A Consistent Poverty Approach to Assessing the Sensitivity of Income Poverty Measures and Trends

This paper examines the sensitivity of estimates of income poverty rates and trends to variations in the poverty line and to whether or not certain households are included or excluded from the sample used to estimate poverty. The approach draws on the concept of consistent poverty, which has been used to identify those with incomes below the poverty line who also experience deprivation. Our approach involves excluding households with incomes below the poverty line if they report zero or negative income or are self‐employed, have expenditure well in excess of their income, have substantial wealth holdings, or if they do not report having experienced financial stress over the past year. The combined impact of all four exclusions is to reduce the half‐median income poverty rate from 9.9 per cent to 5.4 per cent, but also suggests that poverty increased by more over the decade to 2003–04 than the original estimates indicate.     

How road improvement reduces poverty: the case of Laos

A general equilibrium modeling approach is used to study the effect that rural road improvement has on poverty incidence in Laos. Household survey data are used to distinguish three categories of rural villages according to their road access: (i) no vehicular access; (ii) dry season only access; and (iii) all weather access. A general equilibrium model of the Lao economy is then used to simulate, first, the effect of upgrading category (i) to category (ii) roads, and second, category (ii) to category (iii) roads. The former has a larger poverty‐reducing effect but is also more costly.     

Supplier strategy and customer responsiveness: Managing the links

Responsiveness to the customer is a fine ideal. Making it a reality is increasingly critical to gaining competitive advantage. In practice, it often means more variety at shorter notice. Faced with these challenges, companies must look to their suppliers for support. Instant market intelligence and flexible manufacturing are worth little if they face bottlenecks in getting the right supplies. Becoming customer responsive therefore starts with supplier strategy. Success requires better ways of managing the commercial links.     

Living Decently

One of the reasons why poverty lines became popular at the turn of the century was their promise of a scientific technique that would dispense with moralising about poverty. We argue that a price paid in this quest has been an impoverishment of the richness of the notion of 'a decent life', the moral concept underlying poverty. In addition, poverty lines have in practice been more to do with inequality at the bottom end of the income distribution than with poverty. The purpose of this article is to rehabilitate the measurement of poverty, and to make it credible. We set out our preferred method of poverty measurement, and illustrate it using data from the Australian Standard of Living Study. A feature of our approach is to distinguish clearly between issues of inequality and issues of poverty. Questions such as who is on the bottom of the income distribution, whether this has changed over time, and how income levels of the worst off compare with the mean, are questions of inequality. As such, the answers tell us nothing at all about how the worst off are actually living. To answer that question, we require direct measures of consumption and of social participation. These measures are not as simple, but they provide us with knowledge about poverty that poverty lines have promised, but have not delivered in a credible fashion.     

Determination of the labour/capital multiplier of a typical modern irrigation scheme in South Africa∗

Methodology developed by the Central Economic Advisory Service was applied to gain greater insight into job creation benefits of a typical modern irrigation project. The evaluation method uses all relevant information available from economic feasibility analysis and relies on broad sectoral multipliers only where no better data are at hand. It is shown that contrary to current opinions based on broad sectoral aggregates, irrigation schemes do not necessarily exhibit above‐average job‐creasion advantages.     

Earnings management surrounding CEO changes

This paper investigates the extent of earnings management in the periods surrounding CEO changes by Australian firms. Evidence is presented of incoming CEOs undertaking earnings management to reduce income in the year of CEO change, with abnormal and extraordinary items being the primary vehicle through which this is achieved. This result is consistent with the notion of new CEOs engaging in an 'earnings bath', and is strongest for non–routine CEO changes, where the opportunities to manage earnings are greatest. Extending prior work, classification of CEO changes as routine or non–routine is based on an expanded information search, and this provides insights into the CEO change process and identifies problems with simpler mechanistic classification methods. Additionally, detailed information of the operation of the modified Jones model for estimating expected accruals is presented, and this is consistent with such models having low explanatory power in identifying abnormal accruals.