increasing the incomes of the poor by a higher percentage than the incomes of the rich. Moreover, the administrative cost can sometimes be much lower for a market-wide food subsidy than for an incometransferprogram aimed at specific target groups, and a mass subsidy reaches more of the target population.
Subsidizing food prices for all consumers is clearly more costly for the government budget than subsidizing food prices for target groups. Such policies generally require heavy involvement of the government in the wholesale food trade. The government must manage a two
International Monetary Fund. Western Hemisphere Dept.
been preserved. Although challenging, the approval of the social security reform would represent a breakthrough for fiscal sustainability and would create space for means-tested incometransferprograms. Under difficult conditions, the authorities have intensified their efforts to gather political and public opinion support to the proposition as it requires a 60 percent qualified majority in each house of Congress.
9. The fiscal situation in a few states is challenging . While the fiscal condition of most states is manageable, some require sharp adjustment, in
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interest bill, additional spending on goods and services, and an increase in incometransferprograms.
The overall balance of payments deteriorated significantly in 2015 despite an improvement in the terms of trade. The current account deficit was contained at 2.5 percent of GDP in 2015—the same level as in 2014. Capital flows have also been a key driving force behind the deterioration in the balance of payments. The capital and financial account position has weakened due to foreign exit from government securities, lower FDI inflows, and slow implementation of
Mr. Alexander D Klemm, Ms. Li Liu, Victor Mylonas, and Mr. Philippe Wingender
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Michal Andrle, Mr. Shafik Hebous, Mr. Alvar Kangur, and Mr. Mehdi Raissi
lungo periodo del sistema pensionistico e socio-sanitario ,” Department of the State Accountant General, Ministry of Economy and Finance, Report No. 18 ( September ).
Saez , E. , Slemrod , J. , and Giertz , S. , 2002 , “ Optimal IncomeTransferPrograms: Intensive versus Extensive Labor Supply Responses ,” Quarterly Journal of Economics , Vol. 117 , pp. 1039 – 1073 . 10.1162/003355302760193959
Settergren , O. and D.B. Mikula , 2006 , “ The Rate of Return of Pay-As-You-Go Pension Systems: A More Exact Consumption-Loan Model of Interest
Aged, 1980,” Social Security Bulletin , January 1983; current population surveys, March 1985.
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Mr. Sanjeev Gupta, Mr. Alex Segura-Ubiergo, and Enrique Flores
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Saez , Emmanuel , 2000 , “ Optimal IncomeTransferPrograms: Intensive versus Extensive Labor Supply Responses, ” NBER Working Paper No. 7708 ( Cambridge, Massachusetts : National Bureau of Economic Research ).
Sala-i-Martin , X. , and A. Subramanian , 2003 , “ Addressing the Natural Resource Curse: An Illustration from Nigeria, ” NBER Working Paper 9804 ( Cambridge, Massachusetts : National Bureau of Economic Research ).
Salehi-Isfahani , D. , B.W. Stucki
KATHIE KRUMM, BRANKO MILANOVIC, and MICHAEL WALTON
—will suffer disproportionately over the medium-to-long term, as well as in the short term.
This article is drawn from the authors’ World Bank Policy Research Working Paper No. 1380, “Transfers and the Transition from Socialism: Key Tradeoffs,” which was issued in November 1994 .
Further reading: Francois Bourguignon, “Optimal Poverty Reduction, Adjustment, and Growth,” World Bank Economic Review, Vol. 5 (May 1991), pp. 315-38; Sheldon Danziger and others, “How IncomeTransferPrograms Affect Work, Savings, and the Income Distribution: An Overview,” Journal of