http://www.oxfamblogs.org/fp2p/?p=11383 duncan green poverty to power oxfam development Wed, 22 May 2013 17:17:35 -0500 http://wordpress.org/?v=2.8 hourly 1 http://www.oxfamblogs.org/fp2p/?p=11383&cpage=1#comment-221789 Nicholas Freeland Wed, 22 Aug 2012 16:41:56 +0000 http://www.oxfamblogs.org/fp2p/?p=11383#comment-221789 Many thanks for this excellent article, full of cogent analysis and pertinent recommendations. I would, however, like to make one observation on what you refer to as “first-best” and “second-best” responses. You define the “first-best” option as being to perfectly target all the recovered resources from subsidy removal to the poorest in the form of social transfers (as with BLT in Indonesia). But this is “first-best” only in an idealised Utopia. Our real world, as the rest of the article makes plain, is not like that. First, it is impossible to accurately identify the poorest; second, even if you could, they would not be the poorest for very long; and third, you will never get political support for such an approach since you are essentially telling rich and middle-class voters (a powerful majority) that you are depriving them of the benefits of the subsidy, and giving all of the proceeds to someone else. In the real world, therefore, I would suggest that the “best” solution (better than your “second-best” option of consumer food subsidies) is to spread the benefits of reform equally across society by targeting transfers universally to groups who are generally perceived as being deserving: children, pregnant women, the elderly and those with disability. These groups are much more easily identifiable, so the dangers of corruption and politicisation are minimised; and the whole political economy argument is turned on its head, since support for the reforms from the middle class and the wealthy becomes much more likely (it was decidedly not the poorest who were protesting outside Indonesia’s parliament or in Nigeria’s urban centres earlier this year). Giving the same to everyone is already far more equitable than giving everything to the wealthy (as subsidies tend to), but it will also be much more popular than giving everything to the poorest (which is impossible anyway), thus making reform much more palatable. The best way to help the poor is not necessarily to target the poor! Many thanks for this excellent article, full of cogent analysis and pertinent recommendations. I would, however, like to make one observation on what you refer to as “first-best” and “second-best” responses. You define the “first-best” option as being to perfectly target all the recovered resources from subsidy removal to the poorest in the form of social transfers (as with BLT in Indonesia). But this is “first-best” only in an idealised Utopia. Our real world, as the rest of the article makes plain, is not like that. First, it is impossible to accurately identify the poorest; second, even if you could, they would not be the poorest for very long; and third, you will never get political support for such an approach since you are essentially telling rich and middle-class voters (a powerful majority) that you are depriving them of the benefits of the subsidy, and giving all of the proceeds to someone else.
In the real world, therefore, I would suggest that the “best” solution (better than your “second-best” option of consumer food subsidies) is to spread the benefits of reform equally across society by targeting transfers universally to groups who are generally perceived as being deserving: children, pregnant women, the elderly and those with disability. These groups are much more easily identifiable, so the dangers of corruption and politicisation are minimised; and the whole political economy argument is turned on its head, since support for the reforms from the middle class and the wealthy becomes much more likely (it was decidedly not the poorest who were protesting outside Indonesia’s parliament or in Nigeria’s urban centres earlier this year). Giving the same to everyone is already far more equitable than giving everything to the wealthy (as subsidies tend to), but it will also be much more popular than giving everything to the poorest (which is impossible anyway), thus making reform much more palatable. The best way to help the poor is not necessarily to target the poor!

]]> http://www.oxfamblogs.org/fp2p/?p=11383&cpage=1#comment-219376 pushpanth Tue, 21 Aug 2012 09:02:20 +0000 http://www.oxfamblogs.org/fp2p/?p=11383#comment-219376 This is a very timely issue of critical importance. I liked the way it brings together core aspects of this debate so well, along with sharp and useful statistics. Whilst i agree that any withdrawal of subsidy for fossil fuel can have indirect negative impact on households living in poverty and therefore cash transfers by other means is essential, I would also urge that other innovative approaches in developing countries should be considered .The example below gives one other innovative opportunity for the UK government to see how it can support good efforts in combating Climate Change as a part of its port folio. At this moment of time, I am indeed involved in one such initiative. The Karnataka Growers Federation with more than 50000 members consisting mostly of small holders is supported by Centre for Social Markets in Bangalore ,India, in initiating an innovative effort that will quantify the importance of shade grown Coffee plantation in regulating local ecological balance in the three districts of Southern Karnataka region: Hassan,Chikkamaglur.and Kodagu districts. A powerful partnership with the globally recognized, Pavan Sukhdev`s research consultancy –Green initiatives for sustainable Tomorrow; Forestry College at the cutting edge of such work in the local district,Kodagu and a mass based organization like KGF- is enabled by Centre for Social Markets, in Bangalore, testing new grounds and responding to new political realities in India- please see http://www.csmworld.org/Climate-Change/sustainable-coffee.html Indeed this work is being popularized with a second walk I am engaged in: http://www.oxfam.org.uk/get_involved/campaign-with-us/north-of-england-blog?type=mostpopular –I invite one and all to join and support this Gandhian and Fairtrade inspired walk through your blog-If I may, Duncan. This is a very timely issue of critical importance. I liked the way it brings together core aspects of this debate so well, along with sharp and useful statistics. Whilst i agree that any withdrawal of subsidy for fossil fuel can have indirect negative impact on households living in poverty and therefore cash transfers by other means is essential, I would also urge that other innovative approaches in developing countries should be considered .The example below gives one other innovative opportunity for the UK government to see how it can support good efforts in combating Climate Change as a part of its port folio.
At this moment of time, I am indeed involved in one such initiative. The Karnataka Growers Federation with more than 50000 members consisting mostly of small holders is supported by Centre for Social Markets in Bangalore ,India, in initiating an innovative effort that will quantify the importance of shade grown Coffee plantation in regulating local ecological balance in the three districts of Southern Karnataka region: Hassan,Chikkamaglur.and Kodagu districts. A powerful partnership with the globally recognized, Pavan Sukhdev`s research consultancy –Green initiatives for sustainable Tomorrow; Forestry College at the cutting edge of such work in the local district,Kodagu and a mass based organization like KGF- is enabled by Centre for Social Markets, in Bangalore, testing new grounds and responding to new political realities in India- please see
http://www.csmworld.org/Climate-Change/sustainable-coffee.html
Indeed this work is being popularized with a second walk I am engaged in:
http://www.oxfam.org.uk/get_involved/campaign-with-us/north-of-england-blog?type=mostpopular –I invite one and all to join and support this Gandhian and Fairtrade inspired walk through your blog-If I may, Duncan.

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