycle. To this end, we measure the lifetime pension deficit, i.e. the difference between total pension benefits and total pension contributions in an individual’s lifetime. We find that the benchmark pension system is expected to run an average lifetime deficit of 22.36 million won (approximately $22,360), and the current pension fund is unlikely to finance the sum of future deficits. The optimal pension reform for the zero average lifetime deficit reduces social welfare by as much as a 2.06% fall in consumption and is characterised with the contribution rate of 20.3% and an average replacement rate of 66.4%. These values are much higher than the respective benchmark values, 9% and 40%, because the increase in pension benefits, combined with the increase in pension contributions, can reduce the income inequality due to the progressivity of pension benefits and the proportionality of pension contributions.     

减税降费有助于缩小中国家庭经济不平等吗——来自2011年个税改革的证据

共同富裕要求我们从多维视角审视物质层面的不平等，在当前减税降费的大背景下，个人所得税是调控收入分配的关键手段。文章从收入、消费和财产所构成的多维经济不平等视角出发，对2011年个人所得税改革调节家庭经济不平等的效应进行了探讨。研究发现：个人所得税改革的公平效应是显著的，使经济不平等程度下降了13.64%，其中对城市地区的调节效应更强，对低福利阶层和高福利阶层的影响相对显著。在作用机制方面，个人所得税改革主要影响收入不平等，并进一步作用于消费不平等和财产不平等，最终影响经济不平等。为充分发挥个人所得税的调节效应，应逐步提高个人所得税比重，补充和细化专项附加扣除项目与标准，逐步以家庭为基础征收个税。     

乡村民主建设的文化羁绊及对策

改革开放以来,我国乡村民主建设取得了巨大成绩,但也存在不少问题,诸如民主意识还不够高、程序操作不够规范、法治意识普遍不强、经济管理不够民主等。究其原因,无疑是错综复杂的,而从文化的视角考察,主要有消极＂亚文化＂沉渣泛起、乡民＂原子化＂意识抬头、乡村封建伦理的流毒和影响、村民骨子里的自卑心理等因素的存在和交织。因此,要进一步促进乡村民主政治建设,就必须大力加强社会主义道德观宣传,切实加强乡村法治建设,努力发展乡村教育和福利事业,挖掘、汲取乡村习俗精华,适时转变乡镇政府职能,充分发挥乡村人才的积极作用,等等。     

The Impact of Research and Development on Economic Growth and Productivity in the U.S. States

Research and development (R&D) has a large effect on both state output and total factor productivity in the long run. Our estimates for the private sector of the U.S. states from 1963 to 2007 show that the R&D elasticity averages 0.056–0.143. The implied returns to state Gross Domestic Product (GDP) from R&D spending are 82–211%. There are also positive R&D spillovers, with 70–80% of the total returns accruing to other states. We also find that states with more human capital have higher own‐ and other‐R&D elasticities, and those in lowest tier of economic development have the least own‐state R&D elasticity but the highest other‐R&D elasticity. In addition, we find that the positive effect of R&D spillovers across states is larger when we consider R&D spillovers across states based on economic similarity of R&D across sectors.     

SOURCES OF INCOME DIFFERENCES ACROSS CHINESE PROVINCES DURING THE REFORM PERIOD: A DEVELOPMENT ACCOUNTING EXERCISE

The present paper performs a development accounting analysis to investigate the sources of China's interprovincial income inequality over the period 1982–2005. We estimate a Cobb–Douglas aggregate production function with various specifications. Using the estimated parameters, we conduct a development accounting analysis as well as a variance decomposition. Our results suggest that differences in physical capital intensity and in total factor productivity are both important sources of cross‐province income differences, each accounting for roughly half of the variation in income levels. Differences in human capital explain only a small amount of income differences across provinces. The results are robust to whether or not the assumption of constant returns to scale is imposed. The interaction between factor accumulation and total factor productivity is also discussed.     

Non-monetary dimensions of well-being in South Africa, 1993–2004: A post-apartheid dividend?

Existing studies on shifts in income welfare in South Africa since the demise of apartheid suggest that income inequality increased, while headcount poverty rates declined since 2000, after some evidence of an increase or no change in poverty in the 1995–2000 and 1996–2001 periods. This study provides an analysis of the shifts in non-income welfare that have occurred in South Africa between 1993 and 2004. We use factor analysis to construct an asset index as a measure of non-income-based welfare. Variables reflecting household access to a range of services and assets are used in the construction of the index. Significantly different results emerge when non-income welfare shifts are considered: we show statistically significant decreases in the headcount asset poverty rates between 1993 and 2004 across a range of covariates. Finally, asset inequality decreased significantly between 1993 and 2004 – in stark contrast to results based on consumption data.