Developments in social accounting methods as applied to the analysis of income distribution and employment issues

Research into the design, construction and use of social accounting matrices (SAMs) for the analysis of income distribution issues in development policy and planning is generally discussed. Specific case studies for Swaziland, Botswana and Kenya are considered and the accounting classifications are compared, especially those for households. The use of the Swaziland and Botswana SAMs to analyse some of the distributional effects of certain exogenous impacts (such as the outbreak of a foot and mouth epidemic in Botswana) is also discussed. This includes a presentation of methodology as well as some results of the analyses.     

Government financing decisions and asset returns

This paper presents an empirical investigation of the relation between government financing decisions and asset returns. In particular, the focus is on whether a substitution of debt financing for tax financing of a given level of expenditures is associated with an increase in interest rates. The paper brings a different perspective to empirical investigations of government fiscal policies by examining the response of asset prices in an efficient capital market to such policies rather than focusing on aggregate consumption behavior. The results are consistent with the idea that asset prices are unrelated to how the government finances its expenditures. The results, however, also indicate that the capital market is not indifferent with respect to the level of government expenditures as higher interest rates are associated with increases in government purchases.     

RISK,UTILITY AND STOCKING RATE*

A simple utility-based model of risky wool production is presented. Evaluation of the model indicates the effect on optimal stocking rate of changes in the degree of risk aversion, farm area, variable cost, fixed cost, wool cut, wool price, variance of wool price, climatic variability and tax rate. It is shown that the utility hypothesis implies a lower optimal stocking rate than does expected profit maximization and hence implies a discrepancy between private and public optimal resource use which it is suggested, might be mitigated by a progressive bounty on wool production.     

Performance signals in the public sector: the case of health care

Although there are no traditional markets and money prices inthe public sector, consumers and providers may respond to signalsof organisational performance. We present a simple dynamic modelof the demand and supply for elective surgery in the UK NationalHealth Service in which waiting time acts as the prime indicatorof performance. The model is tested using a panel of quarterlydata for 123 English health authorities over an eight-year period.We find that supply is increasing and demand is decreasing inmeasures of the previous period waiting time. The results implythat health care systems which are rationed by waiting do respondto indicators of waiting times. The paper adds to the smallbut consistent body of research which demonstrates that publicsector systems respond to important aspects of reported performance.