Welfare and growth effects of alternative fiscal rules for infrastructure investment in Brazil

This article studies the interplay between fiscal rules, public investment and growth in Brazil. It is investigated if it would make sense to raise public investment and, if so, under which fiscal rule it is best to do it — whether through tax financing, debt financing, or a reduction of public consumption. We construct and simulate a competitive general equilibrium model, calibrated to Brazilian economy, in which public capital is a component of the production function and public consumption directly affects individuals’ well-being. After assessing the impacts of alternative fiscal rules, the paper concludes that the most desirable financing scheme is the reduction of public consumption, which dominates the others in terms of output and welfare gains. The model replicates the observed growth slowdown of the Brazilian economy when we increase taxes and reduce public capital formation to the levels observed after 1980 and shows that the growth impact of the expansion of tax collection in Brazil was much larger than that of public investment compression.

A note on growth, welfare and public policy

In this note the growth anti welfare effects of fiscal anti monetary policies are investigated in three economies where public investment is part of the productive process It is shown that growth is maximized at positive levels of income tax and inflation but that there is no direct relationship between government size, productivity and growth or between inflation and growth. However, unless there are no transfers or public goods in the economy, maximization of growth does not imply welfare maximization and the optimal tax rate and government size are greater than those that maximize growth. Money is not superneutral anti the optimal rate of money creation is below the maximizing rate of growth.

Poverty - dynamic and sustainability perspectives: Implications for welfare and policy with reference to India

After outlining some comparative features of poverty in India, this article reviews critically recent literature on the dynamics of poverty. On economic efficiency grounds, it rejects the view that the chronically poor are more deserving than the non-chronic poor of poverty assistance. Mechanisms of households and communities for coping with poverty are discussed. The possibility is raised that where poverty has been persistent that rational methods for coping with it are likely to be well established, and less suffering may occur than for households and communities thrown temporarily into poverty. However, situations can also be envisaged where such rational behaviours deepen the poverty trap and create unfavourable externalities for poverty alleviation. Conflict can arise between programmes to alleviate poverty in poor communities and the sustainability of these communities and their local cultures. Problems posed by this are discussed. Furthermore, the impact of market extension on poor landholders is considered. In contrast to the prevailing view that increased market extension and liberalisation is favourable to poor farmers, it is argued that inescapable market transaction cost makes it difficult for the poor to survive as landholders in a fluid and changing market system. The likelihood of poor landholders joining the landless poor rises, and if they migrate from the countryside to the city they face further adjustment hurdles. Consequently, poor landholders may be poorer after the extension of the market system and only their offspring may reap benefits from market reforms.

Crises and growth: A re-evaluation

We address the question of whether growth and welfare can be higher in crisis prone economies. First, we show that there is a robust empirical link between per-capita GDP growth and negative skewness of credit growth across countries with active financial markets. That is, countries that have experienced occasional crises have grown on average faster than countries with smooth credit conditions. We then present a two-sector endogenous growth model in which financial crises can occur, and analyze the relationship between financial fragility and growth. The underlying credit market imperfections generateborrowing constraints, bottlenecks and low growth. We show that under certain conditions endogenous real exchange rate risk arises and firms find it optimal to take on credit risk in the form of currency mismatch. Along such a risky path average growth is higher, but self-fulfilling crises occur occasionally. Furthermore, we establish conditions under which the adoption of credit risk is welfare improving and brings the allocation nearer to the Pareto optimal level. The design of the model is motivated by several features of recent crises: credit risk in the form of foreign currency denominated debt; costly crises that generate firesales and widespread bankruptcies; and asymmetric sectorial responses, wherethe nontradables sector falls more than the tradables sector in the wake of crises.

Wealth, financial intermediation and growth

This paper presents empirical support for the existence of wealth effects in the contribution of financial intermediation to economic growth, and offers a theoretical explanation for these effects. Using GMM dynamic panel data techniques applied to study the growth-promoting effects of financial intermediation, we show that the exogenous contribution of financial development on economic growth has different effects for different levels of income per capita. We find that this contribution is generally increasing with thelevel of income per capita of the economy, up to a relatively high level of income. This contribution is consistently lower for poor countries; and for some low levels of income per capita it can be negative. We provide a model to account for these wealth effects. The model is a overlapping generations growth model where financial intermediaries implement liquidity risk sharing among depositors. We show that at early stages of economic development, a bank can increase welfare of its depositors only at the cost of lowering investment and growth. However, once the economy has crossed certain wealth threshold, the liquidity role of banks becomes unambiguously growth enhancing. As wealth increases, banks offer improving liquidity insurance, and higher growth; however, for high levels of wealth, growth generated byfinancial intermediation declines as the economy attains the optimal level of consumption risk sharing.

Child Welfare Provider Growth Options Committee Final Report, February 6, 2009

This report summarizes the work undertaken and results produced, by the Iowa Department of Human Services (DHS) in consultation with the Child Welfare Provider Growth Options Committee. The committee’s purpose, membership, work process and options considered are outlined below.

Welfare and fiscal policy with public goods and infrastructure

We construct and simulate a model to study the welfare and macroeconomic impact of government actions when its productive role is taken into account. The trade-off between public investment and public consumption is also investigated, since public consumption is introduced as a public good that directly affects individuals' well-being. Our results replicate econometric evidence showing that part of the observed slowdown of U.S. productivity growth can be explained by the reduction of investment in infrastructure which also implied a sizable welfare 1085 to the popu1ation. Depending on the methodology used we found a welfare cost ranging from 4.2% to 1.16% of GNP. The impact of fiscal policy can be qualitative and quantitative distinct depending on Whether we assume a higher or smaller output elasticity to infrastructure. If it is high enough, increases in tax rates may stimulate accumulation and production, which is the opposite prediction of standard ncocJassica1 models.

Inflation, welfare and public expenditures

This paper studies welfare effects of monetary policy in an overlapping generations model with capital and no form of taxation other than inflation. Public expenditures have a positive effect on labor productivity. The main result of the paper is that an expansive monetary policy can be welfare improving, at least for ìsmall enoughî inflation rates, and that there is an optimal inflation rate. Growth maximization, however, is never optimal. Steady-state capital and output increase with inflation, reproducing the so-called Tobin effect. For large inflation rates, however, the government authorities cannot affect real variables and there are only nominal effects.

Effect of rearing techniques and feed composition on productive traits, bird welfare and quality of poultry products

The PhD project was focused on the study of the poultry welfare conditions and improvements. The project work was divided into 3 main research activities. A) Field evaluation of chicken meat rearing conditions kept in intensive farms. Considering the lack of published reports concerning the overall Italian rearing conditions of broiler chickens, a survey was carried out to assess the welfare conditions of broiler reared in the most important poultry companies in Italy to verify if they are in accordance with the advices given in the European proposal COM (2005) 221 final. Chicken farm conditions, carcass lesions and meat quality were investigated. 1. The densities currently used in Italy are in accordance with the European proposal COM 221 final (2005) which suggests to keep broilers at a density lower than 30-32 kg live weight/m2 and to not exceed 38-40 kg live weight/m2. 2. The mortality rates in summer and winter agree with the mortality score calculated following the formula reported in the EU Proposal COM 221 final (2005). 3. The incidence of damaged carcasses was very low and did not seem related to the stocking density. 4. The FPD scores were generally above the maximum limit advised by the EU proposal COM 221 final (2005), although the stocking densities were lower than 30-32 kg live weight per m2. 5. It can be stated that the control of the environmental conditions, particularly litter quality, appears a key issue to control the onset of foot dermatitis. B) Manipulation of several farm parameters, such litter material and depth, stocking density and light regimen to improve the chicken welfare conditions, in winter season. 1. Even though 2 different stocking densities were established in this study, the performances achieved from the chickens were almost identical among groups. 2. The FCR was significantly better in Standard conditions contrarily to birds reared in Welfare conditions with lower stocking density, more litter material and with a light program of 16 hours light and 8 hours dark. 3. In our trial, in Standard groups we observed a higher content of moisture, nitrogen and ammonia released from the litter. Therefore it can be assumed that the environmental characteristics have been positively changed by the improvements of the rearing conditions adopted for Welfare groups. 4. In Welfare groups the exhausted litters of the pens were dryer and broilers showed a lower occurrence of FPD. 5. The prevalence of hock burn lesions, like FPD, is high with poor litter quality conditions. 6. The combined effect of a lower stocking density, a greater amount of litter material and a photoperiod similar to the natural one, have positively influenced the chickens welfare status, as a matter of fact the occurrence of FPD in Welfare groups was the lowest keeping the score under the European threshold of the proposal COM 221 final(2005). C) The purpose of the third research was to study the effect of high or low stocking density of broiler chickens, different types of litter and the adoption of short or long lighting regimen on broiler welfare through the evaluation of their productivity and incidence of foot pad dermatitis during the hot season. 1. The feed efficiency was better for the Low Density than for High Density broilers. 2. The appearance of FPD was not influenced by stocking density. 3. The foot examination revealed that the lesions occurred more in birds maintained on chopped wheat straw than on wood shaving. 4. In conclusion, the adoptions of a short light regimen similar to that occurring in nature during summer reduces the feed intake without modify the growth rate thus improving the feed efficiency. Foot pad lesion were not affected neither by stocking densities nor by light regimens whereas wood shavings exerted a favourable effect in preserving foot pad in good condition. D) A study was carried out to investigate more widely the possible role of 25-hydroxycholecalciferol supplemented in the diet of a laying hen commercial strain (Lohmann brown) in comparison of diets supplemented with D3 or with D3 + 25- hydroxycholecalciferol. Egg traits during a productive cycle as well as the bone characteristics of the layers have been as well evaluated to determine if there the vitamin D3 may enhance the welfare status of the birds. 1. The weight of the egg and of its components is often greater in hens fed a diet enriched with 25-hydroxycholecalciferol. 2. Since eggs of treated groups are heavier and a larger amount of shell is needed, a direct effect on shell strength is observed. 3. At 30 and at 50 wk of age hens fed 25 hydroxycholecalciferol exhibited greater values of bone breaking force. 4. Radiographic density values obtained in the trial are always higher in hens fed with 25-hydroxycholecalciferol of both treatments: supplemented for the whole laying cycle (25D3) or from 40 weeks of age onward (D3+25D3).

Essays on openness, economic integration, and *growth

This dissertation examines the relationship between the degree of openness to international trade and the level of growth experienced by a country. More precisely, it explores how trade liberalization and economic integration can lead to specialization in production, affect national levels of welfare, productivity, and competition and at the same time reinforce deflationary efforts. A large part of this investigation is carried out using industry-level data from Spain. ^

Impaired Compensatory Beta-cell Function And Growth In Response To High-fat Diet In Ldl Receptor Knockout Mice.

In this study, we investigated the effect of low density lipoprotein receptor (LDLr) deficiency on gap junctional connexin 36 (Cx36) islet content and on the functional and growth response of pancreatic beta-cells in C57BL/6 mice fed a high-fat (HF) diet. After 60 days on regular or HF diet, the metabolic state and morphometric islet parameters of wild-type (WT) and LDLr-/- mice were assessed. HF diet-fed WT animals became obese and hypercholesterolaemic as well as hyperglycaemic, hyperinsulinaemic, glucose intolerant and insulin resistant, characterizing them as prediabetic. Also they showed a significant decrease in beta-cell secretory response to glucose. Overall, LDLr-/- mice displayed greater susceptibility to HF diet as judged by their marked cholesterolaemia, intolerance to glucose and pronounced decrease in glucose-stimulated insulin secretion. HF diet induced similarly in WT and LDLr-/- mice, a significant decrease in Cx36 beta-cell content as revealed by immunoblotting. Prediabetic WT mice displayed marked increase in beta-cell mass mainly due to beta-cell hypertrophy/replication. Nevertheless, HF diet-fed LDLr-/- mice showed no significant changes in beta-cell mass, but lower islet-duct association (neogenesis) and higher beta-cell apoptosis index were seen as compared to controls. The higher metabolic susceptibility to HF diet of LDLr-/- mice may be explained by a deficiency in insulin secretory response to glucose associated with lack of compensatory beta-cell expansion.

Morphological and growth alterations on early development stages of Iridaea cordata (Rhodophyta) under different intensities of UVB radiation

This study describes the effects of different intensities of UVB radiation on growth and morphology of early development stages of Iridaea cordata in germlings, young gametophytes originated in the laboratory and young fronds collected in the Magellan Strait, Chile. The experiments were carried out during four weeks in controlled conditions of temperature and photoperiod and the results were compared with a control treatment (without UVB). All UVB irradiation treatments caused bleaching and decrease in growth rates of germlings. Additionally, initial upright fronds were not observed in any of the UVB treatments, where as those cultivated in UVB absence developed erect ones in the second week of culture. The young gametophytes exhibited morphological alteration (small number and size of basal ramifications, curling of tips, bleaching and necrosis) and decrease in growth when exposed to UVB radiation. Young fronds collected from the field showed mainly morphological alterations (curling of frond). Morphological alterations in young gametophytes and young fronds of I. cordata could be interpreted as a defense against UVB by reducing the area exposed to radiation. However, high level of UVB radiation can produce irreparable damage, such as necrosis, observed in young gametophytes originated in the laboratory. Finally, the UVB effects on early developmental stages of I. cordata depend on the UVB irradiance and time of exposition.