Welfare Effects Research Articles

The Animal Welfare Consequences and Moral Implications of Lethal and Non-Lethal Fox Control Methods.

Control methods are applied worldwide to reduce predation on livestock by European red foxes (Vulpes vulpes). Lethal methods can inflict suffering; however, moral debate about their use is lacking. Non-lethal methods can also inflict suffering and can unintentionally lead to death, and yet both the welfare consequences and ethical perspectives regarding their use are rarely discussed. The aim of this study was to investigate the animal welfare consequences, the level of humaneness, the ethical considerations and the moral implications of the global use of fox control methods according to Tom Regan's animal rights view and Peter Singer's utilitarian view. According to Regan, foxes ought not to be controlled by either lethal or potentially harmful non-lethal methods because this violates the right of foxes not to be harmed or killed. According to Singer, if an action maximises happiness or the satisfaction of preferences over unhappiness or suffering, then the action is justified. Therefore, if and only if the use of fox control methods can prevent suffering and death in livestock in a manner that outweighs comparable suffering and death in foxes is one morally obligated to use them. It is clear that lethal fox control methods and some non-lethal methods are inhumane.

The macroeconomic effects of universal basic income programs

I develop a heterogeneous agents overlapping generations model to assess the welfare effects of substituting the US income security system with a UBI policy. I study two counterfactual exercises: an expenditure-neutral reform and a large, policy-oriented UBI reform with a transfer equivalent to $1000 monthly, both financed by changes in the consumption tax. The first exercise has a moderate fiscal impact, induces increases in the aggregate output and employment, and reduces earnings and wealth inequality. The second exercise requires a large increase in the consumption tax rate, decreases employment and output, and increases earnings inequality, which moves sideways for wealth. In both cases, disposable income and consumption are more equally distributed, with less accrual at the top. The two economies generate positive welfare gains, with those for the generous UBI economy being larger.

Nonparametric Approaches to Empirical Welfare Analysis

Welfare analysis of policy interventions is ubiquitous in economic research. It plays an important role in merger analysis and antitrust litigation, design of tax and subsidies, and informs the current debate on a universal basic income. This paper provides a survey of existing empirical methods, based on cross-sectional microdata, for calculating welfare effects and deadweight loss resulting from realized or hypothetical policy change. We briefly outline classical parametric methods that are computationally tractable, then discuss recent nonparametric approaches that avoid making statistical and functional-form restrictions on individual preferences. This makes the welfare estimates theoretically more credible, and clarifies exactly what welfare-relevant information is contained in demand distribution in various choice settings. However, these methods also demand greater in-sample variation in the data for practical implementation than classical parametric approaches. We then cover settings with externalities. The above results are theoretical, and take the demand function as known; therefore, we briefly discuss empirical problems around demand estimation. We conclude by suggesting areas for future research. (JEL C14, C35, D11, D60, D62)

Pengaruh Kualitas Kehidupan Kerja Terhadap Komitmen Organisasional Dengan Kesejahteraan Karyawan Sebagai Variabel Mediasi (Studi pada Karyawan Peternakan Ayam Petelur di Kecamatan Purbolinggo, Kabupaten Lampung Timur)

The phenomenon of employees resigning from their company or the low level of organizational commitment in employees is thought to be caused by poor quality of work life, besides the role of employee welfare to mediate between the influence of quality of work life on organizational commitment. The purpose of this study is to determine whether there is a direct effect of quality of work life on organizational commitment and whether the indirect effect of employee welfare can mediate the effect of quality of work life on organizational commitment. This research uses a type of quantitative research. This study uses primary data obtained by distributing questionnaires directly through questionnaires at CV Sekuntum Herbals and PT Sanjaya Satwa Utama, the data obtained is then processed using the AMOS SEM analysis tool. The population in this study were employees of CV Sekuntum Herbals and PT Sanjaya Satwa Utama who had worked for at least one year and obtained the results of respondent data that met the criteria of 128 people. So that a sample of 120 respondents was obtained because there were 3 questionnaires that were not returned and 5 questionnaires that were not filled in completely. The results of this study are that the quality of work life has a significant positive effect on organizational commitment, then employee welfare mediates positively and significantly between the influence of work life quality on organizational commitment.

Macroeconomic analysis of the child benefit: Fertility, demographic structure, and welfare

This paper examines the macroeconomic and welfare effects of the child benefit, using a general equilibrium overlapping generations model incorporating fertility choices. The model is calibrated to Japan and produces the benefit elasticity of fertility in line with the empirical estimates. Expanding the per-child payment leads to welfare gains for future generations in the long-run equilibrium. Notably, the long-run gains extend to individuals who are childless throughout their lives and do not receive child benefits. Higher fertility rates facilitated by the expansion and the resulting demographic change account for the results via several channels. However, reaching the new equilibrium takes approximately 100 years as the demographic change necessitates sufficient transition periods. The accrual of welfare gains is thus gradual and takes a long time.

A Macro Study of the Unequal Effects of Climate Change

This paper develops a macro heterogeneous-agent model to quantify the distributional impacts of higher temperatures in the US. Households adapt to temperature by using energy and equipment for heating and cooling. A key insight is that temperature acts as a transfer from nature, augmenting household income by the value of heating or cooling provided by nature. The welfare effects of climate change vary substantially with income, increasing welfare inequality in the colder parts of the US. This heterogeneity results from the effects of climate change on transfers from nature and on households’ extensive-margin decisions to purchase heaters and air conditioners.

Losing Ground: Measuring the Welfare Effects of Retail Food Price Inflation during the COVID-19 Pandemic on Mexican Household

Abstract As worldwide food prices rise, there is a growing interest in understanding the effect of these increases on households. Building on previous work, while applying recent methodological advances, we focus our attention on México during the COVID-19 pandemic. We document these price escalations for a basket of foods representative of Mexican households’ diets. The price increases are substantial across the basket, ranging from 20 percent in meat to 40 percent in tortilla. Using these estimates, we calculate the welfare effect from the recent food price escalation to cost households $17.07 billion annually, close to 1.5 percent of Mexico’s Gross Domestic Product in 2020. We estimate households would need to increase their food expenditure budgets by 28.66 percent, the compensating variation, to achieve pre-price increase utility levels.

Raising America’s future: Search for optimal child-related transfers

The US differs from other OECD countries in terms of family policy size and composition. This study examines the welfare and macroeconomic effects of family policy reforms. I explore three policy instruments: child-related tax credits, childcare subsidies, and child allowances. The children are merit good due to pay-as-you-go social security structure. I show that expanding family policy, like the American Rescue Plan, improves welfare. I also define the optimal family policy for the United States. It accounts for about 3% of GDP, three times larger than the existing policy, and primarily focused on childcare subsidies. Family policy structure is critical for welfare evaluation because similar expenditure levels can result in contrasting welfare outcomes depending on policy composition. This study emphasizes the importance of carefully designed family policies, as well as the need for ongoing research and policy innovation to maximize societal benefits and promote equitable economic growth.

Surveillance capitalism and the surveillance state: a comparative institutional analysis

AbstractWhat is the connection between mass surveillance and institutions of individual agency, freedom, and self-governance? Recent literature on “surveillance capitalism” argues that, over the past two decades, the capitalist Big Tech companies have commodified personal data for profit. This commodification goes beyond gathering information to improve the products provided by the collecting organization directly and entails using data to predict what people will do, the sale of that data, and its use to modify the behaviors of unknowing consumers. According to critics, this erodes individual dignity and freedom while also threatening democracy. This paper offers an alternative framing of surveillance and data collection based on comparative institutional analysis. While data collection and attempts at persuasion are present in private and government settings, the welfare effects vary due to institutional differences. We leverage the comparative institutional framework to analyze the differences between private data collection (“surveillance capitalism”) and government data collection (the “surveillance state”). Our analysis sheds light on how data collection in the private, for-profit sector has different welfare consequences from those in the surveillance state.

Call for multi-policy approach: Synergistic effects of emissions trading scheme and energy efficiency policies

Limited research exists on the synergistic effects of carbon emissions trading and energy efficiency policies despite their significance in achieving global carbon neutrality objectives. This study examines the synergistic effects of carbon emissions trading and energy efficiency policies on aspects of the environment, energy, and economy. Results show that the synergistic effect leads to an additional reduction of 1.2% in carbon emissions, along with a decrease of 4.2% in economic losses. Despite challenges like increased energy external dependency and carbon leakage, the synergistic effect shows a positive externality between policies, reducing the carbon intensity and marginal emission mitigation costs. Furthermore, these synergistic effects yield positive consequences for social welfare, particularly benefiting rural households and fostering equitable distribution of carbon mitigation benefits across societal groups. These findings underscore the importance of considering policy synergies between carbon emissions trading and energy efficiency policies to ensure the total effect of climate change mitigation strategies.

Cross‐ownership, business dynamism, and wage inequality in general equilibrium

AbstractThis study examines the distributive and welfare effects of cross‐ownership by firms in a general equilibrium economy on the product and factor markets. The cross‐ownership of equities, such as collusion, tends to be anticompetitive, thereby narrowing the wage gap between skilled and unskilled labor in the short term with the existing number of firms. In the capital market, reducing capital cost through cross‐ownership causes new firms to enter the market in the long term. This firm‐entry effect induced by cross‐ownership through an increase in the number of competitors generates a competitive force that exacerbates wage inequality and reduces welfare in the economy.

Welfare effects of variable and fixed cost subsidies in profit, non‐profit and mixed markets

AbstractWhereas various support mechanisms are in place to correct market failures, knowledge on their welfare effects is still incomplete. This paper, applying a Bertrand approach, studies and compares the effects of variable and fixed cost subsidies on consumer surplus, producer surplus, total surplus and total surplus net of distorting tax effects (‘overall surplus’) in three different market settings: a for‐profit duopoly, a duopoly with two non‐profit organisations and a mixed duopoly, the duopolists in each case supplying mutually exclusive goods or services. In a for‐profit duopoly, more variable cost subsidies lead to an increase of both consumer and producer surpluses, where the latter is impacted most. The higher the level of demand interaction between the two products, the higher the welfare impact. In the non‐profit setting, we establish that the effects of changing fixed cost subsidies on the fiscal cost are more substantial than in the for‐profit duopoly. Subsidies in mixed competition also generate an impact on both producer and consumer surpluses. The effects on overall surplus are shown to depend in complex ways on the level of demand interaction between the products, the shadow cost of taxation and the firms' cost levels.

Economy-wide Impacts of India–UAE CEPA: A CGE Analysis

The present study investigates the potential trade effects of tariff liberalisation under India–United Arab Emirates (UAE) Comprehensive Economic Partnership Agreement (CEPA) using general equilibrium analysis. The study specifically examines output, employment, exports and welfare effects of India–UAE CEPA in computable general equilibrium (CGE) framework using the Global Trade Analysis Project (GTAP) model and database version 10. The study indicates output gains in manufacturing sector for both countries and an increase in demand for unskilled labour in India. The study argues that the CEPA will result in an increase in global exports of all commodity groups for both India and UAE and a substantial gain in bilateral exports of both countries. The present study suggests that deeper integration through tariff reduction on imports under India–UAE CEPA will be welfare enhancing for both India and UAE. Overall results show that there is a lot of untapped potential to bring the welfare gains for both trading partners. Given the present schedule of tariff reduction of CEPA, a win–win scenario will emerge for both partners in short as well as long run. Finally, the study cautioned about the implications of sensitive list for trade effects and protection from misuse of rules of origin in the CEPA. JEL Codes: F1, F13, F14, F15, F17

The Impact and Spatial Spillover Effects of Tourism Development on Urban Welfare: Empirical Evidence from the Yangtze River Delta in China

The ultimate goal of China’s tourism industry is to create a flourishing sector that brings happiness. It is of immense theoretical and practical importance to investigate the impact of tourism development (TD) on urban welfare (UW) and uncover its spatial spillover characteristics from a macro perspective. Utilizing panel data from 41 cities in the Yangtze River Delta region from 2000 to 2021, this study applies the spatial panel Durbin model to explore the direct and spillover effects of TD on UW. The results show that TD significantly boosts UW in both local and neighboring areas, with the spillover effects taking a dominant position in the total effects. Examining the sub-dimensions of UW, the local welfare effects of TD primarily stem from economic welfare, whereas the spillover effects are characterized by the “three-wheel drive” of economic, social, and environmental welfare. This study can provide practical insights into the coordinated and sustainable development of the regional tourism industry.

Welfare effect analysis of pay-as-you-go pension system: Deconstruction from the perspective of relative utility and social equality.

This paper studies the redistributive effects of two major pay-as-you-go pension systems by constructing an intergenerational iterative model which does not only considers standard utility but also relative utility. The study find that the two main pay-as-you-go pension systems are both sustainable. If we consider different preferences, then the choice of pension system should depend on the question of whether individuals are more interested in the absolute level of consumption or in the consumption related to a reference group. If the latter is more important, the Beveridgean system is superior, it provides greater protection for vulnerable groups than the Bismarck pension system, and the pension income after retirement is relatively more balanced, but the price is a lower level of consumption in the long run compared to an economy with Bismarckian system. If individuals prefer instead the absolute level of consumption, the Bismarckian system is better, because it guarantees a comparable higher level of consumption, but the disadvantaged groups face a higher risk of poverty and the degree of social inequality will be relatively higher. However, it is important to note that in the long run, only the level of consumption differs, not the speed of growth or number of children.

On the Welfare Costs of Perceptions Biases

AbstractAre households harmed by inaccurate inflation beliefs? This paper analyzes two established inflation perceptions biases and evaluates their welfare effects. Using French survey data I study the frequency bias, where households overweight goods that they purchase frequently, and the level bias, where households consistently overestimate current inflation. To evaluate the associated welfare losses, I incorporate biased inflation perceptions into a model with a nominal bond subject to inflation risk. Only the level bias significantly reduces welfare and asset accumulation. Removing the perception bias reduces the welfare loss, suggesting that inaccurate perceptions can harm households beyond affecting expectations.

The Effect of Religious Understanding, Social Welfare, and Cultural Values of The Community Towards The Sacred Tomb

This research aims to determine the effect of religious understanding, social welfare and community cultural values on the sacredness of Astana Dua in Kampung Pasir Kaur, Weninggalih Village, Sindangkerta District, West Bandung Regency. The research method uses a quantitative approach with inferential statistical analysis. The research results prove that each independent variable (x1, x2 and x3) either partially or jointly has an influence on the dependent variable (Y). Strictly speaking, this study can accept and prove the hypothesis which states that, together the variables X1, X2 and X3 have a very strong influence on the Astana Dua Sacrality with a correlation coefficient of 0.941 and the significance of the ANOVA test (F test) is at a value of 0.000. The coefficient of determination together is 88.50%, and the remaining 11.50% is the influence of factors other than religious understanding, social welfare and cultural values that require further research. the implications for community education in Kampung Pasir Kaur are profound. Educational initiatives must be thoughtfully designed to balance religious, economic, and cultural learning, promoting a well-rounded understanding that respects and upholds the community’s traditional values and sacred sites. This integrated approach can serve as a model for other communities facing similar challenges, providing a blueprint for education that supports cultural preservation while fostering socioeconomic and spiritual growth.

Technology Transfer in Global Value Chains

Global value chains create opportunities for North-South technology diffusion. This paper studies technology transfer in value chains when contracts are incomplete and input production technologies are imperfectly excludable. It introduces a new taxonomy of value chains based on whether the headquarters firm benefits from imitation of its supplier’s technology. In inclusive value chains, where imitation is beneficial, the headquarters firm promotes technology diffusion. But in exclusive value chains headquarters seek to limit supplier imitation. The paper analyzes how this distinction affects the returns to offshoring, the welfare effects of technical change, and the social efficiency of knowledge sharing. (JEL F16, J23, J24, J31)

What Are the Benefits of Government Assistance with Household Energy Bills? Evidence from Ukraine

On February 24, 2022, Russian Federation troops invaded Ukraine. Ukraine was previously at war with Russia in 2014, and in April 2015, the government abruptly raised the natural gas tariffs to residential customers. It also scaled up its energy assistance program, the HUS. We examine the welfare effects of the HUS. Using Ukraine’s Household Budget Survey, we find that after the tariff hike, the average household that did not receive the HUS spends 11% of its income on electricity, gas, and fuels, meeting the definition of "fuel poor." The average share among households that do receive the subsidy is [Formula: see text]. The HUS cuts the rate of fuel poverty in half and brings considerable consumer surplus gains (6% of income), at a price tag of 1-2.5% of GDP. Meaningful savings would be achieved with only a moderate loss of consumer surplus if the HUS was cut in half. Social tariffs or replacing the HUS with a one-time energy efficiency subsidy would be sustainable and entail modest or no welfare losses.

The welfare effects of mobile broadband internet: Evidence from Nigeria

This paper estimates the impacts of mobile broadband coverage on household welfare in Nigeria. The analysis exploits a unique data set that integrates a longitudinal household survey with information from Nigerian mobile operators on the deployment of mobile broadband internet between 2010 and 2016. Overall, estimates show that mobile broadband coverage had large and positive impacts on household consumption thereby reducing poverty significantly. This effect is if anything stronger among poorer households. Labor force participation explains a big part of this welfare-enhancing effect.