rafmacalaba/datause-encoder-data huggingface dataset:
Stamp duties in Indian states - a
            case for reform
The authors review the options for
            reform of stamp duties on immovable property transfers
            collected by Indian state governments. After briefly
            reviewing some of the many administrative difficulties
            experienced with the tax, they turn to an examination of its
            economic impacts. A review of stamp duties internationally
            indicates that Indian rates are exceptionally high, at rates
            often above 10 percent. Most countries' rates are less
            than 5 percent, including a number of low and middle-income
            developing countries. With these high rates, the authors
            find that while the tax has become the third largest revenue
            source for many Indian states, it imposes high compliance
            costs on taxpayers, has been subject to a good deal of
            evasion and fraud, and the distortionary impacts appear to
            be large, reducing the responsiveness of real estate markets
            in Indian cities by discouraging transactions essential to
            the efficient growth of cities. The authors then study the
            revenue implications of lowering stamp duty rates, which
            need to be understood if reform is to be viable. Evidence
            indicates that the current high duty rates, coupled with
            weak tax administration, lead to widespread evasion of the
            tax through under-declaration. This under-declaration of
            property values directly affects collection of other taxes,
            among them, property taxes and capital gains tax. Moreover,
            it indirectly affects the collection of all taxes through
            the impact of under-declaration on the circulation of black
            money. Simulations indicate that revenues lost due to a
            lowering of stamp duty rates closer to international levels
            are quite likely to be recovered in higher collections of
            other taxes. However, these taxes would at least in part be
            collected by other levels of government. So reform could be
            made a more viable option through appropriately designed
            intergovernmental transfers.
Is environmentally-friendly
            agriculture less profitable for farmers evidence on
            integrated pest management in Bangladesh
Concerns about the sustainability of
            conventional agriculture have prompted widespread
            introduction of integrated pest management (IPM), an
            ecologically-based approach to control of harmful insects
            and weeds. IPM is intended to reduce ecological and health
            damage from chemical pesticides by using natural parasites
            and predators to control pest populations. Since chemical
            pesticides are expensive for poor farmers, IPM offers the
            prospect of lower production costs and higher profitability.
            However, adoption of IPM may reduce profitability if it also
            lowers overall productivity, or induces more intensive use
            of other production factors. On the other hand, IPM may
            actually promote more productive farming by encouraging more
            skillful use of available resources. Data scarcity has
            hindered a full accounting of IPM's impact on
            profitability, health, and local ecosystems. Using new
            survey data, the authors attempt such an accounting for rice
            farmers in Bangladesh. They compare outcomes for farming
            with IPM and conventional techniques, using input-use
            accounting, conventional production functions, and frontier
            production estimation. All of their results suggest that the
            productivity of IPM rice farming is not significantly
            different from the productivity of conventional farming.
            Since IPM reduces pesticide costs with no countervailing
            loss in production, it appears to be more profitable than
            conventional rice farming. The interview results also
            suggest substantial health and ecological benefits. However,
            externality problems make it difficult for farmers to adopt
            IPM individually. Without collective adoption,
            neighbors' continued reliance on chemicals to kill
            pests will also kill helpful parasites and predators, as
            well as exposing IPM farmers and local ecosystems to
            chemical spillovers from adjoining fields. Successful IPM
            adoption may therefore depend on institutional support for
            collective action.
State ownership - a residual role
The author reviews the state of thinking
            on the governance role of state ownership. He argues that a
            gradual transfer of operational control and financial claims
            over state assets remains the most desirable goal, but it
            needs to be paced to avoid regulatory capture, and the
            capture of the privatization process itself. In addition,
            the speed of transfer should be timed on the progress in
            developing a strong regulatory governance system, to which
            certain residual rights of intervention must be vested. In
            many countries institutional weakness limits regulatory
            capacity and reliability, yet the author's conclusion
            is that in such environments, maintaining state control
            undermines the very emergence of institutional capacity, and
            so the balance should tip toward progressively less direct
            state control. After all, what are "institutions"
            if not governance mechanisms with some degree of autonomy
            from both political and private interests? The gradual
            creation of institutions partially autonomous from political
            power must become central to the development of an optimal
            mode of regulatory governance. The author offers some
            suggestions about creating maximum accountability in
            regulatory governance, in particular creating an internal
            control system based on a rotating board representative of
            users, producers, and civic organizations, to be elected by
            a process involving frequent reporting and disclosure.
Remittances and poverty in Guatemala
The author uses a large, nationally
            representative household survey to analyze the impact of
            internal remittances (from Guatemala), and international
            remittances (from the United States) on poverty in
            Guatemala. With only one exception, he finds that both
            internal and international remittances reduce the level,
            depth, and severity of poverty in Guatemala. However, he
            finds that remittances have a greater impact on reducing the
            severity as opposed to the level of poverty in Guatemala.
            For example, the squared poverty gap-which measures the
            severity of poverty-falls by 21.1 percent when internal
            remittances are included in household income, and by 19.8
            percent when international remittances are included in such
            income. This is true because households in the lowest decile
            group receive a very large share of their total household
            income (expenditure) from remittances. Households in the
            bottom decile group receive between 50 and 60 percent of
            their total income (expenditure) from remittances. When
            these "poorest of the poor" households receive
            remittances, their income status changes dramatically and
            this in turn has a large effect on any poverty measure-like
            the squared poverty gap-that considers the number, distance,
            and distribution of poor households beneath the poverty line.
Remittances and poverty in Guatemala
# WPS3418

## **Remittances and Poverty**

**in Guatemala***

**Richard H. Adams, Jr.**

**Development Research Group (DECRG)**

**MSN MC3-303**

**World Bank**

**1818 H Street, NW Washington, DC  20433**

**Phone:  202-473-9037**

**E-Mail:** **<u>radams@worldbank.org</u>**

World Bank Policy Research Working Paper 3418, September 2004 _The Policy Research Working Paper Series disseminates the findings of work in progress to encourage the exchange of ideas about development issues. An objective of the series is to get the findings out quickly, even if the presentations are less than fully polished. The papers carry the names of the authors and should be cited accordingly. The findings, interpretations, and conclusions expressed in this paper are entirely those of the authors. They do not necessarily represent the view of the World Bank, its Executive Directors, or the countries they represent. Policy Research Working Papers are available online at http://econ.worldbank.org._

***I would like to thank Francois Bourguignon, Maurice Schiff, Alan Winters and participants in a World Bank Brown Bag seminar for helpful comments on an earlier draft, and Kalpana Mehra for fine research assistance.**
Toward a social policy for
            Argentina's infrastructure sectors - evaluating the
            past and exploring the future
Argentina was a pioneer of
            infrastructure reform in the early 1990s. The social
            dimension of infrastructure services was typically
            overlooked in the reform process. However, social
            sensitivities often resurfaced in the years that followed,
            leading to a series of ad hoc social policy measures that
            cumulatively amount to US$200 million a year. Foster
            quantifies and prioritizes the social challenges faced by
            the Argentine infrastructure sectors, evaluates how well
            existing social policies are functioning, and provides
            illustrative simulations of how certain changes in the
            design of social policy could improve the performance of
            current social policies. The author's findings are that
            current social policies do not prove to be very effective in
            targeting resources to the poor. They have no real impact on
            the distribution of income across customers. An important
            reason for this targeting failure is the tendency to
            allocate resources to all households resident in a
            particular geographical area, irrespective of socioeconomic
            status. A series of simulations that limit subsidies to
            households reaching a minimum score on a multidimensional
            poverty index show that individual targeting of this kind
            potentially leads to a more progressive distribution of
            subsidies. However, the greatest improvements in targeting
            performance would be achieved if efforts switched from
            subsidizing the use of infrastructure services to
            subsidizing connections to those services.
Foreign bank entry, performance of
            domestic banks, and sequence of financial liberalization
The openness or internationalization of
            financial services is a complex issue because it is closely
            related to structural reforms in the domestic financial
            sector with some perceived implications for macroeconomic
            stability. The authors investigate the impact of foreign
            bank entry on the performance of domestic banks and how this
            relationship is affected by the sequence of financial
            liberalization. Their data set is constructed from the
            BANKSCOPE database, including 30 industrial and developing
            countries, and covering the period from 1995 to 2002. The
            authors apply panel data regressions by pooling all
            countries together, and by grouping countries according to
            the sequence of their financial liberalization. One
            observation based on descriptive analysis is that the degree
            of openness to foreign bank entry varies a great deal, which
            is not correlated with average income levels or with GDP
            growth. Second, the sequence of financial liberalization
            matters for the performance of the domestic banking sector:
            After controlling for macroeconomic variables and grouping
            countries by their sequence of liberalization, foreign bank
            entry has significantly improved domestic bank
            competitiveness in countries that liberalized their stock
            market first. In these countries, both profit and cost
            indicators are negatively related to the share of foreign
            banks. Countries that liberalized their capital account
            first seem to have benefited less from foreign bank entry
            compared with the other two sets of countries.
Export variety and country productivity
The authors study the link between
            export product variety and country productivity based on
            data from 34 industrial and developing countries, from 1982
            to 1997. They measure export product variety by the share of
            U.S. imports on the set of goods exported by each sampled
            country relative to the world. It is a theoretically sound
            index which is consistent with within-country GDP
            maximization, as well as cross-country comparison. They
            construct country productivity based on relative endowments
            and product variety. Increases in output product variety
            improve country productivity as the new mix of output may
            better use resources of the economy, and improve allocation
            efficiency. Such effects depend on the elasticity of
            substitution in production between the different varieties.
            The more different the varieties are in terms of production,
            the more efficient it is to use the endowments of the
            economy when a new variety is available, which leads to
            productivity gains. In addition, as suggested in the
            literature, export product variety depends on trade costs,
            such as tariffs, distance, and transport costs. Such trade
            cost variables are used as instruments to help the authors
            identify the effects of export variety on country
            productivity. Empirical evidence supports their hypothesis.
            Overall, while export variety accounts for only 2 percent of
            cross-country productivity differences, it explains 13
            percent of within-country productivity growth. A 10 percent
            increase in the export variety of all industries leads to a
            1.3 percent increase in country productivity, while a 10
            percentage point increase in tariffs facing an exporting
            country leads to a 2 percent fall in country productivity.
Have consumers benefited from the
            reforms in the electricity distribution sector in Latin America
The authors bring new empirical evidence
            on the impact of the choice of ownership and regulatory
            regime on firms' productivity and prices paid by
            consumers. They collect the evidence from a sample of
            electricity distribution companies in Latin America. The
            authors rely on estimations of labor and operation and
            maintenance (O&M) input requirement functions using
            alternative econometric approaches. Their main conclusions
            are: 1) Private firms perform better (approximately 30
            percent) than public firms. 2) The regulatory regimes
            matter, so that price-cap regulated firms do better than
            rate-of-return regulated firms, and firms regulated under
            hybrid regimes have intermediate performance. 3) Private
            firms operating under rate of return are at most as
            efficient as public firms. 4) There is no clear pattern of
            differences in electricity prices according to the
            regulatory regime. 5) Final prices fell in general but the
            drop did not match the productivity gains, implying that the
            operators and the state share some of the gains in the form
            of rents and higher tax revenue, respectively.
Have consumers benefited from the
            reforms in the electricity distribution sector in Latin America
WPS3420

# **Have Consumers Benefited from the Reforms in the Electricity Distribution Sector in Latin America?**<sup>**1**</sup>

## Antonio Estache

World Bank and ECARES, Université Libre de Bruxelles

## Martin Rossi

Department of Economics, University of Oxford

### Abstract

This paper brings new empirical evidence on the impact of the choice of ownership and regulatory regime on firms’ productivity and prices paid by consumers. The evidence is collected from a sample of electricity distribution companies in Latin-America. For efficiency, we rely on estimations of a parametric labor and operation and maintenance (O&M) input requirement functions using alternative. We then analyze the correlation between prices and productivity changes. The main conclusions of the paper are: a) private firms perform better (approximately 30%) than public firms; b) the regulatory regimes matter; c) private firms operating under rate of return are at most as efficient as public firms; d) there is no clear pattern of differences in electricity prices according to the regulatory regime; and e) final prices fell in general but the drop did not match the productivity gains, implying that the operators and the state share some of the gains in the form of rents and higher tax revenue, respectively.

> 1 We are grateful to Simon Cowan, Martin Rodriguez-Pardina, Sergio Perelman and Lourdes Trujillo for useful discussions in the preparation of this paper. Any mistake is ours.

1
Designing performance: the
            semi-autonomous revenue authority model in Africa and Latin America
During the past decade, diverse
            developing countries have introduced radical reforms in
            their collection of taxes. In more than 15 countries,
            traditional tax departments have been granted the status of
            semiautonomous revenue authorities (ARAs), which are
            designed with a number of autonomy-enhancing features,
            including self-financing mechanisms, boards of directors
            with high-ranking public and private sector representatives,
            and sui generis personnel systems. The author addresses gaps
            in the public management and tax administration literatures
            by closely examining ARA reforms in Kenya, Mexico, Peru,
            South Africa, Uganda, and Venezuela from their inception to
            the early 2000s. Using the comparative case study method, he
            tackles three questions. First, what has motivated the wave
            of ARA reforms over the past decade? The author argues that
            from a public management perspective, reformers intended to
            use autonomy to enhance bureaucratic performance in
            low-capacity public sectors. Second, is there a connection
            between autonomy and performance? Focusing on revenue
            collection, compliance management, taxpayer services, human
            resource management, and administrative costs, the author
            suggests that autonomy is associated with higher levels of
            performance. He also makes the case that higher levels of
            autonomy are associated with higher levels of performance.
            Third, if there is a connection between autonomy and
            performance, which specific design features matter most and
            why? In spite of the popularity of the ARA reform, there is
            no consensus on best practice in organizational design. The
            author offers hypotheses based on the cases about why
            certain designs work better than others, and makes specific
            recommendations for the next generation of ARA reforms.
Measuring the risk on housing
            investment in the informal sector: theory and evidence from
            Pune, India
The authors provide an economic
            framework to analyze investment in informal housing in
            developing countries. They consider a simple model of
            investment in the housing market where investors can choose
            between two sectors-the formal sector, where physical
            investment faces no risk of destruction, and the informal
            sector, where investment in each period is subjected to an
            exogenous risk of destruction. Construction costs differ
            between the two sectors. All households are renters. Renters
            shop for dwelling attributes and do not care about the
            sector (formal or informal) itself. The model implies that
            returns on investment, measured by the rent-to-value ration,
            will be higher in the informal sector. The authors use a
            survey conducted by the World Bank in Pune, India in 2002.
            The sample comprises 2,850 households. This survey had the
            peculiarity of asking the households, regardless of tenure
            status, questions about the market rent and value of their
            dwelling. Thus they can calculate individual rates of return
            for each unit without facing the typical selection bias
            problems. Comparing the distributions of returns in the
            informal and formal sectors, the authors obtain the
            following results: 1) Rates of return are significantly
            higher in the informal sector, as predicted by the model. 2)
            These figures imply a perceived risk on housing investment
            in the informal sector equivalent to an annual destruction
            rate ranging between 1 and 2 percent. 3) The two
            distributions of rates of return present highly
            idiosyncratic components and are not well explained by
            variables proxying either the strength of informal property
            rights or lower perceived risks of eviction.
Can student loans improve
            accessibility to higher education and student performance An
            impact study of the case of SOFES, Mexico
Financial aid to students in tertiary
            education can contribute to human capital accumulation
            through two channels: increased enrollment and improved
            student performance. We analyze the quantitative importance
            of both channels in the context of a student loan program
            (SOFES) implemented at private universities in Mexico. With
            regard to the first channel, enrollment, results from the
            Mexican household survey indicate that financial support has
            a strong positive effect on university enrollment. Given
            completion of upper secondary education, the probability of
            entering higher education rises 24 percent. Two data sources
            are used to investigate the second channel, student
            performance. Administrative data provided by SOFES are
            analyzed using a regression-discontinuity design, and survey
            data enable us to perform a similar analysis using a
            different control group. Empirical results suggest that
            SOFES recipients show better academic performance than
            students without a credit from SOFES. However, the results
            cannot be interpreted as a purely causal impact of the
            student loan program, since the impacts also could reflect
            (self-) selection of students.