Assessing the distributional impact of public policy

B. Essama-Nssah

No 2883, Policy Research Working Paper Series from The World Bank

Abstract: Economic development necessarily changes the welfare of socioeconomic groups to various degrees, depending on differences in their social arrangements. The challenge for policymakers is to select the changes that will be most socially desirable. The author demonstrates the usefulness of distributional analysis for social evaluation and, more specifically, for welfare evaluation, using data from the 1994 Integrated Household Survey in Guinea. Because the international community has declared poverty eradication a fundamental objective of development, the author uses a poverty-focused approach to social evaluation based on the maximum principle. This principle offers a unifying framework for analyzing the socioeconomic impact of public policy by using a wide variety of evaluation functions, inequality indicators (like the extended Gini coefficient), and poverty indices (such as Sen's index and the members of the Foster-Greer-Thorbecke family). The author also examines, within the context of commodity taxation, how to identify socially desirable policy options using both the dominance criterion and abbreviated social welfare functions. He includes computer routines for calculating various welfare indices and for plotting the relevant concentration curves.

Keywords: Economic Theory&Research; Health Economics&Finance; Public Health Promotion; Poverty Impact Evaluation; Environmental Economics&Policies; Poverty Assessment; Economic Theory&Research; Inequality; Poverty Impact Evaluation; Health Economics&Finance (search for similar items in EconPapers)
Date: 2002-09-30
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Citations: View citations in EconPapers (2)

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