WIDERAngle

Expert commentary from our network

Watts happening to work? The labour market effects of South Africa’s electricity crisis

by Haroon Bhorat, Tim Köhler
two miners with shovels
In South Africa, the power grid undergoes rotational, scheduled outages—or rolling blackouts—most commonly referred to as load shedding. Load shedding is primarily a consequence of frequent breakdowns at the national utility. These are due to a combination of poor long-term planning, a lack of financial resources, rampant state capture and corruption, and aging coal-fired power stations. Four of every five (80%) of South Africa’s coal-fired plants are past their mid-life cycle. Power outages...

How to get back on track to ending poverty – the imperative for a livable planet

by Luis Felipe López-Calva
We are off track to end poverty. Despite remarkable progress over the past few decades, the goal of eradicating poverty remains elusive, and SDG1: End poverty in all its forms everywhere is out of reach. While more than a billion people have been lifted out of poverty, the pace has significantly slowed. If we persist with business-as-usual, by 2030 around 7% of the world’s population will still live in extreme poverty—more than double our target of 3%.Unsurprisingly, this challenge is...

Just transitions and the importance of social protection reforms for ambitious climate action

by Christina Dankmeyer, Katrin Gasior, Gemma Wright
As greenhouse gases once again climb to record levels, countries are under pressure to make the move to a low-carbon economy. Policies that move in this direction are needed to mitigate against the worst impacts of climate change, but policy choices will have winners and losers. As it is crucial to consider the effects of climate change mitigation policies on various population groups, we explore two policy options —carbon pricing and removal of fossil fuel subsidies. In our latest...

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Mapping economic stability for countries in the Global South
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In 2024, central banks worldwide are confronted with the challenges of juggling inflation control, economic growth, and the preservation of financial...

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Uganda’s tax system isn’t bringing in enough revenue, but is targeting small business the answer?
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Uganda, with a fiscal deficit of 5.6% in 2023, has increasingly turned to local resources to make up for its revenue shortfall since the World Bank...

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Are Sovereign Wealth Funds fit for purpose in Africa?

Sovereign Wealth Funds (SWFs) have become a symbol of national success and a means for global, commercial and geopolitical influence. But how well do...

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Cash Plus: Towards poverty reduction in Zambia
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The Zambian government wants to reduce poverty by 20% by 2030. To make this happen, the government reformed their national cash transfer programmes...

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Reforming taxation in Kenya to reduce debt distress
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Improving tax systems is important for multiple reasons. For Kenya, finding ways to mobilize domestic revenue streams is critical to cutting the...

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Financing development goals in times of crisis

Pursuing the global development agenda will require genuine commitment from political leaders and significant stepping-up of government efforts. But...

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Modelling to influence poverty and inequality in Zanzibar: Latest addition to the SOUTHMOD programme
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ZANMOD, the tax-benefit microsimulation model for Zanzibar, was launched in November 2023. The model will aid local authorities and researchers in...

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Realizing socioeconomic rights with a limited budget

The South African constitution is considered progressive and transformative in intention due to its inclusion of socioeconomic rights, such as the...

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Pre-colonial politics affects tax compliance in modern day Uganda

Parts of Uganda that had centralised political systems before colonial rule are more likely to have higher rates of voluntary tax compliance. Merima...

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Overcoming the challenge of illicit financial flows: Four pieces of advice for policymakers
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From profit shifting to sanction evasion, illicit financial flows divert funds away from essential poverty-fighting and infrastructure programs. A...

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On the road to fairer societies in Asia and the Pacific region: Four focus areas on center stage

A recent panel discussion at the United Nations Economic and Social Commission for Asia and the Pacific (ESCAP) in Bangkok set out to identify policy...

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Four things to consider to improve public revenues in the Global South: New findings from the Government Revenue Dataset

Across the Global South, governments continue efforts to increase domestic revenues and capacity for public spending. As concerns over debt distress...

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Lessons for tax policy from the WIDER Development Conference in Oslo
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The annual WIDER Development Conference held this year in Oslo concentrated on domestic revenue mobilization (DRM). The 2.5-day hybrid event...

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From tax data to inclusive policies: How collaboration can help
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UNU-WIDER has worked for several years in collaboration with sub-Saharan African revenue authorities to facilitate the analysis of digital tax data...

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The COVID-19 TERS policy saved at least 2 million jobs: But not without some unintended results

About three years have passed since the South African government introduced the COVID-19 Temporary Employer-Employee Relief Scheme (TERS) in response...

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Oslo conference turns the spotlight on sustainable development financing
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With the deadline for achieving the UN’s Sustainable Development Goals just seven years away, there is an increasing sense of urgency over the...

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How to support the emergence of effective tax systems

There has been a revival of interest in the state’s role in economic development. Recent research argues that the most successful economies are those where effective states provide crucial public goods and services. The historical emergence of...

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Will a revenue boom support development in resource-rich economies?

The post-COVID-19 economic recovery and Russia’s war with Ukraine have caused some natural resource prices to reach new highs. Although forecasting...

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Unlocking efficiency – overcoming challenges in South Africa's rail freight sector
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The South African rail freight sector is currently facing a crisis of operational efficiency, which is having a significant economic impact. In the...

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Paralyzing debt burden threatens Africa’s largest economy
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Apart from a ‘badly flawed’ national election, insecurity, and mass exodus of its young talents to the Global North (locally known as Japa), a...

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What determines tax revenues mobilization?
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Tax revenues and political institutions placing constraints on the executive power may reinforce each other over time and this may also bring a shift...

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SOUTHMOD family extended: Welcome to the three new Latin American teams

How would progressive income taxation affect income inequality in Bolivia? What are the costs and benefits of implementing a state pension in Colombia...

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$1 trillion in the shade: The annual profits multinational corporations shift to tax havens continues to climb and climb

About a decade ago, the world’s biggest economies agreed to crack down on multinational corporations’ abusive use of tax havens. This resulted in a 15...

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From Monterrey to Addis Ababa, and what has happened since?
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The importance of domestic revenue mobilization and taxation for sustainable development is widely acknowledged in global development discussions, but...

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Direct support to small scale farmers reduces poverty: What Zambia is doing right

Over half of Zambia’s population lived below the national poverty line in 2015. In rural areas, where 89% of households are engaged in agriculture...

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Secure research data lab in Uganda: A game changer for efficient and fair taxation

In May 2022, the Uganda Revenue Authority (URA) and UNU-WIDER collaboratively launched a secure research data laboratory facility in Kampala, Uganda...

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New global estimates on profits in tax havens suggest the tax loss continues to rise

The world has been trying to curb profit shifting to tax havens for a decade, but consistent time series evaluating the impact of these reforms have...

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Climate resilience and sustainable sovereign debt
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2022 is already a record-breaker in the number of climate change-related events, and developing countries must now pay for the repairs and remediation...

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New country on the SOUTHMOD map: Meet our tax-benefit microsimulation team in Rwanda!
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How can Global South countries improve their tax and social protection systems? One way is to take advantage of tools that help assess the impact of...

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Teamwork and capacity strengthening to promote development: The case of Mozambique

Designing and implementing public policies requires caution to guarantee the best use of scarce resources, especially in middle- and lower-income...

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Global tax reforms, net-zero, and domestic revenue: Food for thought from the DRM programme
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Domestic revenue mobilization (DRM) and taxation have gained prominence lately on the global agenda, most recently with the resolution for the United...

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Empirical research is crucial for better tax enforcement in the developing world
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I had the privilege to participate in the UNU-WIDER Winter School as one of the lecturers. In this blog, I explain my main takeaways for students and...

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Fintech and domestic savings: A perfect match coming true in sub-Saharan Africa
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Financial technology (FinTech) is a major force disrupting the structure of financial services in sub-Saharan Africa (SSA) and enabling access of...

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Inequality, fiscal space, and crisis response — A matter of priority, affordability, or both?
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In response to the COVID-19 pandemic, governments financed more than 5000 fiscal support policies worldwide in 2020–21. The pandemic response is an...

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Tools for effective tax administration
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The importance of conducting high-quality analysis for policy advice cannot be understated. The UNU-WIDER Winter School for tax policy research...

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Lives can be improved when policymakers and researchers collaborate
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My motivation for doing economics research comes from the wish to see every human being have their basic needs met and enjoy their life. My interest...

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Experiences from UNU-WIDER Winter School 2022: One of the best global training programmes in tax research
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Across Africa, governments are now waking up to the fact that taxation targets or economic development goals will not be met without policies that are...

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Sales recovered faster from the pandemic than employment: Evidence from tax administrative and survey data in Zambia

Like most other countries, the government of Zambia introduced restrictions to control COVID-19, which considerably curtailed normal economic activity...

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State assigned property rights and revenue collection in sub-Saharan Africa

Across sub-Saharan African (SSA) countries there are striking differences in citizen willingness to pay taxes. For example, in Mali, Senegal, and...

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Tax revenues and tax capacity in sub-Saharan Africa

African countries raise lower amounts of tax as a share of national income (GDP) than other countries. Researchers are interested in understanding why...

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What can the GRD do for policymakers?
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A few months ago, I was asked to deliver a lecture at the Vienna Institute for International Economic Studies on the UNU-WIDER Government Revenue...

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Indonesia, the developer’s dilemma, and Vision 2045

According to the World Bank, Indonesia has reached the upper-middle income status in 2019 after spending almost two decades in the lower-middle income...

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Confronting low domestic savings in Africa

What are the linkages between national savings and sustainable economic growth? Why are there differences in the amounts of savings between different...

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The tortoise defeats the hare: Does moderate outlast rapid growth in domestic revenue?

The past four decades have seen marked improvements in the collection of domestic revenue (tax and non-tax revenues) in many countries of the Global...

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Corona pandemic revealed gaps in African social security systems
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Millions of Africans lost their jobs as a result of the coronavirus pandemic, but state social security systems were of little help to people who lost...

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Ending aid dependency: Taxation in developing countries can be improved through collaboration

Finland aims to raise the amount of its development assistance to 0.7% of GDP, and this goal has good grounds. But how can we make sure that the...

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The pandemic and Africa's social safety net

The COVID-19 pandemic has shown that African tax and social-benefit systems are currently ill-equipped to protect households from sudden income losses...

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An African in Africa: New perspectives on travelling for research
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Working for an international organisation presents a host of challenges, given the vast nature of tasks that one must surmount in a fast paced and...

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Efforts to protect the poor during COVID: How five African countries fared

The number of people living in poverty around the world is estimated to have increased by half a billion people due to the COVID-19 crisis. The...

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From sub-Saharan Africa to Viet Nam and Ecuador, how one model is used to improve social protection

Are there enough tax payers to generate the revenue needed by governments to reduce poverty? How adequate are the social security arrangements that...

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Dr Pia Rattenhuber on inequality in crises — an interview

How do crises such as the COVID-19 pandemic influence inequality and the other way around? This year’s UN Day Dresden put a spotlight on “Inequalities...

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Working together to better understand how COVID-19 affects poverty and inequality

In summer 2020 the SOUTHMOD team set out, with partners, to analyse the impact of government policies on protecting households from getting poorer and...

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Unlocking the mystery of domestic savings: What difference do they make?

The socioeconomic fallout from the ongoing COVID-19 pandemic has brought to the fore discussions on domestic resource mobilization (hereafter DRM)...

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Co-creation for fair and efficient taxation: Research recommendations to improve policies

How can we determine the taxation of wage earners or multinational corporations in a fair manner? Will simplifying tax administration help increase...

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Social protection at a crossroad
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How can we ensure a resilient and inclusive recovery from COVID-19? How can we hold on to the target of eradicating poverty and hunger by 2030, with...

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Mozambique's difficult decade: Three lessons to inform next steps

At the start of the last decade, Mozambique’s prospects looked stellar. Following from the early 1990s, when peace finally arrived after a devastating...

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How global tax dodging costs lives: New research shows a direct link to increased death rates

Tax abuse is an expensive business. According to a recent report by the Tax Justice Network, avoiding or evading tax deprives governments across the...

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Ecuador’s social protection system failed during the pandemic: It needs a rethink

Household incomes in Ecuador were badly hit by the pandemic, despite the government’s emergency grant to families. H Xavier Jara Tamayo (University of...

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Data for better tax policy analysis: Introducing the latest version of the Government Revenue Dataset
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Thanks to the updated version of the Government Revenue Dataset (GRD) we are now able to gain a clear picture of tax and other revenue trends in over...

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The Nordic Model — lessons for Sri Lanka
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Sri Lanka, like the Nordic countries, is a social democratic nation with a strong welfare state. It is classified as a ‘high human development’...

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Why should I care about economic growth?
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Director of UNU-WIDER, Professor Kunal Sen is a world leading expert in development economics and led on ESID’s research into economic growth. In this...

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Does exchange rate volatility amplify existing inequalities in South Africa?

Even though poverty and inequality have been of overriding concern in South Africa’s development policies and programmes since its democratization in 1994, measures of poverty, inequality, and related phenomena in the country do not show a clear...

Research Brief
Unlocking a regional plastics value chain between Mozambique and South Africa

Plastics are universal and integrated into different sectors of the economy. Industrial policy requires countries to look at moving up the value chain and producing progressively more sophisticated products to contribute to improved economic...

Research Brief
Special economic zones in Zambia and South Africa

East Asia’s successful experience in accelerating the process of industrial development with SEZs paved way for the use of SEZs as policy instruments in Africa. In southern Africa, Zambia and South Africa instituted SEZs in legal and institutional...

Research Brief
Extreme inequalities

South Africa is, by most contemporary measures, the most unequal country in the world. Yet, relatively little attention has been given to country’s wealth inequality. It is crucial to accurately measure the concentration of wealth inequality over...

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Studying COVID-19 through the lens of microsimulation: The role of tax and benefit policies in alleviating poverty and inequality

As the crisis caused by the COVID-19 pandemic evolves, developing nations are struggling to deliver economic assistance and public services to their...

Research Brief
Monetary policy and firm size in South Africa

Monetary policy affects the real economy through various channels, including the interest rate, exchange rate, credit, and asset price channels. The credit channel has recently received considerable attention. Small firms are more sensitive to...

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Wage inequality in post-apartheid South Africa

Much work has been done on inequality in South Africa, but to date the literature that assesses the dynamic response of income or wealth distribution to economic policy actions is almost non-existent. This information gap is caused by data...

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Are credits or deductions better in public health spending?

The impact of medical deductions and medical credits on income inequality is a subject of discussion in South Africa, as well as in many other countries, raising critical questions about the fairness of the medical tax system and the impact on...

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International tax research: Why does more than numbers matter

Can tax research be inspiring? Looking back at the three years of collaboration between UNU-WIDER and the Uganda Revenue Authority (URA), the answer...

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Solutions for designing better special economic zones programmes in Africa

Special economic zones (SEZ) in Africa are generally regarded as underperforming relative to their peers in the rest of the world. To explain this underperformance and to support success in the future it is important to analyse the key features and...

Research Brief
Turnin’ it up a notch

Since the end of apartheid, South Africa’s economic challenges have disrupted efforts to establish a society of inclusive growth and prosperity. Understanding how South Africa can break the pattern of sluggish growth, high unemployment, inequality...

Research Brief
Estimating tax gaps in the non-financial sector

Many governments, particularly those in developing countries, have set an objective to improve tax revenue mobilization to offer more and better public services to their citizens. To develop effective revenue-raising strategies it is necessary to...

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Fiscal multipliers and debt dynamics using a DSGE approach

Much of the research on the impact of fiscal policy shocks on macroeconomic outcomes (e.g., fiscal multipliers) uses reduced-form modelling approaches such as vector auto-regressions to obtain empirical results. In a recent study1, we used this...

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Policy implications of empirically estimated fiscal multipliers for South Africa

Despite the frequent use of fiscal policy for stabilization purposes, there remains significant uncertainty regarding the impact of fiscal policy decisions on macroeconomic outcomes. This impact is quantified by calculating fiscal multipliers. A...

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In Conversation with Deepak Nayyar on ‘Resurgent Asia’: FP2P Podcast and transcript
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Duncan Green: I recently skyped Deepak Nayyar, Professor of Economics at India’s Jawaharlal Nehru University (JNU) to discuss his new book, Resurgent...

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Solving the PhD puzzle: My experience as a visiting PhD Fellow
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I am now in my fourth year as a PhD student in development studies at SOAS, University of London, working on my thesis, ‘The Dynamics of Chinese...

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Book review of Resurgent Asia: Diversity in Development: Completing a trilogy on Asia’s transformation
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Deepak Nayyar — economist, thinker, leading scholar — has written yet another splendid book. Resurgent Asia: Diversity in Development, together with...

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Can trade in services bolster regional development in Southern Africa?

Service exports are the fastest growing portion of world trade and now account for nearly a quarter of global exports. Tradable services contribute to economic growth and development by bolstering industrial capabilities, facilitating productivity...

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The case for universal social insurance in Latin America
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Access to effective social insurance in Latin America is typically determined by workers’ status in the labor market – whether they have formal or...

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Revenue losses from tax-motivated mispricing in South Africa

New research provides the first direct evidence of tax-motivated transfer mispricing in a developing country. Using highly detailed firm-level customs data from the tax authority, the analysis calculates the difference between legitimate estimates of...

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How multinationals continue to avoid paying hundreds of billions of dollars in tax: New research
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Tax havens have become a defining feature of the global financial system. Multinational companies can use various schemes to avoid paying taxes in...

Research Brief
The impact of tax havens on South African revenue

The study uses a comparative analysis of foreign-owned firms operating in South Africa to show that firms with a parent registered in a tax haven tend to report 80% less in profits than similar firms without a parent in a tax haven. This is highly...

Policy Brief
Social protection, government revenue and microsimulation in developing countries

Social protection has attracted increasing interest in developing countries in recent decades and policies have been initiated in all developing regions. When countries build up their social protection systems, they need reliable information and...

Research Brief
Firms with high-growth episodes in South Africa

The analysis of firm growth has been a topic of consistent economic interest as a growing body of literature has lent support to the possibility that the majority of growth and new employment creation is the result of a small sub-sector of high...

Research Brief
Dancing with dragons

China’s growing edge in export manufacturing has caused concern for low-income and middle-income countries seeking to develop robust manufacturing sectors. China’s recent transition from an exporter of lower-tech goods, such as garments, to more...

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Industrial policy in the 21st century: The challenge for Africa
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Why is there so little industry in Africa? Does it matter? What can be done about it? These were questions I put to Finn Tarp and Louis Kasekende...

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Balancing tax collection and equality

In a democratic system, taxation is a critical part of the social contract between the state and its citizens. The tax system can be used to help address the unacceptably high levels of poverty, inequality, and unemployment in South Africa. An...

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How can developing countries pay for the SDGs?

With official development assistance under strain, achieving the Sustainable Development Goals will require developing countries to rely increasingly...

Research Brief
Deepening regional integration in Southern Africa

Regional integration is making steady progress in Southern Africa, leading to the development of regional value chains (RVCs) that could strengthen the competitiveness of the region. Importantly, the development of RVCs also creates pressure for...

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Data for development: Building an economy of inclusion in South Africa
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As the largest economy in sub-Saharan Africa, South Africa’s successes and failures spill over into the broader region. Today, as South Africans face...

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Narendra Modi’s performance on the Indian economy: Five key policies assessed
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When Narendra Modi became India’s prime minister in spring 2014 the Indian economy was in the doldrums. There was a clear policy paralysis in India’s...

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India’s General Elections 2019: The potential electoral consequences of demonetisation
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In the campaign leading up to the Lok Sabha elections in spring 2014, one of the more important promises that Narendra Modi made was to ‘clean up’ the...

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How can developing countries deliver effective public financial planning?

In many less developed countries, there is little problem identifying the need for public investment in programmes aimed at improving things such as...

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From Africa rising to rising debt in Africa: The looming debt crisis
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Africa’s rising public debt continues to attract increased attention regionally and internationally. The narrative about Africa seems to have...

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Developing countries would benefit from improved tax collection: What can help?

The ability to raise revenues from taxes – called “fiscal capacity” – is a crucial aspect for the functioning of any state. Being able to tax citizens...

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Revenue data like you’ve never seen it before: Introducing the GRD Explorer
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Let’s face it, data is important. It sits at the core of almost everything that we in the development economics research community do. However, the...

Policy Brief
Inequality in Mexico

Since 1989, inequality in Mexico has risen, declined, and risen again. The evolution of labour income inequality is at the core of this pattern. To reverse the current trend of rising inequality, access to secondary and tertiary education should...

Policy Brief
Inequality dynamics in China

In the late 1970s, China embarked on a major programme of economic transition and reform. Since then, China’s economy has been transformed from a socialist planned economy to a predominately market economy characterized by a combination of state...

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Research that matters: A report from the stakeholder workshop - 15 November 2018, Pretoria, South Africa
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I found myself in the third-floor conference rooms of a Pretoria hotel for a meeting with economists, researchers, and policymakers involved in the SA...

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The ins and outs of African industrialization: UNU-WIDER provides open access to a wealth of information
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The question ‘why is there so little industrialization in Africa?’ has been a key focus of UNU-WIDER researchers and research partners for the last...

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Rethinking African industrialization on another Africa Industrialization Day
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This week I attended the 28th Africa Industrialization Day at the United Nations Headquarters in New York. Even sympathetic readers may reasonably ask...

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Developing a microsimulation model for Mozambique – from inception to impact

The tax-benefit microsimulation model developed for Mozambique, MOZMOD, has proved to be valuable in analysing the impacts and budget implications of...

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