Measuring Potential Output and Output Gap and Macroeconomic Policy: The Case of Kenya

Measuring the level of an economy.s potential output and output gap are essential in identifying a sustainable non-inflationary growth and assessing appropriate macroeconomic policies. The estimation of potential output helps to determine the pace of sustainable growth while output gap estimates provide a key benchmark against which to assess inflationary or disinflationary pressures suggesting when to tighten or ease monetary policies. These measures also help to provide a gauge in the determining the structural fiscal position of the government. This paper attempts to measure Kenya.s potential output and output gap using alternative statistical techniques and structural methods. Estimation of potential output and output gap using these techniques shows varied results. The estimated potential output growth using different methods gave a range of .2.9 to 2.4 percent for 2000 and a range of .0.8 to 4.6 for 2001. Although various methods produce varied results, they however provided a broad consensus on the over-all trend and performance of the Kenyan economy. This study found that firstly, potential output growth is declining over the recent time and secondly, the Kenyan economy is contracting in the recent years.

Measuring Unemployment Insurance Generosity

In this paper, we develop a methodology to summarize the various policy parameters of an unemployment insurance scheme into a single generosity parameter. Unemployment insurance policies are multdimensional objects. They are typically defined by waiting periods, eligibility duration, benefit levels and asset tests when eligible, which makes intertemporal or international comparisons difficult. To make things worse, labor market conditions, such as the likelihood and duration of unemployment matter when assessing the generosity of different policies. We build a first model with such complex characteristics. Our model features heterogeneous agents that are liquidity constrained but can self-insure. We then build a second model that is similar, except that the unemployment insurance is simpler: it is deprived of waiting periods and agents are eligible forever with constant benefits. We then determine which level of benefits in this second model makes agents indifferent between both unemployment insurance policies. We apply this strategy to the unemployment insurance program of the United Kingdom and study how its generosity evolved over time.

Measuring Middle School Achievement Growth With Student Growth Percentile Methodology

This study examined reading and mathematics achievement growth for middle school students over three years using statewide test scores using student growth percentile methodology (Betebenner, 2008). This newly-emerging growth methodology provides a basis for examining growth normatively (“what is”) in order to provide a foundation for policies about adequate growth (“what should be”) and excellent growth (“what could be”). Growth is compared among student subgroups and different middle schools. A particular focus of the study is identifying typical growth trajectories of low-achieving 6th graders through the middle school years.

Measuring the quality of life of patients with diabetes: Validating the tool and determining the effects on quality of life

There are several tools for measuring quality of life (QoL) and specifically, health-related quality of life (HRQoL) for persons with diabetes. A commonly-used measure, the Diabetes Quality of Life (DQOL) Survey, developed for the Diabetes Control and Complications Trial (DCCT), has been used in several experimental settings, and its reliability and validity are well-established. However, it is considered too long to be of practical use in clinical settings. Because of this, a shortened version of the tool was used recently in the Community Diabetes Education (CoDE) Project in Dallas, Texas, a clinic-based patient education program that uses a specially-trained community healthcare worker to provide patient education. However, the modified scale has never been tested for reliability and validity. Thus, one goal of this thesis was to measure these psychometric properties of the scale. After establishing the reliability and validity, the results of the scale were analyzed to determine the effects of the intervention on the subjects’ quality of life. The changes in QoL scales were compared with changes in physiologic measures which are most closely allied with diabetes, including blood glucose levels, weight/BMI, co-morbidities and health beliefs in order to determine if there is a relationship between such measures and quality of life. The results of the reliability and validity testing were not conclusive. Measures of reliability and criterion validity were established, but these contrasted with poor measures of repeatability and content validity. The effect of the intervention on quality of life, however, was more significant, particularly regarding the impact of diabetes. Those who received the counseling had significantly higher scores on the Impact scale than those who did not, and the former group had much greater improvement in scores over the twelve month period than the latter group. ^

The Open Door Mission: Measuring and predicting outcomes of one community-based substance abuse treatment program

The objectives of this study were to identify and measure the average outcomes of the Open Door Mission's nine-month community-based substance abuse treatment program, identify predictors of successful outcomes, and make recommendations to the Open Door Mission for improving its treatment program.^ The Mission's program is exclusive to adult men who have limited financial resources: most of which were homeless or dependent on parents or other family members for basic living needs. Many, but not all, of these men are either chemically dependent or have a history of substance abuse.^ This study tracked a cohort of the Mission's graduates throughout this one-year study and identified various indicators of success at short-term intervals, which may be predictive of longer-term outcomes. We tracked various levels of 12-step program involvement, as well as other social and spiritual activities, such as church affiliation and recovery support.^ Twenty-four of the 66 subjects, or 36% met the Mission's requirements for success. Specific to this success criteria; Fifty-four, or 82% reported affiliation with a home church; Twenty-six, or 39% reported full-time employment; Sixty-one, or 92% did not report or were not identified as having any post-treatment arrests or incarceration, and; Forty, or 61% reported continuous abstinence from both drugs and alcohol.^ Five research-based hypotheses were developed and tested. The primary analysis tool was the web-based non-parametric dependency modeling tool, B-Course, which revealed some strong associations with certain variables, and helped the researchers generate and test several data-driven hypotheses. Full-time employment is the greatest predictor of abstinence: 95% of those who reported full time employment also reported continuous post-treatment abstinence, while 50% of those working part-time were abstinent and 29% of those with no employment were abstinent. Working with a 12-step sponsor, attending aftercare, and service with others were identified as predictors of abstinence.^ This study demonstrates that associations with abstinence and the ODM success criteria are not simply based on one social or behavioral factor. Rather, these relationships are interdependent, and show that abstinence is achieved and maintained through a combination of several 12-step recovery activities. This study used a simple assessment methodology, which demonstrated strong associations across variables and outcomes, which have practical applicability to the Open Door Mission for improving its treatment program. By leveraging the predictive capability of the various success determination methodologies discussed and developed throughout this study, we can identify accurate outcomes with both validity and reliability. This assessment instrument can also be used as an intervention that, if operationalized to the Mission’s clients during the primary treatment program, may measurably improve the effectiveness and outcomes of the Open Door Mission.^

MEASURING THE EFFECT OF ILLNESS ON THE EXPECTED REMAINING SERVICE TIME FOR THE ACTIVE DUTY ARMY: A LIFE TABLE APPROACH

A life table methodology was developed which estimates the expected remaining Army service time and the expected remaining Army sick time by years of service for the United States Army population. A measure of illness impact was defined as the ratio of expected remaining Army sick time to the expected remaining Army service time. The variances of the resulting estimators were developed on the basis of current data. The theory of partial and complete competing risks was considered for each type of decrement (death, administrative separation, and medical separation) and for the causes of sick time.^ The methodology was applied to world-wide U.S. Army data for calendar year 1978. A total of 669,493 enlisted personnel and 97,704 officers were reported on active duty as of 30 September 1978. During calendar year 1978, the Army Medical Department reported 114,647 inpatient discharges and 1,767,146 sick days. Although the methodology is completely general with respect to the definition of sick time, only sick time associated with an inpatient episode was considered in this study.^ Since the temporal measure was years of Army service, an age-adjusting process was applied to the life tables for comparative purposes. Analyses were conducted by rank (enlisted and officer), race and sex, and were based on the ratio of expected remaining Army sick time to expected remaining Army service time. Seventeen major diagnostic groups, classified by the Eighth Revision, International Classification of Diseases, Adapted for Use In The United States, were ranked according to their cumulative (across years of service) contribution to expected remaining sick time.^ The study results indicated that enlisted personnel tend to have more expected hospital-associated sick time relative to their expected Army service time than officers. Non-white officers generally have more expected sick time relative to their expected Army service time than white officers. This racial differential was not supported within the enlisted population. Females tend to have more expected sick time relative to their expected Army service time than males. This tendency remained after diagnostic groups 580-629 (Genitourinary System) and 630-678 (Pregnancy and Childbirth) were removed. Problems associated with the circulatory system, digestive system and musculoskeletal system were among the three leading causes of cumulative sick time across years of service. ^

The Need for Balanced Methods of Measuring Performance

Michelle Rhee weighs in on measuring success in pubic education.

Measuring Success in Public Education: Whether Wanted or Not

Robert Sanborn and Angelo Giardino's introduction for Volume 3, Issue 2: Measuring Success in Public Education.

Measuring Service Effectiveness for Families

While most professionals do not dispute the fact that evaluation is necessary to determine whether agencies and practitioners are truly providing services that meet clients’ needs, information regarding consistent measures on service effectiveness in human service organizations is sparse. A national survey of 250 not-for-profit family service organizations in the United States (52.8% return rate) yielded results relevant to client identified needs and agency effectiveness measures in serving today’s families. On an open-ended survey item, 52.3% agencies indicated that poverty represented the most pressing problem among today’s families because other psychological needs also take priority. Over two thirds of these agencies used multiple methods to evaluate their services. Clients’ feedback and outcome measures are the most popular methods. The findings reveal agencies' difficulties in determining what or who decides if the most appropriate services are being provided for the target population. Limited data collected on outcomes and impact may impose additional difficulties in program design and planning.

Measuring value in cancer-related health care: A case study in head and neck cancer

In the current climate of escalating health care costs, defining value and accurately measuring it are two critical issues affecting not only the future of cancer care in particular but also the future of health care in general. Specifically, measuring and improving value in cancer-related health care are critical for continued advancements in research, management, and overall delivery of care. However, in oncology, most of this research has focused on value as it relates to insurance industry and payment reform, with little attention paid to value as the output of clinical interventions that encompass integrated clinical teams focusing on the entire cycle of care and measuring objective outcomes that are most relevant to patients. ^ In this study, patient-centered value was defined as health outcomes achieved per dollar spent, and calculated using objective functional outcomes and total care costs. The analytic sample comprised patients diagnosed with three common head and neck cancers—cancer of the larynx, oral cavity, and oropharynx—who were treated in an integrated tertiary care center over an approximately 10-year period. The results of this study provide initial empirical data that can be used to assess and ultimately to help improve the quality and value of head and neck cancer care, and more importantly they can be used by patients and clinicians to make better-informed decisions about care, particularly what therapeutic services and outcomes matter the most to patients.^

Measuring Fiscal Decentralization in the Philippines

This paper focuses on the fiscal decentralization in the Philippines after the 1991 Local Government Code. It first examines the intergovernmental fiscal relationship between central and local governments by using fiscal decentralization indicators, and then investigates its impact on local finance. After fiscal decentralization, the local expenditure responsibility is expanded while the local fiscal capacity is not strengthened in the Philippines. Local governments consequently comes to depend heavily on fiscal transfers from the central government, internal revenue allotments (IRAs), which has a substantial influence on local finance. The heavy dependence on IRAs makes local finance unpredictable and unstable. The distribution of IRAs also affects the horizontal balance between provincial governments.

Measuring fixed costs for firms' use of a free trade agreement : threshold regression approach

In this paper, by employing the threshold regression method, we estimate the average tariff equivalent of fixed costs for the use of a free trade agreement (FTA) among all existing FTAs in the world. It is estimated to be 3.2%. This global estimate serves as a reference rate in the evaluation of each FTA’s fixed costs.

Measuring global value chains and regional economic integration : an international input-output approach

Firms that are expanding their cross-border activities, such as vertical specialization trade, outsourcing, and fragmentation productions, have brought dramatic changes to the global economy during the last two decades. In an attempt to understand the evolution of the interaction among countries or country groups, many trade-statistics-based indicators have been developed. However, most of these statistics focus on showing the direct trade-specific-relationship among countries, rather than considering the roles that intercountry and interindustrial production networks play in a global economy. This paper uses the concepts of trade in value added as measured by the input–output tables of OECD and IDE-JETRO to provide alternative indicators that show the evolution of regional economic integration and global value chains for more than 50 economies. In addition, this paper provides thoughts on how to evaluate comparative advantages on the basis of value added using an international input–output model.

Measuring smile curves in global value chains

The concept and logic of the "smile curve" in the context of global value chains has been widely used and discussed at the individual firm level, but rarely identified and investigated at the country and industry levels by using real data. This paper proposes an idea, based on an inter-country input-output model, to consistently measure both the strength and length of linkages between producers and consumers along global value chains. This idea allows for better identification and mapping of smile curves for countries and industries according to their positions and degrees of participation in a given conceptual value chain. Using the 1995-2011 World Input-Output Tables, several conceptual value chains are investigated, including exports of electrical and optical equipment from China and Mexico and exports of automobiles from Japan and Germany. The identified smile curves provide a very intuitive and visual image, which can significantly improve our understanding of the roles played by different countries and industries in global value chains. Further, the smile curves help identify the benefits gained by these countries and industries through their participation in global trade.