Income Subsidy Research Articles

Analyzing the Effects of Economic Determinants on Urban and Rural Energy Poverty: Evidence from 36 African Countries

ABSTRACT This study aimed to examine energy poverty’s determinants in Africa across 36 countries spanning 2000 to 2020. Using fractional regression models, it analyzed how factors such as economic growth, unemployment rates, foreign direct investment, and demographic profiles influence urban and rural access to electricity. The findings highlight the positive impact of economic growth and a larger elderly population on electricity access. Conversely, higher unemployment rates consistently hinder access. Surprisingly, while foreign direct investment improves urban electricity access, it does not show the same effect in rural areas. These insights are vital for governments and stakeholders, guiding the development of energy policies. To alleviate energy poverty, especially in remote regions, policy interventions should focus on income subsidies and boosting employment opportunities.

Associations Between Annual Medicare Part D Low-Income Subsidy Loss and Prescription Drug Spending and Use

The Medicare Part D Low Income Subsidy (LIS) program provides millions of beneficiaries with drug plan premium and cost-sharing assistance. The extent to which LIS recipients experience subsidy losses with annual redetermination cycles and the resulting associations with prescription drug affordability and use are unknown. To examine how frequently annual LIS benefits are lost among Medicare Part D beneficiaries and how this is associated with prescription drug use and out-of-pocket costs. In this cohort study of Medicare Part D beneficiaries from 2007 to 2018, annual changes in LIS recipients among those automatically deemed eligible (eg, due to dual eligibility for Medicare and Medicaid) and nondeemed beneficiaries who must apply for LIS benefits were analyzed using Medicare enrollment and Part D event data. Subsidy losses were classified in 4 groups: temporary losses (<1 year); extended losses (≥1 year); subsidy reductions (change to partial LIS); and disenrollment from Medicare Part D after subsidy loss. Temporary losses could more likely represent subsidy losses among eligible beneficiaries. Multinomial logit models were used to examine associations between beneficiary characteristics and subsidy loss; linear regression models were used to compare changes in prescription drug cost and use in the months after subsidy losses vs before. Analyses were conducted between November 2022 and November 2023. Subsidy loss at the beginning of each year among subsidy recipients in December of the prior year. The main outcomes were out-of-pocket costs and prescription drug fills overall and for 4 classes: antidiabetes, antilipid, antidepressant, and antipsychotic drugs. In 2008, 731 070 full LIS beneficiaries (17%) were not deemed automatically eligible (39% were aged <65 years; 59% were female). Nearly all beneficiaries deemed automatically eligible (≥99%) retained the subsidy annually from 2007 to 2018, compared with 78% to 84% of nondeemed beneficiaries. Among nondeemed beneficiaries, disabled individuals younger than 65 years and racial and ethnic minority groups were more likely to have temporary subsidy losses vs none. Temporary losses were associated with an average 700% increase in out-of-pocket drug costs (+$52.72/mo [95% CI, 52.52-52.92]) and 15% reductions in prescription fills (-0.58 fills/mo [95% CI, -0.59 to -0.57]) overall. Similar changes were found for antidiabetes, antilipid, antidepressant, and antipsychotic prescription drug classes. Beneficiaries who retained their subsidy had few changes. The conclusions of this cohort study suggest that efforts to help eligible beneficiaries retain Medicare Part D subsidies could improve drug affordability, treatment adherence, and reduce disparities in medication access.

Urban unemployment, environmental preservation and trade policies in a small open economy with open access renewable resources

This study presents a two-sector dynamic analytical model that examines the impact of trade policies on urban poverty reduction and resource conservation, given that institutionally fixed high urban wages are assumed in the context of the Harris-Todaro model. Rural resource-good and urban manufacturing activities generate simultaneous environmental pressures that can detrimentally impact environmental preservation in a small, open economy. Moreover, this study assumes that the polluting manufacturing sector is the primary cause of environmental degradation and represents a relatively more industrialized developing country. The study finds that raising the import tax on rural resource goods can reduce urban unemployment but worsen environmental quality under dynamic resource conditions. Given institutional distortions, the most efficient policy is to implement a rural income subsidy combined with an urban wage subsidy at a lower rate; alternatively, if the income inequality between regions is sufficiently high, an income tax on urban manufactured goods could be considered. Finally, when considering the endogenous resolution of institutional distortions, an increase in the import tax on rural resource goods can resolve rural institutional distortions, shifting from poorly defined resource management to a perfect private management system. In contrast, implementing an export tariff policy on urban manufactured goods reduces the incentive for rural institutional reform while addressing urban institutional failure.

THE IMPACT OF CLOSING MEDICARE PART D COVERAGE GAP ON MENTAL HEALTH OF OLDER ADULTS

Abstract The ACA mandated the gradual elimination of the Medicare prescription drug coverage gap (also called the “Doughnut Hole”) beginning in 2011. This policy change can impact mental health through mechanisms such as reduction in out-of-pocket (OOP) expenses and increased access to prescription medication. However, no previous study has examined its impact on mental health outcomes of older adults on Medicare. Employing data from the Medical Expenditure Panel Survey (from 2006 to 2016), compare the mental health of Medicare beneficiaries (66-70 years; N=7,664) with that of non-Medicare beneficiaries (60-64 years; N=8,079) before versus after policy implementation. We find that the 2011 phasing out of Medicare drug coverage gap was associated with 0.86-point (p&amp;lt; 0.05) improvement in the Mental Component score of the Short-Form 12 Health Survey among beneficiaries. Our analysis was robust to using alternate measures of mental health outcomes (Kessler Index and PHQ-2) as well as to an alternate construction of treatment and control groups (comparing individuals aged 60-70 years on Medicare and private insurance). We find no detectable differences in the mental health of Medicare beneficiaries who already receive subsidies for costs associated with the coverage gap through the Low Income Subsidy (LIS) program. Further, we find that elimination of the doughnut hole reduced OOP expenses by $32.65 among Medicare beneficiaries in our sample. Overall, our results for mental health and OOP expenses are mainly attributable to women. This evidence highlights indirect effects of drug coverage gap elimination on mental health outcomes among Medicare beneficiaries.

Quality of treatment selection for Medicare beneficiaries with cancer.

140 Background: Because NCCN guidelines recommend multiple chemotherapy regimens, guideline-concordant treatments often differ substantially in clinical benefit. Variation in treatment quality – whether patients receive the most highly-recommended treatment option for their cancer – has not been assessed broadly across cancer types. Methods: Population-based cohort study using linked SEER-Medicare and NCCN Evidence Blocks (EB) data, 2015-2017. We reviewed historical NCCN Guidelines and ranked recommended treatments according to their EB scores. We then identified indications for initial systemic therapy in which 1) ≥1 treatment dominated (higher Efficacy AND Safety scores); 2) indication was identifiable in SEER-Medicare (eg, not biomarker-defined); 3) NCCN EB and ASCO Value Framework were in agreement regarding the optimal treatment, and 4) sufficient SEER-Medicare cases from initial EB publication date through 2017. For each indication, we identified the corresponding SEER-Medicare cohort. The primary outcome was initial systemic therapy received, categorized as Optimal (highest EB scores), Lower But Non-Inferior (LNI; lower overall EB scores but Efficacy or Safety = Optimal therapy), Inferior/Non-Recommended, Unclassifiable, or No Systemic Therapy. Exposures of interest were patient race/ethnicity, comorbidity, regional median income and poverty prevalence, Part D Low Income Subsidy (LIS) participation, and treatment at an NCI-designated cancer center. We fit multinomial logistic regression models adjusting for patient characteristics and cancer indication. Results: N=9,290 across 11 cancer indications; 18% (1,703) received Optimal therapy, 22% (2,041) LNI, 10% (904) Inferior/Non-Recommended, 7% (688) Unclassifiable, and 43% (3,954) No Systemic Therapy. Compared to non-LIS participants, LIS participants trended towards lower likelihood of receiving Optimal therapy vs. LNI (OR = 0.87, 95%CI 0.72-1.04), Inferior/Non-Recommended (OR = 0.79, 95%CI 0.62-1.01), Unclassifiable (OR = 0.74, 0.57-0.95), or No Systemic Therapy (OR = 0.54, 95%CI 0.46-0.64). Patients with ≥3 comorbidities (vs. 0) were less likely to receive Optimal therapy vs. LNI (OR = 0.78, 95%CI 0.64-0.95), Inferior/Non-Recommended (OR = 0.77, 95%CI 0.59-1.01), Unclassifiable (OR = 0.49, 0.37-0.66), or No Systemic Therapy (OR = 0.66, 95%CI 0.55-0.79). Other exposures were not associated with Optimal therapy. Conclusions: After adjusting for comorbidity – which may be an appropriate consideration in therapy selection – LIS participants remained less likely to receive anticancer systemic therapy and, contingent on receiving therapy, less likely to receive Optimal therapy for their cancer type. These results suggest that despite the LIS program subsidy for oral/Part D drugs, LIS-participating cancer patients may still face financial barriers to receiving infused/Part B cancer drugs.

The Effect of Elevating the Supplemental Poverty Measure on Government Program Eligibility and Spending

Abstract A recent National Academy of Sciences report recommends elevating the Supplemental Poverty Measure (SPM) to the “nation’s headline poverty statistic.” I project how making the SPM the official poverty measure would affect eligibility for government assistance programs whose eligibility thresholds are tied to the official poverty line. Making the SPM the official poverty measure would increase the poverty line for a family of four by 20 percent in 2024. The eligibility threshold for a family of four would consequentially increase by $8320 for the Supplemental Nutrition Assistance Program (SNAP), $8512 for Medicaid adults, and by larger amounts for Medicare Part D Low Income Subsidies, the National School Lunch Program, and Affordable Care Act premium subsidies (once temporarily relaxed eligibility rules are restored in 2026). Effects on eligibility thresholds would grow over time because the SPM thresholds grow faster over time than the current official thresholds. As a result of the higher eligibility thresholds, I estimate that in 2024 SNAP would cover 2.0 million additional households with spending rising by $2.6 billion, and that Medicaid would cover 1.3 million additional recipients with spending rising by $5.6 billion.

Prevention and Mitigation of Rural Higher Education Dropout in Colombia: A Dynamic Performance Management Approach.

Background: Dropout in higher education is a socio-educational phenomenon that has the scope to limit the benefits of education as well as to widen social disparities. For this reason, governments have implemented various public policies for its prevention and mitigation. However, in rural populations, such policies have proven to be ineffective. The aim of this paper is to simulate public policy scenarios for the treatment of school dropout in rural higher education in Colombia from a Dynamic Performance Management approach. Methodology: To achieve the aim, a parameterised simulation model was designed with data from Colombian state entities in rural higher education. Five simulations were carried out. The analysis of the results was carried out using descriptive statistics and comparison of means using the Wilcoxon Sign Rank statistic. Results: The adoption of such an approach based on simulations suggests that policies to expand the coverage of educational credits and financial support, as well as the addition of a family income subsidy, allow for a reduction in the number of dropouts. Conclusions: A dynamic, data-driven approach can be effective in preventing and mitigating dropout in these areas. It also highlights the importance of identifying the key factors contributing to dropout. The results also suggest that government policies can have a significant impact on school retention in rural areas.

Do Farm Subsidies Effectively Increase Grain Production? Evidence from Major Grain-Producing Regions of China.

The purpose of this paper is to investigate the impact of agricultural subsidies on grain production in major grain-producing regions. We use an empirical model and data from fixed observation points in rural areas collected by the Ministry of Agriculture and Rural Affairs in 2016-2017. Our findings show that agricultural subsidies in major grain-producing regions have significantly increased rural household grain yield. Furthermore, findings show that agricultural subsidies and the cost of fertilizer and pesticides for rural households have a mediating effect on grain production. In addition, the effect of agricultural subsidies varies by type: income subsidies have a greater promotion effect on grain production, whereas subsidies for purchasing agricultural machinery have no significant promotion effect on grain production. These findings show that agricultural subsidies promote grain production in China's major grain-producing regions, and have a mediating effect on different types of subsidies.

Understanding the spatiality of the rural poor's livelihoods in Northeast China: Geographical context, location and urban hierarchy

The livelihoods approach has become dominant for understanding poverty issues and advising on development policies. Spatial perspectives have been increasingly recognised to be important for understanding the increasing complexity and dynamics of livelihoods with regional development, urbanisation and close rural-urban interactions. This study further develops this perspective by highlighting the concepts of geographical context, location and urban hierarchy and adopts a multi-scalar analytical approach. The study examines the rural poor's livelihood strategies in Jilin Province of China based on two surveys conducted with about 3000 households in total and multiple logistic regression analysis. Our results demonstrate that half of the rural poor depend on incomes and livelihood strategies without labour input. From a macro-spatial view, the rural poor living in the Western and Eastern Areas, which have more challenging geographical contexts, are more dependent on subsidy income. From a micro-spatial view, rural livelihoods change, with spatial patterns depending on distance to urban areas and the type of these areas; small and medium-sized urban areas are more important for the rural poor's livelihoods. Geographical context makes these urban effects on rural livelihoods spatially more heterogeneous. Spatial understandings of livelihoods research help to better target and tailor poverty alleviation policies.

Multiple Concurrent Causal Relationships and Multiple Governance Pathways for Non-Pharmaceutical Intervention Policies in Pandemics: A Fuzzy Set Qualitative Comparative Analysis Based on 102 Countries and Regions.

The global outbreak of COVID-19 has been wreaking havoc on all aspects of human societies. In addition to pharmaceutical interventions, non-pharmaceutical intervention policies have been proven to be crucial in slowing down the spread of the virus and reducing the impact of the outbreak on economic development, daily life, and social stability. However, no studies have focused on which non-pharmaceutical intervention policies are more effective; this is the focus of our study. We used data samples from 102 countries and regions around the world and selected seven categories of related policies, including work and school suspensions, assembly restrictions, movement restrictions, home isolation, international population movement restrictions, income subsidies, and testing and screening as the condition variables. A susceptible-exposed-infected-quarantined-recovered (SEIQR) model considering non-pharmaceutical intervention policies and latency with infectiousness was constructed to calculate the epidemic transmission rate as the outcome variable, and a fuzzy set qualitative comparative analysis (fsQCA) method was applied to explore the multiple concurrent causal relationships and multiple governance paths of non-pharmaceutical intervention policies for epidemics from the configuration perspective. We found a total of four non-pharmaceutical intervention policy pathways. Among them, L1 was highly suppressive, L2 was moderately suppressive, and L3 was externally suppressive. The results also showed that individual non-pharmaceutical intervention policy could not effectively suppress the spread of the pandemic. Moreover, three specific non-pharmaceutical intervention policies, including work stoppage and school closure, testing and screening, and economic subsidies, had a universal effect in the policies grouping for effective control of the pandemic transmission.

THE CAUSES OF POVERTY AND INFANT MORTALITY IN THE DISTRICT KECH, TURBAT, BALOCHISTAN

This study investigated the theoretical and empirical relationship among the income, poverty and infant mortality differences in district Kech, Turbat Balochistan. The study analyses the relative influence of a number of biological, social, and economic factors on the risk of infant mortality on the basis of national data collected since 2000 to 2016 in the concerned departments. The analytical methods used on multidimensional contingency tables offer an assessment of the relative risks of infant deaths in various sub-populations, with the documented combination of the birth and death data, with the coefficient estimates of these models being used. The Hospital care during the neonatal period, however, seems to reduce this increased risk for some high-risk infants. The continued poverty and unequal access to health care for expectant mothers and young moms in Turbat city and its environs show that these disparities have persisted into the present. To reduce these disparities, it is advised to increase access to and support for family health services through income subsidies and employment programming.

Do Firms That Are Disadvantaged by Unilateral Climate Policy Receive Compensation? Evidence from China’s Energy-Saving Quota Policy

Inequities caused by a unilateral climate policy may threaten the sustainability of CO2 emission reduction efforts by countries and firms, thus endangering sustainable development for humans and the eco-environment. However, few studies have conducted ex-post evaluations on whether environmentally regulated firms receive external compensation such as subsidies, tax reductions, and loan support. Thus, this study investigates whether firms experiencing inequitable conditions under China’s Energy-Saving Quota Policy (ESQP) are financially compensated. It develops a balanced panel of data from 6189 ESQP-regulated and 6189 unregulated firms from 2010 to 2013, and combines a probit model with the difference-in-differences method to conduct empirical analysis. The results show that ESQP-regulated firms receive more subsidy income and lower tax rates than unregulated firms. Of the ESQP-regulated firms, companies with higher energy-saving burdens receive larger subsidies and lower financial expense ratios than those with lower burdens. Additionally, firms that complete their energy-saving quotas are compensated with larger subsidies and/or lower financial expense ratios and tax rates than those that fail to complete them. Finally, state-owned firms receive more subsidies than private ones. Unlike the emission trading schemes implemented worldwide that formulate an exemption mechanism (i.e., free or over-allocated allowances), the ESQP does not exempt regulated firms from their energy-saving responsibilities. Rather, regulated firms receive a greater amount of external compensation in exchange for their reductions in energy consumption.

Spatiotemporal patterns in China's Minimal Living allowances: The urban‐rural gap and regional differences revealed through a national poverty alleviation program

AbstractThe Minimal Living Standard Allowance System (MLSAS), established by the Chinese central government in the late 1990s, was intended to provide basic needs for urban and rural low‐income populations. Although the subsidy standards of MLSAS have increased rapidly over the years, its distributions in time and space were found imbalanced. Using the per capita subsidy income (PCSI) data of 338 Chinese cities from 2008 to 2016, this study quantified the spatiotemporal patterns of the urban‐rural gap and regional differences of MLSAS throughout China and identified the major influential socioeconomic factors of the observed patterns. The results showed that the PCSI of China's low‐income populations increased rapidly but with large variations between urban and rural residents and between geographic regions. The PCSI in rural areas was much lower than that in urban areas, whereas the Gini coefficient of PCSI in urban areas was lower than that in rural areas, indicating the allowance from MLSAS was more unequal among rural residents. Additionally, the higher PCSI was concentrated mainly in three urban agglomerations in eastern China. Most cities in central and western China lagged in terms of PCSI. Correlation analysis between PCSI and socioeconomic factors indicated that the income and GDP per capita were the most important influencing factors. With a better understanding of the overall situation of the urban‐rural gap and regional differences in implementing MLSAS, the current study should help improve the subsistence subsidy policies in China.

Regression Discontinuity for Binary Response and Local Maximum Likelihood Estimator to Extrapolate Treatment.

Regression discontinuity is popular in finding treatment/policy effects when the treatment is determined by a continuous variable crossing a cutoff. Typically, a local linear regression (LLR) estimator is used to find the effects. For binary response, however, LLR is not suitable in extrapolating the treatment, as in doubling/tripling the treatment dose/intensity. The reason is that doubling/tripling the LLR estimate can give a number out of the bound , despite that the effect should be a change in probability. We propose local maximum likelihood estimators which overcome these shortcomings, while giving almost the same estimates as the LLR estimator does for the original treatment. A simulation study and an empirical analysis for effects of an income subsidy program on religion demonstrate these points.

Technical change and the Common Agricultural Policy

This paper adopts an alternative method for the analysis of the CAP’s impact on farms’ productivity based on a system of equations derived from a non-nested three-factors CES production function. With this method, we estimate the elasticity of substitution between labour, capital, and land in the EU agricultural sector, the magnitude and direction of technical change, and the impact of the CAP subsidies. The system of equations is estimated using the GMM estimator on a farm-level panel dataset covering 117,179 farms from all EU MS for the period from 2004 to 2015. Our results suggest that land, labour, and capital in EU farms are complementary production factors characterised by a slow decline or stagnation in the land-, labour-, and capital-augmented technical change. Higher levels of Pillar I and Pillar II CAP payments as percentage of total agricultural income have negative or no impact on farms’ technical change, but higher nominal amounts of Pillar I decoupled subsidies, Pillar II investment and LFA subsidies have a positive impact. Moreover, the larger the share of subsidies in total agricultural income the stronger is the negative impact of the CAP on agricultural technical change.

The role of subsidies in stabilising farm income: Evidence from Estonia

This study examines the role of agricultural subsidies in the farm income (FI) variation in Estonia in the period 2006–2019 using data from a balanced panel of Farm Accountancy Data Network (FADN) farms. FI variability is decomposed to three components: market income, total subsidies, and the cost of external factors. The results reveal that subsidies have a larger share in income of smaller farms. Variability of FI differs in farm size quartiles and is significantly lower in case of largest 25% of farms. Revenues are the largest source of variation of FI. While subsidies reduce FI variation, there is no evidence that they are counter-cyclical. We argue that in addition to subsidies, smaller farms need advice on farm management to increase market income, improve its stability, and expand farm size, as larger farms have more stable incomes despite relatively lower producer support estimate (PSE) levels.

Consumption Response to Government Income Subsidies: Korea’s Case

The Republic of Korea Government implemented a universal consumption subsidy program to combat the coronavirus disease 2019 (COVID-19) economic downturn in 2020. Using granular, micro-level transaction data, we find that the subsidy scheme has stimulated household consumption immediately after receipt. Moreover, lower income groups demonstrate higher marginal propensity to consume than middle and higher income groups; this holds true even when creating synthetic control groups that model rational spending behavior. This can have a significant implication on the effectiveness of fiscal impulse. Using income and average historical credit card spending, we also demonstrate credit and liquidity constraints are major factors affecting consumption responses.

Has the Resignation of Independent Directors Holding Government Positions Improved Firm Performance?—A Quasi-Natural Experiment From China

The Organization Department of the Communist Party of China (CPC) announced the Opinions on Further Regulation on Party and Political Leaders and Cadres Working Part-Time (Holding Offices) in Enterprises to force the resignation of government officials holding the position of independent director in listed companies (GID). This paper empirically examines the impact of the GID resignation on firm performance using a difference-in-differences (DID) model, which is an exogenous event with a “natural experiment.” The study finds that after the promulgation of the Opinions, firms that lose some of their political resources and their corporate performance decreases significantly compared to firms that do not experience GID resignations. A good external governance environment, while somewhat weakening, is not sufficient to offset the negative impact of the loss of political resources on firm performance. This paper further explores the mechanism by which the GID resignation affects firm performance: one important way in which the resignation of GIDs cause the loss of political resources on which the firm's development depends is that the loss of the firm's tax benefits after GID resignation directly leads to a decline in performance; it also leads to a reduction in the firm's financial subsidy income and a reduction in the amount of bank loans, but both of these do not have a significant effect on the decline in firm performance. The study suggests that GIDs play more of a resource-providing “official” role than an “independent director's” supervisory and advisory role in Chinese listed companies. The findings of this paper reveal the phenomenon of “Political-Business Spin” in China, which has some implications for developing countries, represented by China, to improve the independence of the board of directors and the corporate governance.

The Impact of Livelihood Sources on Relative Poverty among Households in the Karst Mountains, a case study from Huajiang demonstration area, SW China

ABSTRACT After eliminating absolute poverty in 2020, China is shifting its focus from poverty eradication to achieving common prosperity, and relative poverty is currently a research focus.This paperuses interdisciplinary analysis methods to measure households’ livelihood sources and relative poverty in the karst mountains and explore the impact of livelihood sources on relative poverty. The results show that relative poverty in the Huajiang demonstration area is mainly manifested by a lack of material conditions influenced by natural conditions. The status of household labour, production conditions, social networks and natural conditions affect households’ livelihood sources. Increasing household livelihood sources can significantly alleviate their relative poverty status. The increase in household livelihood sources , agricultural modernization and breeding specialization can all significantly reduce household poverty level, whereas increased subsidy income may reduce the incentive for households to develop themselves. The study’s findings provide an important scientific basis for improving the livelihood resilience of households in the karst mountains and help consolidate and expand poverty alleviation.

Shapley Value and Income Taxation

Income taxation is modeled as a spatial voting game where Shapley value leads to a simple linear tax function on gross income with a single marginal tax rate and a universal basic income subsidy. Shapley net income is not generally in the game core; therefore, it is inherently unstable and subject to relentless pressure from higher gross income individuals to reduce their taxes and increase their net incomes.