Showing papers on "Purchasing power published in 2011"

Structural Reforms and Macroeconomic Performance in the Euro Area Countries: A Model-Based Assessment

Abstract: We quantitatively assess the macroeconomic effects of country-specific supply-side reforms in the euro area by simulating EAGLE, a multi-country dynamic general equilibrium model. We consider reforms in the labor and services markets of Germany (or, alternatively, Portugal) and the rest of the euro area. Our main results are as follows. First, there are benefits from implementing unilateral structural reforms. A reduction of markup by 15 percentage points in the German (Portuguese) labor and services market would induce an increase in the long-run German (Portuguese) output equal to 8.8 (7.8) percent. As reforms are implemented gradually over a period of five years, output would smoothly reach its new long-run level in seven years. Second, cross-country coordination of reforms would add extra benefits to each region in the euro area, by limiting the deterioration of relative prices and purchasing power that a country faces when implementing reforms unilaterally. This is true in particular for a small and open economy such as Portugal. Specifically, in the long run German output would increase by 9.2 percent, Portuguese output by 8.6 percent. Third, cross-country coordination would make the macroeconomic performance of the different regions belonging to the euro area more homogeneous, both in terms of price competitiveness and real activity. Overall, our results suggest that reforms implemented apart by each country in the euro area produce positive effects, cross-country coordination produces larger and more evenly distributed (positive) effects.

Purchasing Power Parity Exchange Rates for the Global Poor

Abstract: The first of the Millennium Development Goals targets global poverty. The global poverty number is estimated by the World Bank as a worldwide count of people who live below a common international poverty line. This line, loosely referred to as the dollar-a-day line, is calculated as an average over the world’s poorest countries of their national poverty lines expressed in international dollars. The average is then converted back to local currency to calculate each country’s counts of those living below the line. The counts come from household surveys, the number and coverage of which have steadily increased over the years. The conversion of national poverty lines to international currency and the conversion of the global line back to local currency are both done using purchasing power parity (PPP) exchange rates from the various rounds of the International Comparison Program (ICP). These PPPs, unlike market exchange rates, are constructed as multilateral price indexes using directly observed consumer prices in many countries. This paper is about the construction of the PPPs and their effect on the poverty estimates. In the first dollar-a-day poverty calculations, the World Bank (1990) used price indexes for GDP, but this practice was later improved by the use of price indexes for household consumption. Yet even this may be misleading if the price indexes for national aggregate consumption are different from those relevant for people who live at or around the global poverty line. Price indexes are weighted averages

Inflation and Nominal Financial Reporting: Implications for Performance and Stock Prices

Abstract: The monetary unit assumption of financial accounting assumes a stable currency (i.e., constant purchasing power over time). Yet, even during periods of low inflation or deflation, nominal financial statements violate this assumption. I posit that, while the effects of inflation are not recognized in nominal statements, such effects may have economic consequences. I find that unrecognized inflation gains and losses help predict future cash flows as these gains and losses turn into cash flows over time. I also find significant abnormal returns to inflation-based trading strategies, suggesting that stock prices do not fully reflect the implications of the inflation effects for future cash flows. Additional analysis reveals that stock prices act as if investors do not fully distinguish monetary and nonmonetary assets, which is fundamental to determining the effects of inflation. Overall, this study is the first to show that, although inflation effects are not recognized in nominal financial statements, they have significant economic consequences, even during a period in which inflation is relatively low.

Inflation and Nominal Financial Reporting: Implications for Performance and Stock Prices

Abstract: The monetary unit assumption of financial accounting assumes a stable currency (i.e., constant purchasing power over time). Yet, even during periods of low inflation or deflation, nominal financial statements violate this assumption. I posit that, while the effects of inflation are not recognized in nominal statements, such effects may have economic consequences. I find that unrecognized inflation gains and losses help predict future cash flows as these gains and losses turn into cash flows over time. I also find significant abnormal returns to inflation-based trading strategies, suggesting that stock prices do not fully reflect the implications of the inflation effects for future cash flows. Additional analysis reveals that stock prices act as if investors do not fully distinguish monetary and nonmonetary assets, which is fundamental to determining the effects of inflation. Overall, this study is the first to show that, although inflation effects are not recognized in nominal financial statemen...

Analysis of Market Participation and Rural Poverty among Farmers in Northern Part of Taraba State, Nigeria

Abstract: Market access plays a remarkable role in ensuring better income and welfare for smallholder farmers through diverse channels. By raising income, markets increase purchasing power, which, in turn, c...

Nigeria's Infrastructure : A Continental Perspective

Abstract: Infrastructure has made a net contribution of around one percentage point to Nigeria's improved per capita growth performance in recent years, in spite of the fact that unreliable power supply held growth back. Raising the country's infrastructure endowment to that of the region's middle-income countries could boost annual growth by around four percentage points. Nigeria has made important strides toward improving much of its infrastructure. Compared to many African peers, Nigeria has relatively advanced power, road, rail, and information and communications technology (ICT) networks that cover extensive areas of the nation's territory. In recent years, Nigeria has conducted several important infrastructure sector reforms. The ports sector has been converted to a landlord model, and terminal concessions now attract private investment on a scale unprecedented for Africa. The power sector is undergoing a restructuring, paving the way for performance improvements; the sector is finally on a path toward raising tariffs to recover a larger share of costs. Bold liberalization measures in the ICT sector have resulted in widespread, low-cost mobile services, Africa's most vibrant fixed-line sector, and major private investments in the development of a national fiber-optic backbone. A burgeoning domestic air transport sector has emerged, with strong private carriers that have rapidly attained regional significance.

Role of Micro Finance in Reducing Poverty: A Look at Social and Economic Factors

Abstract: The thrust of the study lies in knowing the effect of micro finance on the poverty alleviation. In this study it is analyzed that microfinance is an important element for an effective poverty reduction strategy. The role of MicroFinance on poverty alleviation is checked both in social and economic aspects. The social and economic factors considered in this study include the improvement of life style, accommodation standard, income generation, life standard, purchasing power, expansion of business facility, self-employment and adoption of better technology. Economic growth and development is also considered in this study. It reveals that access and efficient provision of micro credit can enable the poor to smooth their consumption, better manage their risks, gradually build their assets, develop their micro enterprises, enhance their income earning capacity, and enjoy an improved quality of life. It argues that with little efforts, the performance of Micro Finance institutions can be improved and these institutions can play their role better in poverty alleviation than usual.

What drives FDI in Central–Eastern Europe? Evidence from the IWH-FDI-Micro database

Abstract: The focus of this article is on the match between strategic motives of foreign investors in Central–Eastern Europe and locational advantages offered by these countries Our analysis makes use of the IWH-FDI-Micro database, a unique dataset that contains information from 2009 about the determinants of locational factors, technological activity of subsidiaries and potential for knowledge spillovers in the Czech Republic, Hungary, Poland, Romania and Slovakia The analysis suggests that investors in these countries are mainly interested in low (unit) labour costs coupled with a well-trained and educated workforce and an expanding market with high growth rates in the purchasing power of potential buyers It also suggests that the financial crisis reduced the attractiveness of the region as a source for localised knowledge and technology There appears to be a match between investors' expectations and the quantitative supply of unqualified labour, though not for the supply of medium qualified workers The anal

Emerging market strategy: innovating both products and delivery systems

Abstract: Purpose – Low customer purchasing power and lack of adequate infrastructure are two difficulties that restrict opportunities in any emerging market. This paper seeks to describe how to overcome these hurdles.Design/methodology/approach – The paper blends two different perspectives on emerging markets: unearthing opportunities at the bottom of the pyramid, and coping with institutional voids, to offer a unified framework and illustrate it with examples.Findings – In order to fully leverage the opportunities afforded by emerging markets, companies need both product and business‐system innovations. The former is needed to serve customers at price points that they can afford and the latter to reach them in the market and to offer them additional services that have the potential to justify a price premium or at the very least will build brand loyalty.Research limitations/implications – The proposed strategy has its own risks. But there are potential payoffs as well. Further research is needed to assess these t...

Senior Customers’ Service Encounter Preferences

Abstract: Growing segment size and increasing affluence have resulted in a substantial increase in the purchasing power of the senior market. Seniors spend a higher proportion of their total expenditure on s...

Fiscal Policy and Growth in Saudi Arabia

Abstract: Whether government spending can boost the pace of economic growth is widely debated. In the neoclassical growth model, it is supplies of productive resources and productivity that determine growth in the long-run. In endogenous growth models, an increase in government spending may raise the steady-state rate of growth due to positive spillover effects on investment in physical and/or human capital. This paper examines the relationship between government spending and non-oil GDP in the case of Saudi Arabia. Using time-series methods and data for 1969-2005, we find that increases in government spending have a positive and significant long-run effect on the rate of growth. Estimated effects of current expenditure on growth turn out to exceed those of capital expenditure—suggesting that government investment in infrastructure and productive capacity has been less growth-enhancing in Saudi Arabia than programs to improve administration and operation of government entities and support purchasing power. We discuss possible reasons for this finding in the Saudi case and draw some policy implications.

Empowering rural consumers in emerging markets

Abstract: Purpose – Rural consumers in emerging market countries are among the largest and fastest growing segments of the world's population. The purpose of this paper is to examine marketing's role in tapping potential in rural areas and suggest how firms can help potential consumers develop their purchasing power, thus creating a situation that benefits both consumers and the firm.Design/methodology/approach – The study is based on information on company web sites (of both multinationals and emerging market firms) and other published information regarding these firms' activities in emerging markets. This was supplemented by personal interviews conducted with marketing executives in India.Findings – It is found that marketing strategy must be developed de novo as strategies adopted in developed markets are not adapted to rural market conditions. This must be based on a thorough understanding of consumers, particularly their multiple roles as producers and consumers. In addition, firms need to focus on finding way...

Living on a Spike: How is the 2011 food price crisis affecting poor people?

Abstract: Global food prices rose through much of 2010 and into early 2011. What does that mean for the lives of poor people in developing countries, who spend up to 80 per cent of their household income on food? To find out, IDS research partners and Oxfam went to ask them, returning in March 2011 to eight community ‘listening posts’ in Bangladesh, Indonesia, Kenya, and Zambia, that were previously visited in 2009 and 2010. The researchers asked: What has happened to prices and wages since last year? How are people adjusting to these changes? What do people think causes food price volatility, and what do they think should be done about it?The overall picture that emerges from these eight communities is of a more varied impact than during the 2008 food and fuel price spike. This is partly because food prices have not risen evenly everywhere. Zambia, for instance, has seen prices of maize (its food staple) decline since 2010, whereas in Bangladesh, Indonesia, and Kenya, the price of the main staple – rice or maize – is higher than in 2010. In all eight communities, prices of most other foods, including sources of protein (meat, fish, tofu, or lentils), vegetables, and cooking oil, have also risen, as have many non-food essentials, such as cooking fuel, transport, rent, and other items, including fertilizer in Zambia.The more uneven impact of the 2011 food price spike also reflects the fact that some groups have seen their earnings rise faster than inflation, while others have not. An overall pattern emerges from the recent global economic volatility: one of ‘weak losers and strong winners’. The losers – those already struggling in low-paid, informal sector occupations such as petty trading, street vending, casual construction work, sex work, laundry, portering, and transport – are doing worse. Many have seen stagnant or only slightly raised rates of pay, which have been swallowed up by higher food prices, combined with more erratic access to work or customers. These people are clearly worse off than last year. They strongly believe that the government is not on their side in their efforts to eke out a living. Regulations on where people can run their businesses or provide their services, police harassment, and unfavourable new laws mean that making a living has got harder, not easier, for many in this group over the past year.But some groups – usually those who were already relatively better off – have done better than last year. Commodity producers and export sector workers have largely benefited from the global recovery, as have some people in other occupations linked to these groups. But minimum wage rises for garments export workers in Bangladesh (now at $41 per month) have not come about as a result of the global recovery; a long and sometimes violent campaign was necessary to raise workers’ wages there. In contrast, export sector workers in Indonesia are not feeling any better off, even though there are more jobs and the minimum wage has increased at its (Indonesian) regional rate. This is because there is now more competition and tighter eligibility conditions on export sector jobs, and contracts are more ‘flexible’ – shorter-term, with poorer benefits – than before the crisis.Groups such as public sector workers have not become significantly better off, but their strong position in relation to governments has at least ensured that their earnings have kept pace with inflation. Small-scale farmers and small market and food traders have not generally done well, despite the high price of food. High input costs and the squeeze on people’s purchasing power has meant that profits from growing and selling food remain low for those with least scope to diversify and spread their risk.People are adjusting to high food prices in more nuanced ways this year, compared with 2009. While some people are eating less and going hungry, the more usual pattern is for people to shift to cheaper, less preferred, and often poorer-quality foods – sometimes bland food cooked without oil or condiments, unfamiliar cuts of meat, poorer-quality staples, and in general, less diverse diets. The social effects of the food price rises also seem more moderate: there were fewer reports of children being withdrawn from school, but an increasing sense of concern about dependence on debt. Yet, the effects differ by gender, and in ways that are familiar from previous rounds of the research: women come under more pressure to provide good meals with less food, and feel the stresses of coping with their children’s hunger most directly. These stresses push women into poorly paid informal sector work, competing among themselves for ever more inadequate earnings. Men also feel the effects: the food price rises severely undercut their capacities to provide for their families, leading to arguments in the household and fueling alcohol abuse and domestic violence. In the worst instances, couples split up or look for better-off partners to cope with the tough times.In one Bangladeshi village, some people were believed to be accumulating micro-credit loans simply in order to make their loan repayments; default rates were believed to have risen. Many people are spending less on personal items like clothes and cosmetics, and scaling down their social lives. Government safety nets have provided some support, but this has generally failed to protect people from the effects of the price rises. The result of these adjustments is not generally starvation, but an overall increased level of discontent and stress. Poor people are having an even more difficult time getting by; the anxieties of the daily grind have become even more arduous and attritional.The extent of people’s discontent with the situation becomes clearer when asked about their opinions on the causes of food price rises, and what should be done about them. From across the eight sites comes the sense that local food prices depend on harvests and environmental conditions in-country; there was a strong undercurrent of concern over scarcity from the way people spoke about population pressures and shrinking agricultural farmland in some places. Few people think international food prices are an important cause; some even dismiss such factors as merely convenient excuses made by their ineffective governments. But while governments are held responsible for acting to protect their people from price spikes, they are generally seen as having failed to do so effectively. There is a belief that governments can act to keep prices low if they want to; in Zambia, for instance, some people credited the imminent elections with putting political pressure on the government to keep staple prices low.Poor people’s explanations of why governments have generally failed to act on food price rises revolve around two key perceptions: that governments do not care about poor people’s concerns; and that corruption at different levels of the system ensures that prices cannot be controlled, either because market inspectors can be bought off, national politicians owe big businessmen favours for help with election expenses, or cartels are permitted to operate.Most people do not think that lack of knowledge of the situation is the main problem, but there is also a strong sense that closer monitoring and having a more effective voice – through demonstrations and protests as well as through research of this kind – could help raise their concerns.Young urban men appear particularly angry about government failures to act. With ongoing revolutions in the Middle East and other protests against governments in Europe, the stress and discontent fueled by high food prices merits close attention.

Consumer market for functional foods in South Brazil.

Abstract: This study aims at investigating the consumer market for functional foods (FF) in Porto Alegre, South Brazil. Functional food is any healthy food claimed to have a health-promoting or disease-preventing property beyond the basic function of supplying nutrients. Health has been named as the most significant trend and innovation driver in the global food and drinks market. Brazil is one of the leading countries in food production and consumption, and the market for functional foods have been growing 10% per year, three times more than the market for conventional foods. Although this food category is considered mature in some developed markets (such as in Japan, in the Nordic countries and in the U.S), it is still unknown for many consumers, especially those located in developing countries. On the other hand, functional foods has been attracting the attention of multinationals and local food industries in Brazil, since innovation can significantly impact on their competitive advantages. Therefore, in this study, first we are going to identify the availability of functional food products in the local retail market, through observation techniques. Our aim is to confront consumers’ needs with local food companies’ market supply. Secondly, we investigate consumers’ motivations, attitudes and intention to buy functional foods, since the market demands a better understanding of this trend. A survey with 450 consumers was conducted and provided quantitative insights. Results indicate that the market for functional foods in Rio Grande do Sul is incipient, but it is developing fast. There are few local functional food products in the market, but those are attractive to consumers and indicate promising opportunities. The survey shows that interviewed consumers presented positive attitudes towards functional foods and enough purchasing power to buy it. Dieticians, nutritionists and other health professionals have high credibility and could help inform consumers about the benefits of particular categories of functional foods. Food industry itself is not regarded as the most trustworthy source, what indicates the need of more attention to this fact from a corporate point of view. Finally, this study shows that the understanding of Brazilian consumers is fundamental to help food companies define their strategies. To map the most accepted categories of functional foods is also important, aiming to avoid the "tentative and error" approach.

The redistributive effects of monetary policy

Abstract: We introduce a model of the economy as a social network. Two agents are linked to the extent that they transact with each other. This generates well-defined topological notions of location, neighborhood and closeness. We investigate the implications of our model for monetary economics. When a central bank increases the money supply, it must inject the money somewhere in the economy. We demonstrate that the agent closest to the location where money is injected is better off, and the one furthest is worse off. In common parlance, it means that any increase in the money supply redistributes purchasing power from Main Street to the government and to Wall Street. Symmetrically, any decrease in the money supply redistributes purchasing power in the other direction. We also outline the testable implications of our model, and offer anecdotal evidence that it may help explain certain aspects of the 2008 subprime crisis.

Hyperinflation in Zimbabwe

Abstract: One hundred trillion dollars?that?s100,000,000,000,000?is the largest denomination of currency ever issued.1 The Zimbabwean government issued the Z$100 trillion bill in early 2009, among the last in a series of ever higher denominations distributed as inflation eroded purchasing power. When Zimbabwe attained independence in 1980, Z$2, Z$5, Z$10 and Z$20 denominations circulated, replaced three decades later by bills in the thousands and ultimately in the millions and trillions as the government sought to prop up a weakening economy amid spiraling inflation.

Beyond Transition Towards Inclusive Societies

Abstract: Received wisdom has favoured broad-stroke economic reforms for transition Europe and Central Asia since the fall of the Berlin Wall. Many have argued that privatization and deregulation would unleash the productive energy of the market and attract foreign capital. This advice was seen to bear fruit. Following the transition recession of the early 1990s, and especially after the crisis of 1998, the region saw a decade of broad-based and uninterrupted recovery. Livelihoods improved, and poverty declined on average in every country. This report builds on evidence that, despite these gains, a significant number of people in transition Europe and Central Asia continue to feel dejected, and believe that their position in society has declined. While some of these feelings may be rooted in the uncertainty that has accompanied market relations and greater freedoms, something more fundamental is at play. Even in the decade of recovery and growth, inequalities continued to widen— especially between central and peripheral regions. The recovery failed to lift significant segments of the population out of poverty. Many people fell further behind. Fundamental to this analysis is the concept of social exclusion. This report links the social exclusion/inclusion paradigm, as developed in the European Union context, with the human development paradigm, as articulated by Amartya Sen. It starts from the premise that people value not only consumable goods and services but also things that cannot be consumed—activities and abilities that reinforce human dignity and self-respect. For example, we value employment not only because the income derived increases our purchasing power, but also because it makes us feel like worthy members of society. Human development is about a growing number of people leading lives that they increasingly value

Investing in threatened species conservation: does corruption outweigh purchasing power?

Abstract: In many sectors, freedom in capital flow has allowed optimization of investment returns through choosing sites that provide the best value for money. These returns, however, can be compromised in countries where corruption is prevalent. We assessed where the best value for money might be obtained for investment in threatened species that occur at a single site, when taking into account corruption. We found that the influence of corruption on potential investment decisions was outweighed by the likely value for money in terms of pricing parity. Nevertheless global conservation is likely to get best returns in terms of threatened species security by investing in "honest" countries than in corrupt ones, particularly those with a high cost of living.

The Calculation of Rural Urban Food Price Differentials from Unit Values in Household Expenditure Surveys: A new procedure and comparison with existing methods 1

Abstract: While national and international statistical agencies spend much resource on calculating purchasing power parity (PPP) between countries, relatively little attention is given to PPP calculations within countries. Yet, for large and heterogeneous countries, such as the US and India, intra country PPP is as important as cross-country PPP. This is particularly true of the rural urban divide in such countries where the idea that one unit of currency has the same purchasing power in both sectors is clearly false. This paper addresses this limitation by proposing a demand system based methodology for calculating rural urban PPP that incorporates rural urban differences in preferences and applies it to India. The methodology is compared with conventional procedures, such as the Laspeyre’s price index and the CPD model, and shown to have several advantages over them. The result on significant rural urban price difference in India underlines the need to extend the crosscountry PPP calculations to incorporate spatial differences in large, heterogeneous countries with a diverse set of preferences and prices.

Irving Fisher: Debt Deflation and Crises

Abstract: It is the 100th anniversary of Irving Fisher’s 1911 book The Purchasing Power of Money. But, more important than that, it is a good time, during the current financial turmoil, to reconsider some of his theories again, in light of current events. And I think that some of his theories about variations in the purchasing power of money are very important today, have been underappreciated, and are worthy of considering anew.

Oil Price Shocks: A Comparative Study on the Impacts in Purchasing Power in Pakistan

Abstract: The current research investigates the relationship between changes in crude oil prices and Pakistan and the macro-economy. A multivariate VAR analysis is carried out among five key macroeconomic variables: real gross domestic product, short term interest rate, real effective exchange rates, long term interest rate and money supply. From the VAR model, the impulse response functions reveal that oil price movements cause significant reduction in aggregate output and increase real exchange rate. The variance decomposition shows that crude oil prices significantly contribute to the variability of real exchange rate long term interest rate in the Pakistan economy while oil price shocks are found to have significant effects on money supply and short term interest rate in the economy. Despite these macro econometric results, caution must be exercised in formulating energy policies since future effects of upcomming oil shocks will not be the same as what happened in the past. Explorations and development of practicable alternatives to imported fuel energy will cushion the economy from the repercussions of oil shocks. Oil price shock has negative impact on the GDP and as well as economy of Pakistan.

Breaking even or breaking through : reaching financial sustainability while providing high quality standards in higher education in the Middle East and North Africa

Abstract: Higher education (HE) systems worldwide are faced with three main challenges: providing young people with the skills required by the job market; improving access to high quality services; and seeking out new sources of financing to cope with the growing student demand This document will provide evidence on the need to seek sustainable financing strategies for countries in Middle East and North Africa (MENA), whether they are high income economies, such as the oil producing countries, or low to middle income economies Chapter one presents an overall description of HE graduates and the many challenges they face in their transition into the workforce The different elements that affect this transition are discussed and special attention is given to the mismatches between labor supply and demand Chapter two analyses the current levels of spending on HE, projects the future financing gaps taking into account the need to continue expanding access and improving quality and relevance, and provides a framework for funding approaches linked to meeting access, equity, and quality goals Chapter three outlines ways of using current funds in more effective ways, emphasizing the need to align financing allocations with policy goals Innovative funding allocations that link funding to performance and demand- as well as supply-side mechanisms are discussed Chapter four discusses different ways to diversify sources of funding and presents alternative methods of cost-sharing The chapter emphasizes the equity measures needed for cost-sharing mechanisms, such as student fees, and provides an overview of student loan programs used in MENA and elsewhere Chapter five discusses the role of private provision of HE, and how this can be an alternative to increase access and quality, provided the necessary regulatory and quality controls are in place Chapter six describes an alternative source of funding not yet common in MENA, namely the use of philanthropic resources to build endowments to support HE

Precision Targeting: The Economics - and Politics - of Improving Canada’s Inflation-Targeting Framework

Abstract: The Bank of Canada’s inflation-targeting framework, since its inception in 1991, has proven itself a success. Yet further improvements in the system should be considered seriously for inclusion in a renewed monetary policy agreement, between the Bank of Canada and the federal government, and renewal is due in 2011. Some improvements would deliver genuine economic benefits to millions of Canadians over the years ahead. Lowering the target rate for consumer price inflation in particular would help secure the domestic purchasing power of our financial assets. Such a change, however, should be part of a coherent framework, which addresses financial stability goals and political imperatives.

The Future of Retirement and the Pension System: How the Public's Expectations Vary Over Time and Across Socio-Economic Groups

Abstract: We analyze expectations of the Dutch population of ages 25 and older concerning the future generosity state and occupational pensions, the two main pillars of the Dutch pension system. Since the summer of 2006, monthly survey data were collected on the expectations of Dutch households concerning purchasing power of occupational pensions, eligibility and purchasing power of old age social security benefits, and the average retirement age ten or twenty years from now. We investigate how these expectations have changed over time and how they vary with socio-economic characteristics. Exploiting the fact that we have data until September 2010, we also analyze the effect of the recent financial and economic crisis. We find significant differences in expectations of different socio-economic groups, mainly suggesting that groups who are probably better informed were also more pessimistic.

System and method for providing a pre-paid commodity-based credit account

Abstract: This invention relates to a system and method that provides a pre-paid credit account, where the value of the account is based on the market price of an underlying commodity instrument. More specifically, this invention relates to a system and method for managing cash assets in the form of gold bullion that is maintained by a financial institution on behalf of an account holder, thereby allowing the account holder to utilize the purchasing power of the gold bullion assets in a convenient fashion.

Cross‐countries analysis of rising food prices: policy responses and implications on emerging markets

Abstract: Purpose – The purpose of this study is to create an opportunity to see what is wrong with agriculture and provide an opportunity for much needed change. It identified who benefits or bears the pains of food prices increase, examines the causes and effects of the increase and discusses policy responses by various countries and the implications of such interventions.Design/methodology/approach – Secondary data were employed and analyzed through simple descriptive statistics.Findings – The results of the findings showed that increase in food prices affects the nutrition of not only the poor but also the working and middle classes. It limits the food consumption of the poor and worsens the dietary quality. It revealed that foods are available in many countries but millions of people have no purchasing power. Some of the driving forces of price increase include expansion of biofuels, high demand for food, and high cost of food production, climate change, unfavorable government policy and underinvestment in agr...

Is it in the interest of the consumer to pay taxes? Transatlantic differences in postwar approaches to public consumption

Abstract: This article is a comparative analysis of American and West German consumer policy and its underlying definition of the consumer interest during the decades following the Second World War. It traces diverging government responses to a transatlantic debate among economists, policy makers and a wider public over the proper balance between private and public consumption. Whereas postwar America put an emphasis on unrestrained private purchasing power and limited public spending, West German policy makers were more likely to include the provision of publicly supported and tax-funded goods and services as part of their definition of the consumer's interest. This contributed, the article proposes, to a fundamentally different perspective on government spending and taxation by middle-class consumers in both countries. Drawing on media sources, contemporary scholarly literature and government documents, I want to elaborate on our understanding of what counted as ‘consumption’ and ‘consumer goods’ and thereby enco...

Do spatial price indices reshuffle the Italian income distribution

Abstract: This paper examines how spatial price differentials affect income distribution in Italy. Established results concerning disparities between the Northern and Southern regions of Italy hold up when adjusting incomes for the regional purchasing power. Poverty is still concentrated in the Southern part of the country. Furthermore, the cost-of-living indices that have the highest impact on the Italian income distribution are those accounting for regional differential in housing prices.

Comparing Microfinance Models: MC2 Model versus Other Microfinance Model

Abstract: This study analyzes various microfinance models in the wake of the current crises in Bangladesh and India. It presents a critical analysis of the Grameen Bank model, the MC2 model, the village banking model, and the SKS-microfinance model. It concludes that the MC2 microfinance model is superior to other models due to its strong community identity feature. MC2 are rural development micro-banks created and managed by a community in keeping to their local values and customs.The paper states that models like SKS, Grameen bank and the village banking mode are market based and investor driven. They force the poor into inflexible contracts with high interest rates. The paper advocates the MC2 model, because MC2: Is created, owned, controlled and managed by people in keeping with local values, traditions, customs and reality; Has practical interest rates that conform to the low purchasing power of its target population; Has a unique four pillar approach that links the expertise of a commercial bank, an international NGO, local populations and national and international partners; Uses a five stages development setup that emphasizes savings and self-sufficiency.