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Asia and Pacific > India

You are looking at 1 - 2 of 2 items for :

  • Type: Journal Issue x
  • Energy and the Macroeconomy x
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Cover IMF Working Papers
The Distributional Impact of a Carbon Tax in Asia and the Pacific
Cristian Alonso
and
Mr. Joey Kilpatrick
While a carbon tax is widely acknowledged as an efficient policy to mitigate climate change, adoption has lagged. Part of the challenge resides in the distributional implications of a carbon tax and a belief that it tends to be regressive. Even when not regressive, poor households could be hurt by a carbon tax, particularly in countries that rely heavily on carbon-intensive energy sources. Using household surveys, we study how a carbon tax may affect households in the Asia Pacific region, the main source of CO2 emissions. We document a wide range of country-specific policies that could be implemented to compensate households, reduce inequality, and build support for adoption.
Keywords:
Carbon pricing; Climate change; Compensation; Distributional effects; Inequality; means testing; Labor income; fiscal revenue; price of energy goods; carbon tax revenue; special administrative region; carbon pricing assessment tool; Carbon tax; Income; Household consumption; Consumption; Income inequality; Asia and Pacific; Global
Cover IMF Working Papers
The Distributional Effects of Government Spending Shocks in Developing Economies
Davide Furceri
,
Jun Ge
,
Mr. Prakash Loungani
, and
Mr. Giovanni Melina
We construct unanticipated government spending shocks for 103 developing countries from 1990 to 2015 and study their effects on income distribution. We find that unanticipated fiscal consolidations lead to a long-lasting increase in income inequality, while fiscal expansions lower inequality. The results are robust to several measures of income distribution and size of the fiscal shocks, to an alternative identification strategy, across expansions and recessions and across country groups (low-income countries versus emerging markets). An additional contribution of the paper is the computation of the medium-term inequality multiplier. This is on average about 1 in our sample, meaning that a cumulative decrease in government spending of 1 percent of GDP over 5 years is associated with a cumulative increase in the Gini coefficient over the same period of about 1 percentage point. The multiplier is larger for total government expenditure than for public investment and consumption (with the former having larger effect), likely due to the redistributive role of transfers. Finally, we find that (unanticipated) fiscal consolidations lead to an increase in poverty.
Keywords:
WP; government spending shock; Fiscal policy; Fiscal shocks; Inequality; Income distribution; inequality multiplier; net income inequality; government spending response; government-spending ratio; growth shock; government spending contraction; government expenditure forecast; Income inequality; Total expenditures; Public investment spending; Global; Sub-Saharan Africa