This study investigates the welfare implications of BTL projects using a general equilibrium model with the public sector and public-private partnerships. We show that when the government is not allowed to run budget deficits but private firms is able to overcome the financial constraint, BTL projects performed by public-private partnerships (PPPs) could be a good alternative and improve the welfare of the model economy. This paper quantitatively investigates excessive expansion of PPP projects and several alternatives to retrieve welfare losses caused by such an expansion. Assuming that future rents of BTL projects are not taken into account, we find the welfare losses up to 20 percent relative to conventional government projects. Finally, we show that it would be possible to reduce the losses by transforming the fully depreciated capital stock of the government projects into much smaller new PPP projects.
Purpose: The main aim of this study is to evaluate the adoption of Public Private Partnership (PPP) approach in E-Government programs in Jordan which is considered a developing country, by evaluating the second stage of the three-stage model of PPP developed by (Al-Shqairat, 2009). Design/methodology/approach: A mixed quantitative and qualitative research approach was adopted. Qualitative data was collected using semi structured interviews with eleven IT managers working in public organizations. Quantitative data, on the other hand, was collected using a questionnaire designed and validated for the current study. A total of 109 questionnaires were distributed to participant working in 13 different public entities. These participants were also directly involved in Public Private Partnership projects in these entities. The response rate of 56.88% percent was adequate for accuracy and the results were useful and representative of the target population. The questionnaire data was analyzed using parametric statistics including mean analysis.Findings: The main findings of this study shows significant support for the proposed implementation stage. Furthermore, the survey and the interview analysis highlighted that the benefits and obstacles are more important than any other aspect of the implementation stage. Originality/ value: This study is one of the few studies that attempted to propose and validate an empirical model of PPPImplementation in E-Government projects that could be adopted by governments while planning for a successful PPP approach in implementing E-Government initiatives in specific or an ICT related projects. Keywords: Public Private Partnership (PPP) implementation; E-Government; Jordan; Public Sector, Private Sector, PPP forms, PPP mechanisms.
Given that the formal analysis does not admit a conclusion on how an increase in a¤ects welfare, I proceed to a calibration of the theoretical model. In addition, the calibration allows me to measure the welfare cost of in‡ation in the presence of limited participation in the credit market as well as the cost of ine¢ cient risk sharing arising from limited participation. The basic feature of the model presented is the existence of two types of transactions: those which involve a credit operation and those which are immediately settled and hence require an investment in the form of money balances. Among the payment instruments actually used, I identify the former with the use of credit cards and the latter with the use of monetary instruments such as cash, debit cards, and checks. Revolving credit does not arise in this model owing to the quasi-linear preferences in the settlement stage, so that credit is extended within the period. I interpret this credit operation as the grace period granted by credit card issuers, during which no interest is charged on the outstanding balance. This credit operation is usually referred to as convenience credit. My analysis concerns the e¤ect of the availability of convenience credit for a subset of transactions, those carried out with credit cards, whereas the rest of transactions are immediately settled. 14
This section discusses how the two implementation strategies, i.e., the big-bang strategy and the gradualism strategy, can result in macroeconomic fluctuations as well as their welfare implications in the short run. Endogenous variables are approximated as the linear functions of state variables in logarithms around the old steady state 9 , which we solve using the MATLAB codes provided by Schmitt-Groh´ e and Uribe (2004). In order to explicitly show aggregate fluctuations resulting from endogenous asset reallocation only, we set χ = 0 so as to exclude the effect of changes in household labor supply. Thus, households supply inelastically their labor endowment to the final goods production l = ¯ L = 1. We also set τ = 0. Figure 6 shows the impulse responses of the model economy with respect to the big-bang strategy (dash-dotted lines) and the gradualism strategy (solid lines) with which the public regulator raises θ permanently from 50% to 55%.
Given the popularity of the standard un- employment rate as a measure of economic health, can anything be said about whether, as an empirical matter, welfare reform is likely to raise or lower the unemployment rate? Accord- ing to the best available data, approximately two-thirds of those leaving the welfare rolls in response to American welfare reform found jobs and were still working a year later (General Accounting Office 1999), which is almost equal to the labor force participation rate of the popu- lation as a whole. Moreover, the demographic characteristics of former welfare recipients — primarily single female heads of household — would generally be associated with lower labor force participation rates. While it is too early to draw any firm conclusions, it seems reasonable to infer that welfare reform has exerted a modest
Child women welfare programme of Telangana Government provides one nutritious meal every day to pregnant and lactating women and children below the age of six through Anganwadicentres. The scheme was launched officially on January1, 2015 by Honourable Chief Minister K. ChandrashekarRao. For the women 200 ml of milk for 25 days a month and one egg each day will be given with meal. Children, aged between seven months and three years are provded with 16 eggs a month in addition to a 2.5 kg food packet. For children aged between 3 and six years, one egg a day in addition to rice, dal, vegetables and snacks is supplied. A total 18,96,844 lactating mothers, 5,18,215 infants and 2158479 pregnant women were covered under the scheme expending Rs. 627.96 crore in the past year. The quantity of food items supplied under the scheme has also been increased across all the categories.
The Association of Southeast Asian Nations (ASEAN) is a regionally-based international organization with ten members. ASEAN was created in 1967 with five members: Thailand, Singapore, Malaysia, Indonesia and the Philippines. In addition to the five original members, Brunei joined in 1984, Vietnam in 1995, Lao PDR and Myanmar (Burma) in 1997 and Cambodia in 1999. In 2008 or the 40 th anniversary, the ten ASEAN members signed a charter. The charter is a stronger agreement between member countries to cooperate. With the implementation of this charter, the cooperation between ASEAN countries, which was originally very loose, will become closer. The charter will be the basis of the implementation of ASEAN free trade in 2015.
The database that will be used below is the new “Structural Analysis Database” (STAN) provided by the OECD. This database not only includes but also extends the OECD’s former “International Sectoral Database” (ISDB), which has been used inter alia by Wei/Parsley (1995), Engel (1999) and Sarno et al (2004). STAN, in principle, comprises data on all the sectors (goods and services) of all OECD countries. The sectoral division is based on the International Standard Industrial Classification (ISIC) Rev. 3. STAN does not, of course, provide data at an individual goods level. Obviously, it would have been convenient to work with price data that do not apply to baskets of goods. However, that is no reason to refrain from performing the analysis at a sectoral level, 2 especially if it can be shown that, even at this level, there are severe problems in meeting the criteria for PPP to hold. Furthermore, more disaggregated data were simply unavailable for a panel of countries.
Geographical factors (captured by λ r ) are also important to determine household consumption (and consumption inequality) and related to financial inclusion. These factors include rural/urban, province and the Hukou. The Chinese economy is characterized by a remarkable rural-urban division (Knight and Song, 1999). The rural areas lag far behind the urban areas in terms of basic infrastructure such as roads, wastewater services, water supply and sanitation. This uneven development in turn leads to uneven access to financial instruments across rural and urban areas, and therefore, the effect of financial inclusion on outcome variables might differ depending on the level of urbanization. The same argument applies to provinces as well. Another reason for rural-urban division in China is the unique Hukou system of household registration. Before the economic reform in 1978, the household register was used mainly to control population mobility caused by food shortages. Households who could produce their own food were classified as agricultural Hukou, and those who receive food from the government were classified as non-agricultural Hukou. Traditionally, most agricultural Hukou households live in rural areas and most non-agricultural Hukou households live in urban areas. The strict restrictions on permanent migration from rural to urban Hukou and vice versa is still in place in many parts of China. The Hukou system generates remarkable socioeconomic gap between rural and urban residents because of government’s discriminatory policies. 15
PPP is also becoming popular in Australia. New South Wales (NSW), like other states of Australia, has faced increasing demands for infrastructure of all types. Meeting these demands has been difficult due to budgetary restraints. Raneberg (1994) has described the four key reform objectives of the NST Government as the optimal allocation of scarce public sector resources, efficiency, better service, and accountability for performance. A range of market-orientated initiatives have been employed to secure these objectives. These include measures ranging from wholesale privatization to contracting out in-house service needs, as well as private sector participation in infrastructure projects.
performance of rich economies). This fact is not new: it has been amply documented and is simply reflected here in the increase in inter-country inequality. 14 The new GDP numbers do not change our interpretation of the recent past, in that regard. Divergence lasted for some 20 years. However, since 2001, we notice a change. For the first time since 1982 divergence between countries’ GDPs per capita has stopped and even become reversed. In effect, the period 2001-06 has been good not only for the global economy (which is driven by the largest and richest countries), but also for the African countries that have grown at the rate of more than 4 percent per annum, post-Communist countries (growth at more than 6 percent per annum), and Latin America (3 percent p.a.). These factors were behind the reversal of divergence which we observe after 2001. It is, of course, not obvious that the global financial crisis and its aftermath will allow these hopeful developments to continue. At the end, note that even with the favorable developments around the turn of the century, the level of Concept 1 inequality is now significantly greater than it was in the 1960s and 1970s.
the project, drawing up of briefing documents & site reports, thus identifying areas of consideration from the point of social and environmental sustainability along with an outline scheme. Hence it would be paramount to set the requirements at the very start of the project to give clear direction and flow to the next stages of PPP process. In addition, the public partner is responsible for developing a general policy framework including the legal framework that will enable the PPP to operate efficiently and effectively. The main mechanism of achieving this deliverable is by providing guidance to both the state agency (public partner) and the private partners involved in the project. Some of the other key functions of the public partners may include procuring, giving financial advice and project managing the PPP project. Additionally, the Accountable Officer in charge of this PPP project on the public sector must have a clear understanding of risk allocation and project finance issues, that are likely to emerge as the project develops. When introducing private finance to the provision of a public facility the process brings with it a range of new financial issues of which the Accountable Officer must be aware. In Ireland, NDFA provides assistance on this issue to the Accountable officer (DoES). The finance for a PPP project will be raised by the private sector using a combination of equity, internally generated cash flow and debt. Thus, adequate provision for sustainability measures should be included while preparing the PSB. This will give clear direction to the project moving forward in relation to sustainability.
The case for using the CPI in the PPP specification is weak. The CPI contains non-traded goods and services prices, e.g., haircut price, and prices of inputs that are non-traded goods, which have nothing to do with the exchange rate. So instead of the CPI we argue for using commodity prices, which are more consistent with the theory to test the puzzle. Specifically, a country’s trade is usually dominated by a single or a few commodities. In the case of Canada for example, crude oil is the major export. It is about 25 percent of total exports and 10 percent of GDP. Thus, the ratio of the Canadian price of oil relative to the international price of oil would be fluctuating around 1, which is consistent with PPP. The Canadian dollar is mostly affected by the price of oil. The same is true for Australia, where coal and iron ore dominate trade, dairy is in the case of New Zealand, and copper is in Chile…etc. Even commodity price indices are more suitable to test the PPP than general price indices because, presumably, the weight on the dominant traded commodity is high.
Price changes must be taken into account before accurate comparisons are made between periods. As the total GDP is the calculation of prices and quantities, a large increase in prices can actually outweigh a decrease in quantities produced but result in an actual increase in the measured total GDP. Unlike the inherent problems with the changes in tastes and preferences in price indexes, this problem can be overcome with the use of a price deflator. This mechanism removes the changes in total GDP caused by fluctuating prices and results in a truer picture of any increases in economic activity. The price deflator is generally related to the consumer price index. It should be noted though that within larger countries, price changes can differ spatially (Kakwani 1997c). The Consumer Price Index (CPI) is the usual price deflator used in total GDP calculations. However, ‘one source of error arises from the fact that the CPI is a Laspeyres index that uses fixed weights in averaging the inflation rates of the individual goods, so substitution is not taken into account as relative price changes’ (Slesnick 1998, p. 2150). Therefore, CPI is overstated reducing total GDP more than it should and thus impacting on social welfare measures.
both in economic theory as well as in applied policy analysis. While measures of this welfare change like compensating variation or equivalent variation are theoretically well understood, the empirical side of welfareanalysis in a heterogeneous population is less well developed. The challenge comes from the fact that in the common cross section data sets we observe every single individual only once, and, in particular, we do not observe the same individual under both the old and new price regime. Hence, we have to infer the eﬀect by looking at comparable individuals. However, any analysis is then faced with the problem of unobserved (preference) heterogeneity, i.e., the fact that even after accounting for all observable variables, individuals remain profoundly diﬀerent. Thus, adequate means and methods for controlling this complication are called for when evaluating welfare eﬀects.
compensation approach is intellectually dishonest in that it incorporates the inefficiencies (and welfare losses) associated with trade but assumes that any redistribution can be made lump-sum without a welfare loss. 2 This would be equivalent to the case of someone wishing to show how trade lowered social welfare by calculating the welfare loss that would result from the disincentives of having to redistribute income through the income tax system but who totally ignored the welfare gain from reducing tariffs. This approach is deceptive in that it proposes a political adjustment mechanism that simply does not exist in the current political system (at least not in the United States). The political system is such that how income is originally distributed limits the degree to which a redistribution can actually be made. For these reasons then, income gains are not redistributed. Many including Arrow (1950, p.330) have concluded that “the compensation principle must be regarded as [an] unsatisfactory technique[s] for the determination of social preferences.” Woodland (1982, p. 265) concludes, “If compensation is not paid, then it is difficult to argue in favour of free trade, unless one is prepared to base the argument upon a demonstration that the nation has a social welfare function which is actually increased in value.” In addition, this technical economic interpretation of what constitutes a welfare gain is not the same as the general public’s interpretation of the meaning of this term; this difference has been used by liberalization advocates to their great advantage.
The proper sequencing and implementation are of great importance for the overall suc- cess of capital account liberalization. According to Bakker and Chapple (2002), United Kingdom lifted its capital controls in a cold-turkey manner in 1981 and an asset price bubble developed toward the end of the 1980s; similarly, Australia, Denmark, Finland, Norway, and Sweden also undertook rapid capital account liberalization during 1980s and there was also asset price boom. When growth eventually slowed, loan losses mounted rapidly in Norway, Finland, Sweden, leading to banking crises. Bacchetta and van Win- coop (1998) and Iacoviello (2002) provide empirical evidences on financial liberalization and asset price overshooting in emerging markets and west European countries. Edwards (2007) collects a broad range of country-specific studies on capital controls and capital account liberalization, e.g., Argentina, Brazil, China, India, Malaysia, Singapore, South Korea. The short-run asset price booms lead to lending booms and then huge amount of non-performing loans ex post before the economy suffers from sudden stops and cur- rent account reversals, as widely observed in the financial crises in East Asian and South America in 1990s. Such empirical facts have not yet been explained in theoretical models. Our contribution to the literature is three-folded. Similar as Aoki, Benigno, and Kiy- otaki (2006), we show that capital account liberalization improves production efficiency. As our first result, we show that due to endogenous asset reallocation, the more produc- tive agents benefit while the less productive agents lose from capital account liberalization in our model economy. Furthermore, it may be impossible to use public transfers to fully compensate the loss of those negatively affected by capital account liberalization. Our prediction on the relationship between capital account liberalization and inequality is in line with the empirical evidence of Das and Mohapatra (2003). It explains why finan- cial opening often meets fierce opposition even though it leads to efficiency gains for the economy as a whole. In this sense, capital account liberalization is desirable from the efficiency perspective but not from the welfare perspective.