Community Education Needs to be Supported by Strong Public Policy to Tackle Food Poverty

Community education needs to be supported by strong public policy if it is to be fully effective at tackling food poverty and obesity, a project evaluation by the Institute of Public Health in Ireland (IPH) has found. In its evaluation of Decent Food for All (DFfA) - a major project to improve community diet and health - IPH found that where people live and shop had a greater impact on their diet than their own individual awareness and attitudes. Access Tackling Food Poverty: lessons from the Decent Food for All intervention at www.publichealth.ie DFfA was funded by safefood (the Food Safety Promotion Board) and the Food Standards Agency Northern Ireland. The project lasted four years and included hundreds of community education activities designed to improve diet in poorer parts of Armagh and South Tyrone. safefood commissioned IPH to undertake the evaluation of DFfA. Dr. Kevin Balanda, IPH Associate Director, said 'The aim of the project was to reduce food poverty (this is defined as not being able to consume adequate healthy food) and improve health in the target communities. DFfA delivered over 370 core activities to 3,100 residents including local education talks on diet, cookery workshops, fresh fruit in schools, healthy food tastings and information stands. One in eight residents in the target areas participated in at least one of these activities.' The evaluation found that over 1 in 5 adults in the target areas reported they had cut their weekly food spending in the last six months to pay other household bills such as rent, electricity and gas. During the four years of the DFfA activities, this percentage had not changed significantly. There were mixed changes in the nature of food in local stores. While the overall availability and price of food increased, both ﾓhealthierﾔ food and ﾓunhealthierﾔ food were included in that increase. It was only in the larger ﾓmultiple/discount freezerﾔ type of shops that the overall price of food had decreased.

Address by Michea¡l Martin to the Conference - Legislating for Tobacco Free Society

Thank you Chairman I would like to extend a warm welcome to our keynote speakers, David Byrne of the European Commission, Derek Yach from the World Health Organisation, and Paul Quinn representing Congressman Marty Meehan who sends his apologies. When we include the speakers who will address later sessions, this is, undoubtedly, one of the strongest teams that have been assembled on tobacco control in Europe. The very strength of the team underlines what I see as a shift – a very necessary shift – in the way we perceive the tobacco issue. For the last twenty years, we have lived out a paradox. It isn´t a social side issue. I make no apology for the bluntness of what I´m saying, and will come back, a little later, to the radicalism I believe we need to bring – nationally – to this issue. For starters, though, I want to lay it on the line that what we´re talking about is an epidemic as deadly as any suffered by human kind throughout the centuries. Slower than some of those epidemics in its lethal action, perhaps. But an epidemic, nonetheless. According to the World Health Organisation tobacco accounted for just over 3 million annual deaths in 1990, rising to 4.023 million annual deaths in 1998. The numbers of deaths due to tobacco will rise to 8.4 million in 2020 and reach roughly 10 million annually by 2030. This is quite simply ghastly. Tobacco kills. It kills in many different ways. It kills increasing numbers of women. It does its damage directly and indirectly. For children, much of the damage comes from smoking by adults where children live, study, play and work. The very least we should be able to offer every child is breathable air. Air that doesn´t do them damage. We´re now seeing a global public health response to the tobacco epidemic. The Tobacco Free Initiative launched by the World Health Organisation was matched by significant tobacco control initiatives throughout the world. During this conference we will hear about the experiences our speakers had in driving these initiatives. This Tobacco Free Initiative poses unique challenges to our legal frameworks at both national and international levels; in particular it raises challenges about the legal context in which tobacco products are traded and asks questions about the impact of commercial speech especially on children, and the extent of the limitations that should be imposed on it. Politicians, supported by economists and lawyers as well as the medical profession, must continue to explore and develop this context to find innovative ways to wrap public health considerations around the trade in tobacco products – very tightly. We also have the right to demand a totally new paradigm from the tobacco industry. Bluntly, the tobacco industry plays the PR game at its cynical worst. The industry sells its products without regard to the harm these products cause. At the same time, to gain social acceptance, it gives donations, endowments and patronage to high profile events and people. Not good enough. This model of behaviour is no longer acceptable in a modern society. We need one where the industry integrates social responsibility and accountability into its day-to-day activities. We have waited for this change in behaviour from the tobacco industry for many decades. Unfortunately the documents disclosed during litigation in the USA and from other sources make very depressing reading; it is clear from them that any trust society placed in the tobacco industry in the past to address the health problems associated with its products was misplaced. This industry appears to lack the necessary leadership to guide it towards just and responsible action. Instead, it chooses evasion, deception and at times illegal activity to protect its profits at any price and to avoid its responsibilities to society and its customers. It has engaged in elaborate ´spin´ to generate political tolerance, scientific uncertainty and public acceptance of its products. Legislators must act now. I see no reason why the global community should continue to wait. Effective legal controls must be laid on this errant industry. We should also keep these controls under review at regular intervals and if they are failing to achieve the desired outcomes we should be prepared to amend them. In Ireland, as Minister for Health and Children, I launched a comprehensive tobacco control policy entitled “Towards a Tobacco Free Society“. OTT?Excessive?Unrealistic? On the contrary – I believe it to be imperative and inevitable. I honestly hold that, given the range of fatal diseases caused by tobacco use we have little alternative but to pursue the clear objective of creating a tobacco free society. Aiming at a tobacco free society means ensuring public and political opinion are properly informed. It requires help to be given to smokers to break the addiction. It demands that people are protected against environmental tobacco smoke and children are protected from any inducement to experiment with this product. Over the past year we have implemented a number of measures which will support these objectives; we have established an independent Office of Tobacco Control, we have introduced free nicotine replacement therapy for low-income earners, we have extended our existing prohibitions on tobacco advertising to the print media with some minor derogations for international publications. We have raised the legal age at which a person can be sold tobacco products to eighteen years. We have invested substantially more funds in health promotion activities and we have mounted sustained information campaigns. We have engaged in sponsorship arrangements, which are new and innovative for public bodies. I have provided health boards with additional resources to let them mount a sustained inspection and enforcement service. Health boards will engage new Directors of Tobacco Control responsible for coordinating each health board´s response and for liasing with the Tobacco Control Agency I set up earlier this year. Most recently, I have published a comprehensive Bill – The Public Health (Tobacco) Bill, 2001. This Bill will, among other things, end all forms of product display and in-store advertising and will require all retailers to register with the new Tobacco Control Agency. Ten packs of cigarettes will be banned and transparent and independent testing procedures of tobacco products will be introduced. Enforcement officers will be given all the necessary powers to ensure there is full compliance with the law. On smoking in public places we will extend the existing areas covered and it is proposed that I, as Minister for Health and Children, will have the powers to introduce further prohibitions in public places such as pubs and the work place. I will also provide for the establishment of a Tobacco Free Council to advise and assist on an ongoing basis. I believe the measures already introduced and those additional ones proposed in the Bill have widespread community support. In fact, you´re going to hear a detailed presentation from the MRBI which will amply illustrate the extent of this support. The great thing is that the support comes from smokers and non-smokers alike. Bottom line, Ladies and Gentlemen, is that we are at a watershed. As a society (if you´ll allow me to play with a popular phrase) we´ve realised it´s time to ´wake up and smell the cigarettes.´ Smell them. See them for what they are. And get real about destroying their hold on our people. The MRBI survey makes it clear that the single strongest weapon we have when it comes to preventing the habit among young people is price. Simple as that. Price. Up to now, the fear of inflation has been a real impediment to increasing taxes on tobacco. It sounds a serious, logical argument. Until you take it out and look at it a little more closely. Weigh it, as it were, in two hands. I believe – and I believe this with a great passion – that we must take cigarettes out of the equation we use when awarding wage increases. I am calling on IBEC and ICTU, on employers and trade unions alike, to move away from any kind of tolerance of a trade that is killing our citizens. At one point in industrial history, cigarettes were a staple of the workingman´s life. So it was legitimate to include them in the ´basket´ of goods that goes to make up the Consumer Price Index. It isn´t legitimate to include them any more. Today, I´m saying that society collectively must take the step to remove cigarettes from the basket of normality, from the list of elements which constitute necessary consumer spending. I´m saying: “We can no longer delude ourselves. We must exclude cigarettes from the considerations we address in central wage bargaining. We must price cigarettes out of the reach of the children those cigarettes will kill.” Right now, in the monthly Central Statistics Office reports on consumer spending, the figures include cigarettes. But – right down at the bottom of the page – there´s another figure. Calculated without including cigarettes. I believe that if we continue to use the first figure as our constant measure, it will be an indictment of us as legislators, as advocates for working people, as public health professionals. If, on the other hand, we move to the use of the second figure, we will be sending out a message of startling clarity to the nation. We will be saying “We don´t count an addictive, killer drug as part of normal consumer spending.” Taking cigarettes out of the basket used to determine the Consumer Price Index will take away the inflation argument. It will not be easy, in its implications for the social partners. But it is morally inescapable. We must do it. Because it will help us stop the killer that is tobacco. If we can do it, we will give so much extra strength to health educators and the new Tobacco Control Association. This new organisation of young people who already have branches in over fifteen counties, is represented here today. The young adults who make up its membership are well placed to advise children of the dangers of tobacco addiction in a way that older generations cannot. It would strengthen their hand if cigarettes move – in price terms – out of the easy reach of our children Finally, I would like to commend so many public health advocates who have shown professional and indeed personal courage in their commitment to this critical public health issue down through the years. We need you to continue to challenge and confront this grave public health problem and to repudiate the questionable science of the tobacco industry. The Research Institute for a Tobacco Free Society represents a new and dynamic form of partnership between government and civil society. It will provide an effective platform to engage and mobilise the many different professional and academic skills necessary to guide and challenge us. I wish the conference every success.

Ideas, Possibilities and Limitations of Sustainable Economic Policy – the Example of Ecological Economics

A mesura que el suport del creixement econòmic constitueix un objectiu fonamental de la formulació de polítiques econòmiques, cal assenyalar que aquest tipus de creixement està limitat naturalment per un planeta finit. Aquest article argumenta que, des del punt de vista de la justícia intergeneracional, la realització d'un concepte de desmaterialització i, com a efecte, d'una economia que no creix (en el sentit de dissociació absoluta del creixement econòmic i consum d'energia i materials) es pot justificar. Per tant, el creixement pot ser també entesa com la millora de la qualitat de vida sobretot en comptes d'ampliar quantitats escarpats de sortida. Per tant, una dràstica reducció del cabal de material es necessita, sobretot en els països d'alts ingressos. Després de presentar alguns crítica de les propostes, en el focus d'aquest article es dibuixen en els arguments de per què la política econòmica en el futur han de ser etiquetats com "ecològic" i, a continuació, les opcions de posar en acció les idees del teòric presentat marc en tasques manejables polítiques seran discutides. En aquest cas, s'argumentarà que l'enfocament clàssic de internalització d'efectes externs sovint seguides de decisions de política econòmica ortodoxa no és completament capaç de reflectir canvis ecològics en les estructures de preus dels mercats. Per tant, formal (industrial i l'establiment de la política de consum) i institucions informals (llars) representen punts clau de la política econòmica sostenible, assenyalant l'individu com així com la responsabilitat col · lectiva per omplir aquest buit substancial.

Evidence-based Economic Policy - Three Essays in Applied Microeconometrics

Over thirty years ago, Leamer (1983) - among many others - expressed doubts about the quality and usefulness of empirical analyses for the economic profession by stating that "hardly anyone takes data analyses seriously. Or perhaps more accurately, hardly anyone takes anyone else's data analyses seriously" (p.37). Improvements in data quality, more robust estimation methods and the evolution of better research designs seem to make that assertion no longer justifiable (see Angrist and Pischke (2010) for a recent response to Leamer's essay). The economic profes- sion and policy makers alike often rely on empirical evidence as a means to investigate policy relevant questions. The approach of using scientifically rigorous and systematic evidence to identify policies and programs that are capable of improving policy-relevant outcomes is known under the increasingly popular notion of evidence-based policy. Evidence-based economic policy often relies on randomized or quasi-natural experiments in order to identify causal effects of policies. These can require relatively strong assumptions or raise concerns of external validity. In the context of this thesis, potential concerns are for example endogeneity of policy reforms with respect to the business cycle in the first chapter, the trade-off between precision and bias in the regression-discontinuity setting in chapter 2 or non-representativeness of the sample due to self-selection in chapter 3. While the identification strategies are very useful to gain insights into the causal effects of specific policy questions, transforming the evidence into concrete policy conclusions can be challenging. Policy develop- ment should therefore rely on the systematic evidence of a whole body of research on a specific policy question rather than on a single analysis. In this sense, this thesis cannot and should not be viewed as a comprehensive analysis of specific policy issues but rather as a first step towards a better understanding of certain aspects of a policy question. The thesis applies new and innovative identification strategies to policy-relevant and topical questions in the fields of labor economics and behavioral environmental economics. Each chapter relies on a different identification strategy. In the first chapter, we employ a difference- in-differences approach to exploit the quasi-experimental change in the entitlement of the max- imum unemployment benefit duration to identify the medium-run effects of reduced benefit durations on post-unemployment outcomes. Shortening benefit duration carries a double- dividend: It generates fiscal benefits without deteriorating the quality of job-matches. On the contrary, shortened benefit durations improve medium-run earnings and employment possibly through containing the negative effects of skill depreciation or stigmatization. While the first chapter provides only indirect evidence on the underlying behavioral channels, in the second chapter I develop a novel approach that allows to learn about the relative impor- tance of the two key margins of job search - reservation wage choice and search effort. In the framework of a standard non-stationary job search model, I show how the exit rate from un- employment can be decomposed in a way that is informative on reservation wage movements over the unemployment spell. The empirical analysis relies on a sharp discontinuity in unem- ployment benefit entitlement, which can be exploited in a regression-discontinuity approach to identify the effects of extended benefit durations on unemployment and survivor functions. I find evidence that calls for an important role of reservation wage choices for job search be- havior. This can have direct implications for the optimal design of unemployment insurance policies. The third chapter - while thematically detached from the other chapters - addresses one of the major policy challenges of the 21st century: climate change and resource consumption. Many governments have recently put energy efficiency on top of their agendas. While pricing instru- ments aimed at regulating the energy demand have often been found to be short-lived and difficult to enforce politically, the focus of energy conservation programs has shifted towards behavioral approaches - such as provision of information or social norm feedback. The third chapter describes a randomized controlled field experiment in which we discuss the effective- ness of different types of feedback on residential electricity consumption. We find that detailed and real-time feedback caused persistent electricity reductions on the order of 3 to 5 % of daily electricity consumption. Also social norm information can generate substantial electricity sav- ings when designed appropriately. The findings suggest that behavioral approaches constitute effective and relatively cheap way of improving residential energy-efficiency.

Multilateral Trade and Agricultural Policy Reforms in Sugar Markets, September 2005

We analyze the impact of trade liberalization, removal of production subsidies, and elimination of consumption distortions in world sugar markets using a partial-equilibrium international sugar model calibrated on 2002 market data and current policies. The removal of trade distortions alone induces a 27% price increase while the removal of all trade and production distortions induces a 48% increase by 2011/12 relative to the baseline. Aggregate trade expands moderately, but location of production and trade patterns change substantially. Protectionist OECD countries (the EU, Japan, the US) experience an import expansion or export reduction and significant contraction in production in unfettered markets. Competitive producers in both OECD countries (Australia) and non-OECD countries (Brazil, Cuba), and even some protected producers (Indonesia, Turkey), expand production when all distortions are removed. Consumption distortions have marginal impacts on world markets and location of production. We discuss the significance of these results in the context of mounting pressures to increase market access in highly protected OECD countries and the impact on non-OECD countries.

The impotence of price controls: failed attempts to constrain pharmaceutical expenditures in Greece.

BACKGROUND: While the prices of pharmaceuticals are relatively low in Greece, expenditure on them is growing more rapidly than almost anywhere else in the European Union. OBJECTIVE: To describe and explain the rise in drug expenditures through decomposition of the increase into the contribution of changes in prices, in volumes and a product-mix effect. METHODS: The decomposition of the growth in pharmaceutical expenditures in Greece over the period 1991-2006 was conducted using data from the largest social insurance fund (IKA) that covers more than 50% of the population. RESULTS: Real drug spending increased by 285%, despite a 58% decrease in the relative price of pharmaceuticals. The increase in expenditure is mainly attributable to a switch to more innovative, but more expensive, pharmaceuticals, indicated by a product-mix residual of 493% in the decomposition. A rising volume of drugs also plays a role, and this is due to an increase in the number of prescriptions issued per doctor visit, rather than an increase in the number of visits or the population size. CONCLUSIONS: Rising pharmaceutical expenditures are strongly determined by physicians' prescribing behaviour, which is not subject to any monitoring and for which there are no incentives to be cost conscious.

On optimal monetary and fiscal policy interactions in open economies

This paper studies monetary and fiscal policy interactions in a two country model, where taxes on firms sales are optimally chosen and the monetary policy is set cooperatively.It turns out that in a two country setting non-cooperative fiscal policy makers have an incentive to change taxes on sales depending on shocks realizations in order to reduce output production. Therefore whether the fiscal policy is set cooperatively or not matters for optimal monetary policy decisions. Indeed, as already shown in the literature, the cooperative monetary policy maker implements the flexible price allocation only when special conditions on the value of the distortions underlying the economy are met. However, if non-cooperative fiscal policy makers set the taxes on firms sales depending on shocks realizations, these conditions cannot be satisfied; conversely, when fiscal policy is cooperative, these conditions are fulfilled. We conclude that whether implementing the flexible price allocation is optimal or not depends on the fiscal policy regime.

Regulatory ambivalence and the limitations of pharmaceutical policy in Spain

Broadly speaking, pharmaceutical policy in Spain has been unable to control either the price or thevolume of drugs prescribed. Limited attempts have been made to bring together the regulation of thepharmaceutical market and policies, in pursuit of the desired goals of efficiency and quality. Thispaper assesses the regulation of the Spanish pharmaceutical market over the last two decades byexamining regulation and policy and the available empirical evidence on their appreciable effects,and presents recommendations for policy design. Our findings suggest that policies aiming to improveefficiency and quality have not managed to contain costs, while cost-effectiveness is still overlooked.We argue that future policies should encourage broader participation in the decision-making processesand promote a higher degree of competition, especially from generic drugs.

Monetary policy and exchange rate volatility in a small open economy

We lay out a small open economy version of the Calvo sticky price model, and show how the equilibrium dynamics can be reduced to simple representation in domestic inflation and the output gap. We use the resulting framework to analyze the macroeconomic implications of three alternative rule-based policy regimes for the small open economy: domestic inflation and CPI-based Taylor rules, and an exchange rate peg. We show that a key difference amongthese regimes lies in the relative amount of exchange rate volatility that they entail. We also discuss a special case for which domestic inflation targeting constitutes the optimal policy, and where a simple second order approximation to the utility of the representative consumer can be derived and used to evaluate the welfare losses associated with the suboptimal rules.

Price differentials in monetary unions: The role of fiscal shocks

We study the effect of regional expenditure and revenue shocks on price differentials for47 US states and 9 EU countries. We identify shocks using sign restrictions on the dynamicsof deficits and output and construct two estimates for structural price differentials dynamics which optimally weight the information contained in the data for all units. Fiscal shocks explain between 14 and 23 percent of the variability of price differentials both in the US and in the EU. On average, expansionary fiscal disturbances produce positive price differential responses while distortionary balance budget shocks produce negative price differential responses. In a number of units, price differential responses to expansionary fiscal shocks are negative. Spillovers and labor supply effects partially explain this pattern while geographical, political, and economic indicators do not.

Macroeconomic modeling for monetary policy evaluation

We describe some of the main features of the recent vintage macroeconomic models used for monetary policy evaluation. We point to some of the key differences with respect to the earlier generation ofmacro models, and highlight the insights for policy that these new frameworks have to offer. Our discussion emphasizes two key aspects of the new models: the significant role of expectations of future policy actions in the monetary transmission mechanism, and the importance for the central bank of tracking of the flexible price equilibrium values of the natural levels of output and the real interest rate. We argue that both features have important implications for the conduct of monetary policy.

On the quantitative importance of wage bargaining models

Four general equilibrium search models are compared quantitatively. Thebaseline framework is a calibrated macroeconomic model of the US economydesigned for a welfare analysis of unemployment insurance policy. Theother models make three simple and natural specification changes,regarding tax incidence, monopsony power in wage determination, and therelevant threat point. These specification changes have a major impacton the equilibrium and on the welfare implications of unemploymentinsurance, partly because search externalities magnify the effects ofwage changes. The optimal level of unemployment insurance dependsstrongly on whether raising benefits has a larger impact on searcheffort or on hiring expenditure.

The new Keynesian approach to monetary policy analysis: Lessons and new directions

I discuss several lessons regarding the design and conduct of monetary policy that have emerged out of the New Keynesian research program. Those lessons include the bene.ts of price stability, the gains from commitment about future policies, the importance of nat-ural variables as benchmarks for policy, and the bene.ts of a credible anti-inflationary stance. I also point to one challenge facing NK modelling efforts: the need to come up with relevant sources of policy tradeoffs. A potentially useful approach to meeting that challenge, based on the introduction of real imperfections, is presented.

Monetary policy and unemployment

Much recent research has focused on the development and analysisof extensions of the New Keynesian framework that model labor marketfrictions and unemployment explicitly. The present paper describessome of the essential ingredients and properties of those models, andtheir implications for monetary policy.

Which inflation to target? A small open economy with sticky wages indexed to past inflation

In a closed economy context there is common agreement on price inflation stabilization being one of the objects of monetary policy. Moving to an open economy context gives rise to the coexistence of two measures of inflation: domestic inflation (DI) and consumer price inflation (CPI). Which one of the two measures should be the target variable? This is the question addressed in this paper. In particular, I use a small open economy model to show that once sticky wages indexed to past CPI inflation are introduced, a complete inward looking monetary policy is no more optimal. I first, derive a loss function from a secondorder approximation of the utility function and then, I compute the fully optimalmonetary policy under commitment. Then, I use the optimal monetary policy as a benchmark to compare the performance of different monetary policy rules. The main result is that once a positive degree of indexation is introduced in the model the rule performing better (among the Taylor type rules considered) is the one targeting wage inflation and CPI inflation. Moreover this rule delivers results very close to the one obtained under the fully optimal monetary policy with commitment.