Expenditure Categories Research Articles

Effect of Government Capital Expenditure on Manufacturing Sector Output in Nigeria

<p class="ber"><span lang="EN-GB">The study investigates the relationship between government expenditure and manufacturing sector output in Nigeria. Government expenditure is disaggregated into capital and recurrent with a view to analyse the relative effect of these categories of government expenditure with emphasis on the capital component. The study employed time series data from 1970 to 2013. Data on manufacturing sector output, capital and recurrent expenditure, nominal and real Gross Domestic Product (GDP), exchange rate and interest rate were collected from Statistical Bulletin and Annual Report and Statement of Accounts published by the Central Bank of Nigeria (CBN). Econometric evidence revealed stationarity of the variables of interest at their first difference while the Johansen cointegration approach also confirms the existence of one cointegrating relationship at 5 percent level of significance. In addition, error correction estimates revealed that while government capital expenditure has positive relationship with manufacturing sector output in Nigeria, recurrent expenditure exerts negative effect on manufacturing sector output. The results showed that one per cent increase in government capital expenditure resulted in an increase of 11.2 per cent in manufacturing sector output while recurrent expenditure decreases it by 26.9 per cent. This reveals that government capital expenditure has positive impact on manufacturing sector output. The study therefore suggests that larger percentage of government expenditure in the annual budget should be on capital component coupled with improved implementation of expenditure policies rather than recurrent expenditure which does not really have a significant impact on the manufacturing sector.</span></p>

Membership in the Euro Area and Fiscal Sustainability. Analysis Through Panel Fiscal Reaction Functions

We estimate various panel fiscal reaction functions, including those of the main categories of general government revenue and expenditure for 12 Euro area member states over the 1970-2013 period. We find that in the peripheral countries where sovereign bond yields decreased sharply in the years 1996-2007, fiscal stance ceased to respond to sovereign debt accumulation. This was due to lack of sufficient adjustment in government non-investment expenditure and direct taxes. In contrast, in the core member states ,which did not benefit from yields’ convergence related to the Euro area establishment, responsiveness of fiscal stance to sovereign debt increased during 1996-2007. It was achieved mainly through pronounced adjustments in government non-investment expenditure. Our findings are in accordance with predictions of theoretical model by Aguiar et al. (2014) and are robust to various changes in modelling approach.

English

The study was undertaken during 2013 and 2014 in Jaipur District of Rajasthan with the objectives to examine the input-output relationships and assess the resource use efficiency in milk production. The study covered 100 commercial dairy farms. The results of Cobb-Douglas production function revealed that expenditure on dry fodder and green fodder for small category of herd size were found to be positive and significant. The results for medium category of herd size revealed that partial regression coefficients for expenditure on green fodder and miscellaneous expenditure for were found positive and significant. The results for large category of herd size revealed that the partial regression coefficient for expenditure on concentrate and miscellaneous expenditure were found positive and significant. In case of small category of herd size, it was observed that dry fodder, green fodder, labour and miscellaneous expenses were optimally utilized. In case of medium category it was observed that dry fodder, green fodder and miscellaneous expenses were optimally utilized. In case of large category of herd size, dry fodder, concentrate and miscellaneous expenditure were optimally utilized.   Key words: Concentrate, dry fodder, green fodder, labour, milk, mvp and resource  use efficiency.

The asymmetric influence of structural funds on regional growth in Greece

In this paper we aim to explore the conditioning effect of structural funds (SF) on regional growth in Greece for the period 1994–2006 by detecting if the ability of regions to convert any financial aid into welfare gains is related to certain region-specific characteristics. The analysis shows that, albeit that important financial aid has been channelled to the less-developed regions, the most advanced regions seem to have benefited more from it. Furthermore, we divide the SF into expenditure categories and conclude that the SF have a positive impact on growth only for those regions in which the regions’ endowments are related to the expenditure received. This interaction of the expenditure categories with the characteristics of the recipient region accentuates the role of the ‘identity’ of each region to the impact of SF on regional growth, thereby signifying valuable policy implications.

Revising Fiscal Policy and Growth in Saudi Arabia

This article empirically investigates how private investment and different categories of public expenditure (defense, education, health care, and housing) impact real non-oil GDP in Saudi Arabia. The econometric analysis couples unit root, stationarity, and cointegration analysis with vector error correction models. Impulse response functions are applied to examine the impacts of different shocks to the system. We find that public expenditures on health care and defense have decreased real non-oil GDP while public expenditure on education and housing have very little impact. Interestingly, public expenditures on health crowds-out private investment.

Trends in health care expenditure in U.S. adults with diabetes: 2002-2011.

OBJECTIVEDirect medical cost of diabetes in the U.S. has been estimated to be 2.3 times higher relative to individuals without diabetes. This study examines trends in health care expenditures by expenditure category in U.S. adults with diabetes between 2002 and 2011.RESEARCH DESIGN AND METHODSWe analyzed 10 years of data representing a weighted population of 189,013,514 U.S. adults aged ≥18 years from the Medical Expenditure Panel Survey. We used a novel two-part model to estimate adjusted mean and incremental medical expenditures by diabetes status, while adjusting for demographics, comorbidities, and time.RESULTSRelative to individuals without diabetes ($5,058 [95% CI 4,949–5,166]), individuals with diabetes ($12,180 [11,775–12,586]) had more than double the unadjusted mean direct expenditures over the 10-year period. After adjustment for confounders, individuals with diabetes had $2,558 (2,266–2,849) significantly higher direct incremental expenditures compared with those without diabetes. For individuals with diabetes, inpatient expenditures rose initially from $4,014 in 2002/2003 to $4,183 in 2004/2005 and then decreased continuously to $3,443 in 2010/2011, while rising steadily for individuals without diabetes. The estimated unadjusted total direct expenditures for individuals with diabetes were $218.6 billion/year and adjusted total incremental expenditures were approximately $46 billion/year.CONCLUSIONSOur findings show that compared with individuals without diabetes, individuals with diabetes had significantly higher health expenditures from 2002 to 2011 and the bulk of the expenditures came from hospital inpatient and prescription expenditures.

Welfare Analysis of Tax and Expenditure Reform

The motivation of the present paper originates from the current debt crisis of so many developed countries and analyzes, within a simplified model with a single representative consumer, the welfare effect of a combined reduction in indirect taxes and public expenditure. As already demonstrated by a pioneering work by Guesnerie (Econometrica 47:393–421, 1977) and subsequent literature, the bulk of information needed to be sure to get a welfare gain from this reform is heavy; under this respect a feature of the paper, to which less attention was paid, is a more detailed description on the side of public expenditure where multiple expenditure categories are allowed: this feature can be exploited to properly tailor expenditure and tax cuts. The main policy prescription arising from the paper is to concentrate expenditure cuts on categories with close private substitutes and a low marginal willingness to pay for them, and tax decreases on private goods with larger own price effects, weak relations with other private goods and complementary to labour. An important implication is that marginal willingness to pay could be the rationale for a new, or parallel, classification of public expenditure categories carrying incentives toward quality and efficiency.

The retirement consumption puzzle revisited: Evidence from the mandatory retirement policy in China

Using data from China's Urban Household Survey and exploiting China's mandatory retirement policy, we use the regression discontinuity approach to estimate the impact of retirement on household expenditures. Retirement reduces total non-durable expenditures by 19%. Among the categories of non-durable expenditures, retirement reduces work-related expenditures and expenditures on food consumed at home but has an insignificant effect on expenditures on entertainment. After excluding these three components, retirement does not have an effect on the remaining non-durable expenditures. It suggests that the retirement consumption puzzle might not be a puzzle if an extended life-cycle model with home production is considered.

Convergence in Public Expenditure Across a Sample of Emerging Countries: Evidence from Club Convergence

The goal of this article is to investigate convergence in public expenditure for a panel of nineteen emerging countries spanning the period 1990–2012. The study applies the methodology of the club convergence methodology to various categories of public expenditure to assess the presence of convergence clubs. I consider eleven alternative categories of public expenditure. The results do not support the hypothesis that all emerging countries converge to a single equilibrium state in public expenditure. Countries demonstrate a high degree of convergence in the sense that in the majority of the cases, these expenditures form only two or three convergence clubs.

The Retirement Consumption Puzzle in China

Using data from China's Urban Household Survey and exploiting China's mandatory retirement policy, we use the regression discontinuity approach to estimate the impact of retirement on household expenditures. Retirement reduces total non-durable expenditures by 20 percent. Among the categories of non-durable expenditures, retirement reduces work-related expenditures and expenditures on food consumed at home but has an insignificant effect on entertainment expenditures. After excluding these three components, retirement does not have an effect on the remaining non-durable expenditures. It suggests that the retirement consumption puzzle might not be a puzzle if a life-cycle model with home production is considered.

Gerry van Klinken and Ward Berenschot, eds. 『In Search of Middle Indonesia: Middle Classes in Provincial Towns』 Leiden: KITLV Press; Boston: Brill, 2014, xvi+242p.

In Search of Middle Indonesia: Middle Classes in Provincial TownsIn 2012, Indonesian Daily Kompas conducted a survey aiming to calculate actual number and define characteristics of what it called the of country's population. Involving 2,550 people above 17 years of age who lived in cities of Jakarta, Bandung, Yogyakarta, Surabaya, Makassar, and Medan, survey employed World Bank criteria of education level, occupation, and purchasing power parity (PPP) to determine categories of respondents. The survey result shows that 1% of respondents belonged to upper class, 3.6% to upper class, 50.2% to class, 39.6% to lower class, and 5.6% to lower class. In World Bank criteria this means that surveyed cohort groups, successively, earned and lived on than US$20 per day, between US$10 and 20, between US$4 and 10, between US$2 and 4, and less than US$2. This result echoes World Bank's own survey earlier that year as quoted by Daily Kompas, in which 56.5% of entire Indonesian population of 237 million in 2012-thus forming an actual number of 134 million people-is seen as belonging to category. Kompas and World Bank surveys represent analyses of socio-economic diversification of Indonesian population over past five years, which generally depicted a growing class. Whereas criteria used for grouping of surveyed respondents perform an established standard of income and expenditure method typical of economists, they do not satisfy other scholars who work on social, anthropological, and political aspects of demographic population. This edited volume, In Search of Middle Indonesia, is an attempt to break these established criteria and definition of middle and to offer an alternative to studying this paradigmatic term and phenomenon.In Search of Middle Indonesia explores expanding in Indonesia not by measuring people's consumption but by raising more relational, political (p. 2). Its basic premise is that class is not essentially a question of income or expenditure categories; it is a political concept, intended to explain why differences remain between behavior of rich and poor people over matters of common goods (p. 2). The authors in this book agree on statement that the possession of consumer durables says nothing about new political commitments and that simply reducing income threshold to poverty limit and calling everyone above that 'middle class' begs many analytical questions about political action (p. 3). While it does not abandon income and expenditure methodology, this book employs an ethnological approach to find answers to its prime question Why is Middle Indonesia so influential, locally and in Indonesia as a whole, though it is neither particularly rich nor particularly central in geographic terms? (p. 8). This book thus examines middle in terms of agencies and their characteristics of behaviors and seeks to clarify motives that prompt such behaviors by exploring ethnological rather than statistic data.In Search of Middle Indonesia is organized around three theoretical concepts, namely class, State, and everyday culture, each of which consists of three individual studies. Three of chapters concerning Kupang, East Nusa Tenggara emphasize previous studies some of authors have done on this provincial (see authors' biographies pp. vii-ix). Other studies focus on what authors consider middle towns, mostly provincial capitals. It has to be noted that selection of geographical locality of these studies reflects authors' shared consciousness of two points: importance of a non-Java centric approach and centrality of non-metropolitan urban lives in making of Indonesia's class.In first part of book, about class, Ben White overviews concept of Middle Indonesia based on Clifford Geertz's intermediate town (1963) and Robert and Helen Lynd's Middletown (1929; 1937). …

The Effects of Revenue Changes on NCAA Athletic Departments’ Expenditures

This study uses a panel of National Collegiate Athletic Association (NCAA) Division I athletic department revenue and expenditure data from 225 public colleges and universities to empirically investigate the behavior of athletic departments over the period 2006-2011. Three empirical relationships were explored: (a) how changes in total revenue affect disaggregated expenditure categories, (b) how disaggregated revenue streams influence total expenditures, and (c) whether changes in revenue categories change the size of the athletic department’s subsidy. The results show that additional athletic revenue increases expenditures for coaches 7.5 times more than direct expenditures for student-athletes, a ratio that increases for schools in power conferences. For every US$1 increase in ticket sale revenue, total expenditures can rise by US$0.83 and reduce a school’s athletic subsidy by US$0.19.

The financial burden of out of pocket prescription drug expenses in Canada.

Pharmaceutical expenditures account for approximately 15.9% of total health expenditures in Canada. Unlike hospital and physician services, in which costs are universally covered, most pharmacological therapy does not fall under the umbrella of 'medically necessary' services set out by the Canada Health Act, and therefore is funded through a mix of public and private plans. Little is known about the actual financial burden experienced by Canadians from out-of-pocket drug expenditures (OOPDE). This paper examines the burden of OOPDE in Canada. 1.1% of Canadian households exceed our catastrophic threshold (9%) of the drug budget share. Additionally, 2.6 and 8.2% of households exceed lower thresholds of 6 and 3% respectively. We find an inverse relationship between household income and the burden of OPPDE. Low-income households have the highest likelihood of being in the 'catastrophic' drug expenditure category. This finding suggests that a vulnerable population of 'working poor' are likely to be experiencing disproportionate financial burden because they are not eligible for public assistance programs. Seniors experience the highest burden of OPPDE when compared to other age groups. We also find that there is significant interprovincial variation in the burden of OOPDE, which partly reflects different provincial government drug coverage policies.

The Effects of Revenue Changes on NCAA Athletic Departments' Expenditures

This study uses a panel of NCAA Division I athletic department revenue and expenditure data from 225 public colleges and universities to empirically investigate the behavior of athletic departments over the period 2006-2011. Three empirical relationships were explored: (1) how changes in total revenue affect disaggregated expenditure categories, (2) how disaggregated revenue streams influence total expenditures, and (3) whether changes in revenue categories change the size of the athletic department's subsidy. The results show that additional athletic revenue increases expenditures for coaches 7.5 times more than direct expenditures for student athletes, a ratio that increases for schools in power conferences. For every one dollar increase in ticket sale revenue, total expenditures can rise by $0.83 and reduce a school’s athletic subsidy by $0.19.

A Determinant Of Healthy Ageing Women Education In Saudi Arabia

An increase in the number of elderly people has major implications for society, affecting such areas as health and social services and public spending. The economic effects of an ageing population are considerable. Older people have more savings than younger people, but spend less on consumer goods. The rise in ageing populations will also increase some categories of expenditure, like health care, whose cost is likely to increase dramatically as the population ages. Saudi Arabians, while relatively enthusiastic about saving in general, see retirement as a less important incentive to save and have reduced retirement savings as a result of the current economic downturn. At the same time, life expectancy will be higher and birth rate will decline because of the increase of education levels. People's concepts of birth and health care will be improved under the function of education. Education is the single most important indicator of the socioeconomic status of an individual, which affects almost all aspects of human life, including demographic health behavior. Change of the increase of population ageing that is caused by the change of the relative number of independent variables, such as education, is more of a concern.

European Union budget politics: Explaining stability and change in spending allocations

The marginal involvement of the European Union (EU) in redistributive policies and its limited fiscal resources have led to a notable lack of attention by EU scholars towards the EU budget and its dynamics. Yet the nature of the budgetary data and their high usability for statistical analysis make them an excellent tool for studying and measuring policy change in the EU. In this article, I analyse an original dataset containing yearly data for the main categories of expenditure and how they have changed over the last three decades (1979–2013). Using time-series analysis, I find that the ability to form winning coalitions in the Council, the ideological positioning of the co-legislators and the inclusion of the cohesion countries have played a significant role in driving budget change.

Modeling the Price of Crude Oil and Motor Fuel: A Five-Year Revision

We present a five-year revision of an empirical study started in 2007. Seven years ago, we found two three distinct periods characterized by sustainable linear trends in the difference between the headline consumer price index (CPI) and the core CPI in the USA. Then we revealed similar behavior in the differences between the CPI and indices of various consumer expenditure categories. We estimated the duration of these trends which varies in a wide range from 5 years to more than 20 years. The transition periods to new trends span shorter intervals of 2 to 5 years. The transition is characterized by a higher level of volatility in the studied CPI differences. In April 2009, we introduced a simple quantitative model representing the evolution of motor fuel price (a subcategory of the consumer price index of transportation) relative to the core CPI as a linear function of time. Under our framework, all price deviations from this linear trend are transient and the price must return to the sustainable trend. The model predicted that oil price would fall to $30-$60 per barrel in 2016, which is very close to the current price. The behavior of actual oil and motor fuel price since 2010 has shown that this prediction is accurate in both amplitude and trajectory shape – a good support for the credibility of our empirical mode. We conclude that the concept of price decomposition into a short-term (oscillating) and long-term (linear trend) components deserves a deeper theoretical consideration of the driving forces behind linear time trends and can be used as a workhorse for a wide spectrum of commodity investors. According to the model, the price of crude oil will be falling to the level of $30 per barrel during the next 6 years and motor fuel will follow up the oil price. Moreover, the periodicity of the related normalized difference indicates that this low-price level may extend into the second half of the 2020s. The secular fall in energy prices may induce a lengthy period of very low inflation.

How Do Migrant Remittances Affect Household Consumption Patterns?

This study analyzes differential consumption patterns of Pakistani migrant households resulting from foreign and domestic remittances. Using the Working-Leser model and a number of matching techniques, we analyze a large representative household survey carried out in 2010-2011 to compare various expenditure categories of recipient and non-recipient households across different income brackets. Findings show that foreign remittances lead to significant consumption changes. Contrary to the widely-held view, remittances do not raise the budget share on consumer goods and recreation, while the allocation on education increases substantially. Households receiving domestic remittances also show a strong focus on human capital with significantly higher shares of health and education. Recipients of international transfers living below one dollar a day spend proportionally more on food compared with their non-recipient counterparts, whereas their education and health budget shares are not dissimilar. We find that migrant households perceive remittances as a mainly transient, not fully fungible source of income.

A Review of Measurement Error Assessment in a U.S. Household Consumer Expenditure Survey

This paper examines what is known about error in the U.S. Consumer Expenditure Survey (CE). It reviews likely sources of error in consumer expenditure surveys and describes the various approaches that have been used to evaluate estimates from the CE in the United States and from similar surveys around the world. In the United States, many efforts to assess the quality of the CE have compared CE estimates to estimates from other surveys or from the National Income and Product Accounts (NIPA). In addition, other studies have used data internal to the CE in an attempt to assess the level of error. We review studies that take each of these approaches and assess their strengths and weaknesses. Our review shows that, as with other national and international surveys on household spending, the direction and magnitude of measurement errors in the CE are not well understood. The general impression that the CE expenditure estimates are dominated by underreporting is based largely on comparisons of the CE with NIPA estimates. However, other results suggest that the magnitude and direction of errors in the CE depend on the expenditure category examined, characteristics of the respondent and the survey protocol, and the method used to assess these errors. New research clearly is needed to understand the sources of error in surveys collecting consumer expenditure data.

Does Microfinance Elevate Poverty? Does Family Size Matter in the Provision of Microcredit? Evidence from a Randomised Evaluation

This paper looks at randomised assessment of microcredit intervention through Spandana in Hyderabad, India. It looks at households with six or more than six members as a restricting conditioning to see whether provision of microcredit affects them differently. This paper finds significant differences in the way which smaller and bigger families allocate their additional resource received in the form of microcredit intervention. As stated above, bigger households spend more on durable goods as soon as they received a loan whereas smaller households do not emphasis on increasing household stocks. These results are revealing on how different households prioritise their expenditure categories and thus may serve as a guide to microcredit institutions on how to provide tailored credit packages. Likewise, intuitively bigger households had higher borrowing levels compared to smaller households . Furthermore, this paper concludes that smaller households increase their borrowing from banks and informal sources as well. The reasons behind this contrast maybe due to unconsidered factors in this study such as existing family businesses, household preferences or loan provider criteria.