Allocation Formula Research Articles

Five years into the Israeli National Diabetes Program - are we on the right track?

Diabetes mellitus poses major public health and economic challenges which necessitate national-level intervention. The ultimate goal of the Israel National Diabetes Program is to ensure that all people with diabetes, or at high risk of developing diabetes, will live well and have access to high-quality services that meet their individual needs. The integrated National Diabetes Program in Israel was established in 2014. Prevailing needs were identified and working groups assigned to delineate deficiencies and propose mode of action. Program leaders summarized and prioritized the needs, and identified main targets of action for the preliminary years. The program was achieved by a combined approach: top-bottom, having the Director General of the Ministry of Health (MoH) personally involved, and bottom-up, by routine meetings with representatives of the health organizations, clinical experts, patient representatives and other stakeholders. Main achievements during the first five years of the program included setting up a novel funding mechanism for diabetes prevention, substantiating the field of diabetes education in Israel, designing the infrastructure of diabetic foot care in Israel, updating the national health-budget allocation formula with incentives to improve provision of services, and promoting a mandatory system for judgemental labelling of food products. The program is in progress with ongoing monitoring, evaluation and improvement with particular emphasis on translational learning. Although there is much to be done, diabetes care in Israel has taken an enormous step forward in the past five years.

State and local government employment in the COVID-19 crisis

Local governments are facing large losses in revenues and increased expenditures because of the COVID-19 crisis. We document a causal relationship between fiscal pressures induced by COVID-19 and the layoffs of state and local government workers. States that depend more on sales tax as a source of revenue laid off significantly more workers than other states. The CARES Act’s provision of $150 billion in aid to state and local governments reduced the fiscal pressures they faced. Exploiting a kink in the formula for allocation of funding across states, we estimate that without this funding state and local governments would have laid off an additional 401,000 workers in April 2020, 40 percent more than realized. State rainy day fund balances limit the sensitivity of employment to these revenue shocks, revealing that balanced budget requirements for state and local governments increase the procyclicality of public service provision.

Local Government Finances and Balanced Budgets in the COVID-19 Crisis

Local governments are facing large losses in revenues and increased expenditures because of the COVID-19 crisis. We document a causal relationship between fiscal pressures induced by COVID-19 and the layoffs of state and local government workers. States that depend more on sales tax as a source of revenue laid off significantly more workers than other states. The CARES Act's provision of \$150 billion in aid to state and local governments reduced the fiscal pressures they faced. Exploiting a kink in the formula for allocation of funding across states, we estimate a state and local government employment multiplier for federal aid---each dollar of federal aid was used by states to support 31 cents of payrolls. State rainy day fund balances limit the sensitivity of employment to both revenue shocks, revealing that balanced budget requirements for state and local governments increase the procyclicality of public service provision.

Levels, trends and determinants of technical efficiency of general hospitals in Uganda: data envelopment analysis and Tobit regression analysis

BackgroundGeneral hospitals provide a wide range of primary and secondary healthcare services. They accounted for 38% of government funding to health facilities, 8.8% of outpatient department visits and 28% of admissions in Uganda in the financial year 2016/17. We assessed the levels, trends and determinants of technical efficiency of general hospitals in Uganda from 2012/13 to 2016/17.MethodsWe undertook input-oriented data envelopment analysis to estimate technical efficiency of 78 general hospitals using data abstracted from the Annual Health Sector Performance Reports for 2012/13, 2014/15 and 2016/17. Trends in technical efficiency was analysed using Excel while determinants of technical efficiency were analysed using Tobit Regression Model in STATA 15.1.ResultsThe average constant returns to scale, variable returns to scale and scale efficiency of general hospitals for 2016/17 were 49% (95% CI, 44–54%), 69% (95% CI, 65–74%) and 70% (95% CI, 65–75%) respectively. There was no statistically significant difference in the efficiency scores of public and private hospitals. Technical efficiency generally increased from 2012/13 to 2014/15, and dropped by 2016/17. Some hospitals were persistently efficient while others were inefficient over this period. Hospital size, geographical location, training status and average length of stay were statistically significant determinants of efficiency at 5% level of significance.ConclusionThe 69% average variable returns to scale technical efficiency indicates that the hospitals could generate the same volume of outputs using 31% (3439) less staff and 31% (3539) less beds. Benchmarking performance of the efficient hospitals would help to guide performance improvement in the inefficient ones. There is need to incorporate hospital size, geographical location, training status and average length of stay in the resource allocation formula and adopt annual hospital efficiency assessments.

“If we had a little more flexibility.” perceptions of programmatic challenges and opportunities implementing government-funded low-income energy efficiency programs

Since 1976, the U.S. Department of Energy's Weatherization Assistance Program (WAP) has provided state block grants for no-to low-cost energy efficiency retrofits for more than 7 million low-income households. Yet, more than 35 million households meet income-qualifications for the program. While numerous program evaluations demonstrate the energy- and non-energy-related benefits of WAP, some argue low uptake, and a low rate of return on retrofit costs to energy savings. To further our understanding of government-funded low-income energy efficiency program implementation, we examined local agency-level perceptions of challenges and opportunities. Findings from semi-structured interviews with program managers, representing one-third of Michigan's WAP funding and retrofit production, suggest three funding-related challenges: funding instability; funding allocation formula; and limited advertising and marketing funding, and two regulatory-related challenges: cumbersome paperwork and restrictive guidelines. Program managers also identified three workaround opportunities: collaboration with utilities and other organizations; intra-agency innovation and integration; and strategic productivity and per unit spending. Lastly, one recommendation for further exploration would be testing the efficacy of granting local agencies greater flexibility to work around funding and regulatory challenges to increase the number of households weatherized, reduce long waitlists and deferral rates, and use staff time more efficiently.

End-of-life modelling of buildings to support more informed decisions towards achieving circular economy targets

PurposeLife cycle assessment (LCA) is an internationally accepted method to assess the environmental impacts of buildings. A major methodological challenge remains the modelling of the end-of-life stage of buildings and allocation of benefits and burdens between systems. Various approaches are hence applied in practice to date. This paper compares the two methods widely renowned in Europe—the EC product environmental footprint (PEF) method and the CEN standards: EN 15804+A1 and EN15978—and offers insights about their fitness for achieving circularity goals.MethodsThe EC PEF method and the CEN EN 15804/EN 15978 standards were methodologically analysed with a focus on the end-of-life modelling and allocation approach and were applied to a building case study. The EN 15804+A1 standard explains the guidelines but does not offer a modelling formula. Accordingly, this paper proposes a formula for the CEN standards using identical parameters as in the end-of-life circular footprint formula (CFF) of the EC PEF Guidance v6.3 to increase consistency among LCA studies. The calculation formulas were then applied to a newly constructed office building. A comparative analysis of both the implementation and results are described, and recommendations are formulated.ResultsIn the absence of databases compatible with the two LCA methods and comprising all building products, the Ecoinvent datasets had to be remodelled to enable a comparative modular assessment. This proved to be a laborious process. The EC PEF method and CEN standards showed similar impacts and hotspots for the case study building. The module D in the CEN standards includes a significant share of positive impacts, but due to collective accounting, it does not clearly communicate these benefits. The summation of burdens and benefits in the EC PEF method reduces its transparency, while the allocation and quality factors enable this method to better capture the market realities and drive circular economy goals.ConclusionsThe construction sector and the LCI database developers are encouraged to create the missing LCA databases compatible with the modular and end-of-life allocation modelling requirements of both methods. More prescriptive and meticulous guidelines, with further harmonization between the EC PEF method and the CEN standards and their end-of-life allocation formula, would largely increase comparability and reliability of LCA studies and communications. To improve transparency, it is recommended to report the module D impacts per life cycle stage as per the CEN standards and the burdens and benefits separately for each life cycle stage as per the EC PEF method.

Balancing Nigerian Federal System: The Politics and Economics of a Federation.

This paper discusses the efforts that have been made since Nigeria became independent in 1960 to balance her federal system. These efforts include balancing the territorial structure, creation of states, the power structure between the central and state governments, balancing inform of revenue allocation formulae and balancing by the adoption of federal character principle. Thus, to what extent have these efforts succeeded in balancing Nigerian federal system? Today, however, the efforts continue as Nigerian federal system is being confronted by the clamour for restructuring. The paper concludes by recommending a review of the current federal system which is being practiced more like a unitary system.

RESTRUCTURING AND ECONOMIC DEVELOPMENT IN NIGERIA

The research is designed to assess the effect of restructuring and economic development in Nigeria. A review of the relevant literature and previous studies support the adoption of Marxist political economy theory as its theoretical framework while, survey method was adopted as its methodology. Oral interviews and questionnaire were employed in collecting primary data where as the analysis of data was executed using percentages. Among the findings, it was revealed by this study that the need for restructuring is for effective decentralization of political power and effective resource control and restructuring can also bring about proper allocation and equitable distribution of resources which will enhance economic development. It was therefore recommended that the Nigerian government should show a high level of readiness towards restructuring the economy by putting in place all the necessary structures needed for efficient distribution and utilization of resources also, the National Assembly should review the allocation formula to empower the second and third tiers of government in revenue generation as well as the citizenry should be sensitized to demand for zoning of political office to be included in ongoing constitutional review process.

Mapping variability in allocation of Long-Term Care funds across payer agencies in OECD countries

Abstract Background Long-term care (LTC) is organized in a fragmented manner. Payer agencies (PA) receive LTC funds from the agency collecting funds, and commission services. Yet, distributional equity (DE) across PAs, a precondition to geographical equity of access to LTC, has received limited attention. We conceptualize that LTC systems promote DE when they are designed to set eligibility criteria nationally (vs. locally); and to distribute funds among PAs based on needs-formula (vs. past-budgets or government decisions). The objectives of this cross-country study is to highlight to what extent different LTC systems are designed to promote DE across PAs, and the parameters used in allocation formulae. Methods Qualitative data were collected through a questionnaire filled by experts from 17 OECD countries. Results 11 out of 25 LTC systems analyzed, fully meet DE as we defined. 5 systems which give high autonomy to PAs have designs with low levels of DE; while nine systems partially promote DE. Allocation formulae vary in their complexity as some systems use simple demographic parameters while others apply socio-economic status, disability, and LTC cost variations. Conclusions A minority of LTC systems fully meet DE, which is only one of the criteria in allocation of LTC resources. Some systems prefer local priority-setting and governance over DE. Countries that value DE should harmonize the eligibility criteria at the national level and allocate funds according to needs across regions. Key messages A minority of LTC systems in OECD countries fully meet distributional equity in allocation of resources across payer agencies. Countries that value distributional equity should harmonize the eligibility criteria to LTC at the national level and allocate funds according to needs across regions.

Allocating resources to support universal health coverage: development of a geographical funding formula in Malawi

BackgroundUniversal health coverage (UHC) requires that local health sector institutions—such as local authorities—are properly funded to fulfil their service delivery commitments. In this study, we examine how formula funding can...

Fiscal disparities in Indonesia in the decentralization era: Does general allocation fund equalize fiscal revenues?

AbstractThis study analyses the level and trend of fiscal disparity among Indonesian districts. It also explores the determinants of fiscal disparity using two inequality decomposition methods: decomposition of the Gini coefficient and the coefficient of variation by revenue sources and decomposition of the Theil index by regions. Disparity in shared revenue has been large due to the very uneven spatial distributions of natural resources and tax bases. It is unambiguously an inequality‐increasing fiscal transfer in Indonesia. A general allocation grant has served to equalize fiscal revenue, but overall fiscal disparity is still high. To reduce the disparity, it may be necessary to modify the general allocation formula since it appears to be defective. This study proposes a new allocation formula. Though the reduction in fiscal disparity is not substantial in the short run, the new formula would provide an incentive for resource‐poorer district governments to raise their own source revenue. This could create a virtuous cycle if the additional own source revenue is used for local development, particularly education and infrastructure. Another option to reduce fiscal disparity would be the further expansion of special allocation grant. If the government allocates the special allocation fund effectively across districts in Indonesia, it could make a special allocation grant an inequality‐decreasing fiscal transfer.

Allocating resources to support universal health coverage: policy processes and implementation in Malawi

Optimising the use of limited health resources in low-income and middle-income countries towards the maximisation of health outcomes requires efficient distribution of resources across health services and geographical areas. While...

A validation of coauthorship credit models with empirical data from the contributions of PhD candidates

A perennial problem in bibliometrics is the appropriate distribution of authorship credit for coauthored publications. Several credit allocation methods and formulas have been introduced, but there has been little empirical validation as to which method best reflects the typical contributions of coauthors. This paper presents a validation of credit allocation methods using a new data set of author-provided percentage contribution figures obtained from the coauthored publications in cumulative PhD theses by authors from three countries that contain contribution statements. The comparison of allocation schemes shows that harmonic counting performs best and arithmetic and geometric counting also perform well, while fractional counting and first author counting perform relatively poorly.

Capital allocation and RORAC optimization under solvency 2 standard formula

Solvency II Directive 2009/138/EC requires an insurance and reinsurance undertakings assessment of a Solvency Capital Requirement by means of the so-called “Standard Formula” or by means of partial or full internal models. Focusing on the first approach, the bottom-up aggregation formula proposed by the regulator allows for a capital reduction due to the diversification effect, according to the typical subadditivity property of risk measures. However, once the overall capital has been assessed no specific allocation formula is provided or required in order to evaluate the contribution of each risk source on the overall Solvency Capital Requirement. The aim of this paper is twofold. First, we provide a closed formula for capital allocation fully compliant with the Solvency II Capital Requirement assessed by means of the Standard Formula. The solution enables a top-down approach to assess the allocated Solvency Capital Requirement among the risks considered in the Solvency II multilevel aggregation scheme; we demonstrate that the allocation formula adopted is consistent with the Euler allocation principle. Second, a solution is found as a result of an optimum capital allocation problem based on a Return On Risk Adjusted Capital measure; we establish the equivalence between the Return On Risk Adjusted Capital optimization, when the risk adjusted capital is calculated according to the Standard Formula, and the Markowitz mean-variance optimization.

Distributing Local Resources for Public Health Preparedness Grants: A Data-Driven Approach.

To simulate allocations of Public Health Emergency Preparedness funds to counties using alternative metrics of need, minimum allocation amounts, and the proportion earmarked for discretionary considerations. We developed a county-level community resilience index of 57 New York State counties using publicly available indicators, which we incorporated into an interactive spreadsheet of 8 hypothetical allocation formulas with different combinations of population size, the index and its 5 domains, and population density. Simulations were compared with the 2013-2014 fiscal year grant allocation. New York allocated $6.27 million to counties outside New York City, with a median allocation of $78 038, ranging from $50 825 to $556 789. These allocations would vary under different strategies, with the largest changes among sparsely populated counties that currently receive a minimum allocation of $50 825. Allocations were sensitive to changes in minimum allocation, amount earmarked for discretionary allocation, and need indicator. Population-based approaches are commonly used but ignore important dimensions of need. It is feasible to include robust local community resilience measures in formulas, and interactive spreadsheet models can help stakeholders evaluate the consequences of alternative funding strategies.

E-Commerce Taxation in Russia: Problems and Approaches

The purpose of this article is to describe a mechanism for taxing e-commerce profits of multinational corporations (MNCs). Our research hypothesis is that the new economic reality, where digital transactions are on the rise, requires new mechanisms for taxation of MNCs’ profits. Our research methodology relies on a systemic approach aimed at embracing the complexity and dynamics of the above phenomena. We analyze the feasibility and possible outcomes of the introduction of the indirect digital services tax in Russia, in particular its potential impact on the tax burden distribution and economic growth. Special attention in the article is given to the definition and criteria of virtual permanent establishment. We propose a definition that emphasizes the non-physical nature of permanent establishments in e-commerce and does not include any subjective criteria. Since the Russian tax system is not sufficiently synchronized with the global digital trends, especially regarding taxation of e-commerce profits of tech giants, which means that the introduction of a digital services tax in Russia may be premature due to its possible negative influence on the tax burden redistribution, competition, business profitability, employment, personal income and innovation. Russia will be able to participate in the process of allocation of MNCs’ profits if the mechanism of direct taxation is developed and the institution of virtual permanent establishment is introduced into the national tax legislation. These measures will enable the Russian state to realize its taxing rights in relation to MNC’s profits and benefit from the international trends in profit-allocation. Our critical analysis of the OECD’s unified approach has shown its weaknesses and led us to the conclusion that a simple and more transparent taxation mechanism is necessary based on the formulary apportionment of MNCs’ total revenues rather than residual profits among the relevant jurisdictions. In our view, Russia should move ahead with the unilateral measures for taxation of MNCs in accordance with the mechanism described above. Unlike the majority of research, we propose to use only objective value indicators, which cannot be distorted by subjective interpretations, and exclude the risk degree indicator from the set of allocation keys. It also makes sense to use a formula for allocation of profit among the countries rather than corporate structures, as it will enable tax authorities to take into account the impact of federal and regional tax preferences to investors. For citation Polezharova L.V., Krasnobaeva A.M. E-Commerce Taxation in Russia: Problems and Approaches. Journal of Tax Reform. 2020;6(2):104–123. DOI: 10.15826/jtr.2020.6.2.077. Article info Received June 3, 2020; Revised July 9, 2020; Accepted August 8, 2020

The Effects of Central Government Transfers on Local Revenue Collection by Urban Local Governments in Uganda: A Case of Selected Municipal Councils

Government of Uganda is undertaking reforms to improve on the funding levels and modalities of local governments but is faced with a limited budget to fund both the central government and decentralized functions. Less is known about the effect of central government transfers to local revenue collection especially in the context of decentralization in Uganda. We assessed the effects of central government transfers on local revenue generation by municipalities in Uganda by analyzing the trends of central government transfers and locally generated revenues by the municipal councils and assessing the effects of central government transfers on own local revenue generation. Our study focused on municipalities that have been in existence since introduction of decentralization policy and some of these have recently been upgraded into cities. Time series data covering the selected municipalities were obtained from the Local Government Finance Commission. The dataset comprised of locally generated revenue and central government transfers for 13 old municipal councils. The data was in Excel and it had to be exported to E-Views statistical software for further analysis using the fixed effects regression model. Our findings indicate that over the period 2002 to 2017, both central government grants and local revenue generation grew exponentially. We find that increased central government grants contributed to a decline in locally generated revenue and this partly attributable to too much reliance of the local governments on central grants. The results showed that the lagged total central government grants had a significant negative effect on the locally generated revenue. Government should factor in the allocation formula for central government grants to the local revenue performance to serve as an incentive for the municipal councils to raise own local revenue.

PNS408 HOW IS THE ENGLISH NHS PRESCRIPTION DRUGS BUDGET SPENT

In Financial Year (FY) 2018/19, NHS England (NHSE) spent £7.9 billion on prescription drugs prescribed by GPs to their patients. This is 2.7% less than FY 2017/18. This study investigated drivers of this trend at regional and drug-class levels on a risk-adjusted basis and projected the results over a five year time period. Publicly available data was used. Prescription drug and population data published by the NHS were used to derive the per person per month costs. The prescription drug risk-adjustment factors were based on those used in the NHS funding allocation formula. Prescription drug cost and activity trends were analysed at a drug-class (BNF chapter) and regional level. Regions were defined by sustainability and transformation plan (STP) area. Risk-adjustment helped determine what cost we would ‘expect’ based on each STP’s risk profile compared to the English average. Costs were projected over a five-year period under various scenarios, using expected changes in population size and structure published by the NHS. The reduction in expenditure is driven by a combination of lower average costs (3.83% decrease) and lower levels of activity (0.92% decrease). These decreases in total cost are slightly offset by the 1.19% increase in the English population size. The research highlights particular BNF chapters and STP regions that are driving these trends as well as how STP regions’ experience compares to the English average on a risk-adjusted basis. The projection model shows that prescription drug costs can be expected to decrease by 3.6% p.a. over the next five years if historical trends persist. The insights provided by this research can help stakeholders with experience analysis and planning by identifying cost and activity drivers on a population risk-adjusted basis as well as having a view of how demand may develop over the projection period.

Generating and Allocating Internal Revenue for Public Secondary School Administration in Cross River State

The design adopted for this study was correlation. Population of the study consisted of all the 504 public secondary schools principals in 18 LGAs in Cross Rivers State. However, purposive sampling technique was use to select the 504 principals a sample for the study. There were two research questions and two hypotheses formulated for the study. Questionnaire was the instrument used for data collection with 20 items and titled “Generation and Allocation of Internal Revenue for School Administration Questionnaire” (GAIRSAQ). The GAIRSAQ was validated by the researchers’ supervisors as well as two experts from Measurement and Evaluation in the Department of Psychology, Guidance and Counseling. Split half statistic associated with Spearman Brown prophecy formula was used to estimate the reliability of the questionnaire with co-efficient of 0.86. Mean, standard deviation and rank order were used to answer the research questions while z-test was used to test the hypotheses at 0.05 level of significance. The findings of the study showed that rentage, community assistance, PTA contributions, fund raising campaigns were among the strategies for generating revenue in public secondary schools in Cross River State. The study also showed that revenue was majorly allocated based on the urgency of the need and that revenues generated were utilized for different administrative needs such as provision of facilities, maintenance and day-to-day running of the school. Therefore, it was recommended among others that principals should develop an equitable revenue allocation formula for effective administration of public secondary schools in Cross River State.

Optimal Design of Cluster- and Multisite-Randomized Studies Using Fallible Outcome Measures.

Evaluation studies frequently draw on fallible outcomes that contain significant measurement error. Ignoring outcome measurement error in the planning stages can undermine the sufficiency and efficiency of an otherwise well-designed study and can further constrain the evidence studies bring to bear on the effectiveness of programs. We develop simple formulas to adjust statistical power, minimum detectable effect (MDE), and optimal sample allocation formulas for two-level cluster- and multisite-randomized designs when the outcome is subject to measurement error. The resulting adjusted formulas suggest that outcome measurement error typically amplifies treatment effect uncertainty, reduces power, increases the MDE, and undermines the efficiency of conventional optimal sampling schemes. Therefore, achieving adequate power for a given effect size will typically demand increased sample sizes when considering fallible outcomes, while maintaining design efficiency will require increasing portions of a budget be applied toward sampling a larger number of individuals within clusters. We illustrate evaluation planning with the new formulas while comparing them to conventional formulas using hypothetical examples based on recent empirical studies. To encourage adoption of the new formulas, we implement them in the R package PowerUpR and in the PowerUp software.