Welfare Effort and Poverty from the Monetary and Capabilities Approach: A Cross-Country Analysis in Latin American and the Caribbean (1990-2010)

There is abundant empirical evidence on the negative relationship between welfare effort and poverty. However, poverty indicators traditionally used have been representative of the monetary approach, excluding its multidimensional reality from the analysis. Using three regression techniques for the period 1990-2010 and controlling for demographic and cyclical factors, this paper examines the relationship between social spending per capita —as the indicator of welfare effort— and poverty in up to 21 countries of the region. The proportion of the population with an income below its national basic basket of goods and services (PM1) and the proportion of population with an income below 50% of the median income per capita (PM2) were the two poverty indicators considered from the monetarist approach to measure poverty. From the capability approach the proportion of the population with food inadequacy (PC1) and the proportion of the population without access to improved water sources or sanitation facilities (PC2) were used. The fi ndings confi rm that social spending is actually useful to explain changes in poverty (PM1, PC1 and PC2), as there is a high negative and signifi cant correlation between the variables before and after controlling for demographic and cyclical factors. In two regression techniques, social spending per capita did not show a negative relationship with the PM2. Countries with greater welfare effort for the period 1990-2010 were not necessarily those with the lowest level of poverty. Ultimately social spending per capita was more useful to explain changes in poverty from the capability approach.

Valuing the recreational benefits from the creation of nature reserves in Irish forests

Data from a large-scale contingent valuation study are used to investigate the effects of forest attributes on willingness to pay for forest recreation in Ireland. In particular, the presence of a nature reserve in the forest is found to significantly increase the visitors' willingness to pay. A random utility model is used to estimate the welfare change associated with the creation of nature reserves in all the Irish forests currently without one. The yearly impact on visitors' economic welfare of new nature reserves approaches half a million pounds per annum, exclusive of non-recreational values. (C) 2000 Elsevier Science B.V. All rights reserved.

Order Flow and the Monetary Model of Exchange Rates: Evidence from a Novel Data Set

We propose an exchange rate model that is a hybrid of the conventional specification with monetary fundamentals and the Evans–Lyons microstructure approach. We estimate a model augmented with order flow variables, using a unique data set: almost 100 monthly observations on interdealer order flow on dollar/euro and dollar/yen. The augmented macroeconomic, or “hybrid,” model exhibits greater in-sample stability and out of sample forecasting improvement vis-à-vis the basic macroeconomic and random walk specifications.

Using Non-Monetary Deprivation Indicators to Analyze Poverty and Social Exclusion: Lessons from Europe?

Non-monetary indicators of deprivation are now widely used in studying poverty in Europe. While measuring financial resources remains central, having reliable information about material deprivation adds to the ability to capture poverty and social exclusion. Non-monetary indicators can help improve the identification of those experiencing poverty and understand how it comes about. They are most productively used when multidimensionality is explicitly taken into account, both in framing the question and in empirical application. While serious methodological and measurement issues remain to be addressed, material deprivation indicators allow for new insights in making poverty comparisons across countries and analyzing changes over time. (C) 2010 by the Association for Public Policy Analysis and Management.

The German Federal Constitutional Court's Ruling on Outright Monetary Transactions (OMT) - Another Step Towards National Closure?

The German Federal Constitutional Court (FCC) ruling of 14 January 2014 deserves a thorough evaluation on several accounts: It is the first ever reference by the FCC to the Court of Justice of the European Union (CJEU), it represents a continuation of FCC case law aimed at restricting the impact of European Union law as interpreted by the Court of Justices of the European Union (CJEU) on German law as well as questioning Germany’s participation in an ever closer European Union, and it has the potential to dictate the future course of the EU’s Economic and Monetary Union (EMU).

This case note discusses three aspects of this decision. First, it considers the aims of challenging the youngest measures to contain the euro currency crisis before the FCC, focusing on the question in how far the claims are based on national closure as opposed to an ever closer union of the peoples of Europe. Secondly it analyzes in how far the aims the claims pursue are reflected in the FCC’s response. Thirdly, it considers the substantive relevance of this reference, highlighting the surprisingly vague consequences the FCC envisages should the CJEU not re-interpret the OMT decision as the FCC suggests, and illuminating the strategic aims of the reference without deference. In conclusion, it sketches the remaining scope for the EU to engage in or at least facilitate transnational solidarity.

The G20 and Monetary Policy Stasis

Since the financial crash of 2008 monetary policy has been in a state of stasis – a condition in which things are not changing, moving, or progressing, but rather appear frozen. Interest rates have been frozen at low levels for a considerable period time. Inflation targets have consistently been missed, through phases of both overshooting and undershooting. At the same time, a variety of unconventional monetary policies involving asset purchases and liquidity provision have been pursued. Questions have been raised from a variety of sources, including various international organizations, covering distinct BIS and IMF positions about the continuing validity and sustainability of existing monetary policy frameworks, not least because inflation targeting has ceased to act as reliable guide for policy for over six years. Despite this central banks have been reluctant to debate moving to a new formal policy framework. This article argues that as an apex policy forum only the G20 leaders’ summits has the necessary political authority to call their central banks to account and initiate a wide ranging debate on the future of monetary policy. A case is made for convening a monetary policy working group to discuss a range of positions, including those of the BIS and IMF, and to make recommendations, because the G20 has been most effective in displaying international financial leadership, when leaders have convened and made use of specialist working groups.

The Monetary Value Of Meat Authenticity And Food Safety In Ready To Heat Lasagne: Implications Of The ‘Horse Meat Scandal’ Across Europe

The recent ‘horse meat scandal’ in Europe has sparked huge concerns among consumers, as horse meat was found in beef lasagne ready to be consumed. Within STARTEC, a European funded project, this study investigates consumers’ preferences, attitudes and willingness to pay (WTP) towards characteristics of ready to heat (RTH) fresh lasagne, including origin of the meat, tested for meat authenticity, safety of the lasagne, and nutritional value, using Discrete Choice Experiments in six countries - Republic of Ireland, France, Italy, Spain, Germany and Norway. Our representative sample of 4,598 European consumers makes this the largest cross country study of this kind. The questionnaire was administered online in January 2014. Results from models in WTP-space show that, on average, consumers are willing to pay considerable amount (about €4-9) for food authenticity; on this Irish and Italian are the least concerned while Spanish are the most concerned. As expected from discussing with stakeholders, food safety claims and nutritional value of the RTH lasagne are relatively less important. Consumers also value knowing the origin of ingredients preferring locally sourced meat. Primarily, the results of this study present strong evidence that consumers in Europe are highly concerned about authenticity of the meat in ready meals and strongly prefer to know that the meat is national. This evidence suggests that there is great value in providing information on these attributes, both from a consumer perspective and where this leads to an increased consumer confidence has benefits for the food industry.

Inflation targeting and the consistency of monetary policy decisions in Mexico: an empirical analysis with discrete choice models

This paper examines the nature of monetary policy decisions in Mexico using discrete choice models applied to the Central Bank's explicit monetary policy instrument. We find that monetary policy adjustments in Mexico have been strongly consistent with the CB's inflation targeting strategy. We also find evidence that monetary policy responds in a forward-looking manner to deviations of inflation from the target and that observed policy adjustments exhibit asymmetric features, with stronger responses to positive than to negative deviations of inflation from the target and a greater likelihood of policy persistence during periods when monetary policy is tightened, compared with periods when policy is loosened.