Tax reform under fiscal stress: a CGE analysis of the Brazilian tax reform

In spite of a general agreement over the distortion imposed by the current Brazilian tax system, attempts to reform it during the last decade have faced several restrictions to its implementation. Two of these restrictions were particular binding: a) fiscal adjustment restriction (public sector debt cannot increase), b) fiscal federalist restriction (revenues from individual states and municipalities cannot decrease). This paper focuses on a specific reform that overcomes in principle the fiscal federalist restriction. Using Auerbach and Kotlikoff (1987) model calibrated for the Brazilian economy, I analyze the short and long run macroeconomic effects of this reform subject to the fiscal adjustment restriction. Finally, I look at the redistributive effects of this reform among generations as a way to infer about public opinion’s reaction to the reform. The reform consists basically of replacing indirect taxes on corporate revenues, which I show to be equivalent to a symmetric tax on labor and capital income, by a new federal VAT. The reform presented positive macroeconomic effects both in the short and long run. Despite a substantial increase in the average VAT rate in the first years after the reform, a majority of cohorts experienced an increase in their lifetime welfare, being potentially in favour of the reform.

Creditor's protection and bank loans: lack of competition hamprers bankruptcy reform's effects

This dissertation investigates how credit institutions’ market power limits the effects of creditor protection rules on the interest rate and the spread of bank loans. We use the Brazilian Bankruptcy Reform of June/2005 (BBR) as a legal event affecting the institutional environment of the Brazilian credit market. The law augments creditor protection and aims to improve the access of firms to the credit market and to reduce the cost of borrowing. Either access to credit or the credit cost are also determined by bank industry competition and the market power of suppliers of credit. We derive a simple economic model to study the effect of market power interacting with cost of lending. Using an accounting and operations dataset from July/2004 to December/2007 provided by the Brazilian Central Bank, we estimate that the lack of competition in the bank lending industry hinders the potential reducing effect of the BBR on the interest rate of corporate loans by approximately 30% and on the spread by approximately 23%. We also find no statistical evidence that the BBR affected the concentration level of the Brazilian credit market. We present a brief report on bankruptcy reforms around the world, the changes in the Brazilian legislation and on some recent related articles in our introductory chapter. The second chapter presents the economic model and the testable hypothesis on how the lack of competition in the lending market limits the effects of improved creditor protection. In this chapter, we introduce our empirical strategy using a differences-in-differences model and we estimate the limiting effect of market power on the BBR’s potential to reduce interest rates and on the spread of bank loans. We use the BBR as an exogenous event that affects collateralized corporate loans (treatment group) but that does not affect clean consumer loans (control group) to identify these effects, using different concentration measures. In Chapter 3, we propose a two-stage empirical strategy to handle the H–Statistics proposed by Panzar and Rosse as a measure of market competition. We estimate the limiting effects of the lack of competition in replacing the concentration statistics by the H–Statistics. Chapter 4 presents a structural break test of the concentration index and checks if the BBR affects the dynamic evolution of the concentration index.

Regulatory reform in the brazilian railway sector and concession valuation: a preliminary assessment

Trabalho apresentado na 4th Conference on the Regulation of Infrastructures

Regulatory reform in the brazilian railway sector and its potential effects

Trabalho apresentado no Law and Society Annual Conference, 2015

Regulatory reform in the brazilian railway sector: a preliminary assesment

Escola de Direito do Rio de Janeiro da Fundação Getulio Vargas

The impact of social security reform on occupational and retirement behavior : a quantitative assessment for Brazil

Population ageing is a problem that countries will have to cope with within a few years. How would changes in the social security system affect individual behaviour? We develop a multi-sectoral life-cycle model with both retirement and occupational choices to evaluate what are the macroeconomic impacts of social security reforms. We calibrate the model to match 2011 Brazilian economy and perform a counterfactual exercise of the long-run impacts of a recently adopted reform. In 2013, the Brazilian government approximated the two segregated social security schemes, imposing a ceiling on public pensions. In the benchmark equilibrium, our modelling economy is able to reproduce the early retirement claiming, the agents' stationary distribution among sectors, as well as the social security deficit and the public job application decision. In the counterfactual exercise, we find a significant reduction of 55\% in the social security deficit, an increase of 1.94\% in capital-to-output ratio, with both output and capital growing, a delay in retirement claims of public workers and a modification in the structure of agents applying to the public sector job.

Essays on health care reform, wealth inequality, and demography

This thesis contains three chapters. The first chapter uses a general equilibrium framework to simulate and compare the long run effects of the Patient Protection and Affordable Care Act (PPACA) and of health care costs reduction policies on macroeconomic variables, government budget, and welfare of individuals. We found that all policies were able to reduce uninsured population, with the PPACA being more effective than cost reductions. The PPACA increased public deficit mainly due to the Medicaid expansion, forcing tax hikes. On the other hand, cost reductions alleviated the fiscal burden of public insurance, reducing public deficit and taxes. Regarding welfare effects, the PPACA as a whole and cost reductions are welfare improving. High welfare gains would be achieved if the U.S. medical costs followed the same trend of OECD countries. Besides, feasible cost reductions are more welfare improving than most of the PPACA components, proving to be a good alternative. The second chapter documents that life cycle general equilibrium models with heterogeneous agents have a very hard time reproducing the American wealth distribution. A common assumption made in this literature is that all young adults enter the economy with no initial assets. In this chapter, we relax this assumption – not supported by the data – and evaluate the ability of an otherwise standard life cycle model to account for the U.S. wealth inequality. The new feature of the model is that agents enter the economy with assets drawn from an initial distribution of assets. We found that heterogeneity with respect to initial wealth is key for this class of models to replicate the data. According to our results, American inequality can be explained almost entirely by the fact that some individuals are lucky enough to be born into wealth, while others are born with few or no assets. The third chapter documents that a common assumption adopted in life cycle general equilibrium models is that the population is stable at steady state, that is, its relative age distribution becomes constant over time. An open question is whether the demographic assumptions commonly adopted in these models in fact imply that the population becomes stable. In this chapter we prove the existence of a stable population in a demographic environment where both the age-specific mortality rates and the population growth rate are constant over time, the setup commonly adopted in life cycle general equilibrium models. Hence, the stability of the population do not need to be taken as assumption in these models.

Obsessive-compulsive disorder and personality disorder - Evidence from the British National Survey of Psychiatric Morbidity 2000

Background Previous studies indicate that most individuals with obsessive-compulsive disorder (OCD) have comorbid personality disorders (PDs), particularly from the anxious cluster. However, the nature and strength of this association remains unclear, as the majority of previous studies have relied heavily on clinical populations. We analysed the prevalence of screen positive personality disorder in a representative sample of adults with OCD living in private households in the UK. Methods A secondary analysis of data from the 2000 British National Survey of Psychiatric Morbidity. The prevalence of PD, as determined by the SCID-II questionnaire, was compared in participants with OCD, with other neuroses and non-neurotic controls. Within the OCD group we also analysed possible differences relating to sex and subtypes of the disorder. Results the prevalence of any screen positive PD in the OCD group (N = 108) was 74%, significantly greater than in both control groups. The most common screen positive categories were paranoid, obsessive-compulsive, avoidant, schizoid and schizotypal. Compared to participants with other neuroses, OCD cases were more likely to screen positively for paranoid, avoidant, schizotypal, dependent and narcissistic PDs. Men with OCD were more likely to screen positively for PDs in general, cluster A PDs, antisocial, obsessive-compulsive and narcissistic categories. The presence of comorbid neuroses in people with OCD had no significant effect on the prevalence of PD. Conclusions Personality pathology is highly prevalent among people with OCD who are living in the community and should be routinely assessed, as it may affect help-seeking behaviour and response to treatment.

Treatment seeking by individuals with obsessive-compulsive disorder from the British Psychiatric Morbidity Survey of 2000

Objective: For several reasons, many individuals with obsessive-compulsive disorder (OCD) do not seek treatment. However, data on treatment seeking from community samples are scant. This study analyzed service use by adults with OCD living in private households in Great Britain. Methods: Data from the British Survey of Psychiatric Morbidity of 2000, in which 8,580 individuals were surveyed, were analyzed. Service use was compared for those with OCD, with other neuroses, with different subtypes of OCD (only obsessions, only compulsions, or both), and with OCD and comorbid neuroses. Results: Persons with OCD (N=114) were more likely than persons with other neuroses (N=1,395) to be receiving treatment (40% compared with 23%, p<.001). However, those with OCD alone (N=38) were much less likely than those with OCD and a comorbid disorder to be in treatment (14% compared with 56%, p<.001). In the previous year, 9.4% of persons with OCD had seen a psychiatrist and 4.6% had seen a psychologist. Five percent were receiving cognitive-behavioral therapy, 2% were taking selective serotonin reuptake inhibitors, and 10% were taking tricyclics. Conclusions: Most persons with OCD were not in contact with a mental health professional, and apparently very few were receiving appropriate treatments. Very few persons with noncomorbid OCD were receiving treatment. Individuals with OCD who are in treatment may not be disclosing their obsessions and compulsions and may be discussing other emotional symptoms, leading to inappropriate treatment strategies. Public awareness of OCD symptoms should be raised, and primary care professionals should inquire about them with all patients who have depressive or anxiety disorders.

Obsessive-compulsive disorder: Prevalence, comorbidity, impact, and help-seeking in the British National Psychiatric Morbidity Survey of 2000

Objective: There is little information about obsessive-compulsive disorder in large representative community samples. The authors aimed to establish obsessive-compulsive disorder prevalence and its clinical typology among adults in private households in Great Britain and to obtain generalizable estimates of impairment and help-seeking.Method: Data from the British National Psychiatric Morbidity Survey of 2000, comprising 8,580 individuals, were analyzed using appropriate measurements. The study compared individuals with obsessive-compulsive disorder, individuals with other neurotic disorders, and a nonneurotic comparison group. ICD-10 diagnoses were derived from the Clinical Interview Schedule-Revised.Results: the authors identified 114 individuals (74 women, 40 men) with obsessive-compulsive disorder, with a weighted 1-month prevalence of 1.1%. Most individuals (55%) in the obsessive-compulsive group had obsessions only. Comorbidity occurred in 62% of these individuals, which was significantly greater than the group with other neuroses (10%). Co-occurring neuroses were depressive episode (37%), generalized anxiety disorder (31%), agoraphobia or panic disorder (22%), social phobia (17%), and specific phobia (15%). Alcohol dependence was present in 20% of participants, mainly men, and drug dependence was present in 13%. Obsessive-compulsive disorder, compared with other neurotic disorders, was associated with more marked social and occupational impairment. One-quarter of obsessive-compulsive disorder participants had previously attempted suicide. Individuals with pure and comorbid obsessive-compulsive disorder did not differ according to most indices of impairment, including suicidal behavior, but pure individuals were significantly less likely to have sought help (14% versus 56%).Conclusions: A rare yet severe mental disorder, obsessive-compulsive disorder is an atypical neurosis, of which the public health significance has been underestimated. Unmet need among individuals with pure obsessive-compulsive disorder is a cause for concern, requiring further investigation of barriers to care and interventions to encourage help-seeking.

Land reform in NE Brazil: a stochastic frontier production efficiency evaluation

O objetivo desse artigo é caracterizar as fontes da ineficiência técnica e alocativa em um conjunto de 308 beneficiários de um programa de reforma agrária de mercado, chamado Cédula da Terra;, distribuídos em cinco estados do Nordeste brasileiro. Estudos conduzidos por Buainain et al. (2002) mostraram existem poucas diferenças entre as características de beneficiários deste programa e dos programas tradicionais de reforma agrária por expropriação e que portanto, os resultados obtidos por este trabalho permitem visualizar as dificuldades enfrentadas pelos assentamentos no Brasil. Para medir eficiência, estimou-se uma função de produção potencial segundo a metodologia de Battese e Coelli (1995) e a partir disto, procurou-se explicar as razões da ineficiência (relativa) encontrada. Os resultados apontam para a existência de ineficiência técnica e alocativa que é identificada principalmente nas situações em que a presença de produção para consumo é elevada. Tratase de um resultado que revela a pouca maturidade da maioria dos lotes dos assentados do PCT e a dificuldade de superar as limitações impostas pela condição inicial de formação dos assentamentos de reforma agrária, principalmente na região nordeste do Brasil.

Legitimacy and context: Implications for public sector reform in developing countries

This article examines the interplay between legitimacy and context as key determinants of public sector reform outcomes. Despite the importance of variables Such as legitimacy of public institutions, levels of civic morality and socio-economic realities, reform strategies often fail to take such contextual factors into account. The article examines, first, relevant literature both conceptual and empirical, including data from the World Values Survey project. It is argued that developing countries have distinctive characteristics which require particular reform strategies. The data analysed shows that in Latin American countries, there is no clear Correlation between confidence in public institutions and civic morality. Other empirical studies show that unemployment has a negative impact on the level of civic morality, while inequality engenders corruption. This suggests that poorer and socio-economically stratified countries face greater reform challenges owing to the lack of legitimacy of public institutions. The article concludes that reforms should focus on areas of governance that impact on poverty. This will in turn help produce more stable outcomes. Copyright (C) 2008 John Wiley & Sons, Ltd.

The distribution of agricultural land and the question of agrarian reform in Brazil

Agrarian reform has long been an acute issue in Brazil, where the distribution of cultivable land is extremely unequal. The Land Statute adopted by the military in 1964 constituted a genuine reform programme, which, however, was never implemented as the government chose to modernize agriculture and expand cultivated areas. This has prevented the poorest from having access to the land.-from English summary