Debt relief and the scaling up of aid to low-income countries should allow for greater fiscal space for expenditure programs to create long-term growth and lower poverty rates. But designing a ...suitable medium-term fiscal framework that fosters a sustainable delivery of better public services and infrastructure while maintaining a credible commitment to fiscal prudence confronts many challenges. This paper discusses what low-income countries can do to shape fiscal policy frameworks that are ambitious in trying to absorb additional aid while still ensuring longer-term sustainability for government expenditure programs and finances. It suggests what approaches can be used to manage the greater fiscal policy risks associated with a scaled-up aid environment, including coordination with monetary policy. The paper also discusses what institutional changes are needed if donors and countries are to facilitate the implementation of a higher level of aid-financed spending programs.
Good practice suggests that budget allocations should reflect spending priorities and that spending should provide cost-effective delivery of public goods and services. This paper analyzes the ...composition of public expenditure in the Slovak Republic. It also assesses the relative efficiency of spending in education and health. The Slovak Republic spends more on social benefits and less on wages compared to the EU and OECD average. While it manages to translate the low expenditures into outcomes in an efficient manner in the education sector, this is not true for health. Moreover, the recent increases in expenditure levels have not improved outcomes, suggesting that significant budgetary savings could be achieved through increases in efficiency.
A key challenge in government budgeting is to define an appropriate balance between current and capital expenditures. Budgeting for government capital investment also remains not well-integrated into ...the formal budget preparation process in many countries. This paper aims to provide an overview of past and current budgeting practices for public investment. The study will also provide a comparison between the budget practices between low-income countries and developed countries and make a series of recommendations for how to ensure efficient integration of capital planning and budget management in low-income countries.
A well-functioning public expenditure management (PEM) system is considered a critical pillar of government efficiency, on par with a low-distortion tax system and efficient tax administration. The ...paper discusses PEM systems in developing countries using an analytical framework based on principal-agent theory. This simple model can be applied to various PEM systems, and allows for comparisons between institutional settings. To illustrate this, we analyze the benefits derived from the use by the Ministry of Finance (MoF) of two control instruments; ex post audits and ex ante controls, and assess their value in terms of their ability to deter cheating. We derive a set of possible "control regimes" which can be used by the MoF. Although we illustrate the use of the model using developing countries, it is also relevant to developed economies.
To investigate trends in out-of-pocket health-care payments and catastrophic health expenditure in India by household age composition.
We obtained data from four national consumer expenditure surveys ...and three health-care utilization surveys conducted between 1993 and 2014. Households were divided into five groups by age composition. We defined catastrophic health expenditure as out-of-pocket payments equalling or exceeding 10% of household expenditure. Factors associated with catastrophic expenditure were identified by multivariable analysis.
Overall, the proportion of catastrophic health expenditure increased 1.47-fold between the 1993-1994 expenditure survey (12.4%) and the 2011-2012 expenditure survey (18.2%) and 2.24-fold between the 1995-1996 utilization survey (11.1%) and the 2014 utilization survey (24.9%). The proportion increased more in the poorest than the richest quintile: 3.00-fold versus 1.74-fold, respectively, across the utilization surveys. Catastrophic expenditure was commonest among households comprising only people aged 60 years or older: the adjusted odds ratio (aOR) was 3.26 (95% confidence interval, CI: 2.76-3.84) compared with households with no older people or children younger than 5 years. The risk was also increased among households with both older people and children (aOR: 2.58; 95% CI: 2.31-2.89), with a female head (aOR: 1.32; 95% CI: 1.19-1.47) and with a rural location (aOR: 1.27; 95% CI: 1.20-1.35).
The proportion of households experiencing catastrophic health expenditure in India increased over the past two decades. Such expenditure was highest among households with older people. Financial protection mechanisms are needed for population groups at risk for catastrophic health expenditure.
This paper examines the effects of total, mineral, natural gas, and oil rents on the public total, education, health, and infrastructure expenditures using the dynamic panel estimation methods and ...data for more than 100 countries for the 1980–2015 period. Our results indicate that total resource rents do not have a significant impact on the public total and infrastructure expenditures. However, they provide a robust evidence for the adverse effect of resource rents on the public education and health expenditures. Our results lend a substantial evidence for the conclusion that the notorious resource curse can be also explained by its adverse effect on the human capital accumulation. We then test whether the democracy level matters in investigating the effects of resource rents on the public expenditures. Interestingly, we find that total resource rents exert a negative impact on the education expenditures only in autocratic countries. These results clearly indicate that policy makers should take necessary steps to remove the adverse effects of resource rents on the public education and health expenditures to increase human capital formation.
Economic policies are often judged by a handful of statistics, some of which may be biased during periods of change. We estimate the income growth implied by the evolution of food demand and durable ...good ownership in post-reform Brazil and Mexico, and find that changes in consumption patterns are inconsistent with official estimates of near stagnant incomes. That is attributed to biases in the price deflator. The estimated unmeasured income gains are higher for poorer households, implying marked reductions in "real" inequality. These findings challenge the conventional wisdom that post-reform income growth was low and did not benefit the poor.
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