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Are Budget Neutral Income Floors Fiscally Viable in Sub-Saharan Africa?

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  • Nora Lustig
  • Jon Jellema
  • Valentina Martinez Pabon

Abstract

We use microsimulations to assess whether budget-neutral universal income floors are fiscally viable in twelve Sub-Saharan African countries. We consider three universal basic income scenarios of decreasing levels of generosity: poverty line, average poverty gap and current spending on transfers and subsidies per person. The first two may not be viable because the required increase in taxes to fulfil budget neutrality is significant.

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  • Nora Lustig & Jon Jellema & Valentina Martinez Pabon, 2023. "Are Budget Neutral Income Floors Fiscally Viable in Sub-Saharan Africa?," Journal of African Economies, Centre for the Study of African Economies, vol. 32(Supplemen), pages 202-227.
    • Handle: RePEc:oup:jafrec:v:32:y:2023:i:supplement_2:p:ii202-ii227.
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    Cited by:

    1. Habeenzu, Lennon Jambo, 2023. "Determinants of Inclusive Growth in Zambia," African Journal of Economic Review, African Journal of Economic Review, vol. 12(1), March.
    2. Nora Lustig & Valentina Martinez Pabon, 2022. "Universal Basic Income, Taxes, and the Poor," Working Papers 2205, Tulane University, Department of Economics.
    3. Hernandez, Carlos Ospino & Rigolini, Jamele & Coll-Black, Sarah & Oviedo, Ana Maria, 2023. "Protecting Who? Optimal Social Protection Responses to Shocks with Limited Information," IZA Policy Papers 205, Institute of Labor Economics (IZA).

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    More about this item

    Keywords

    Sub-Saharan Africa; taxes; fiscal impoverishment; poverty; fiscal policy; universal basic incomesJEL Codes: H22; I38; D31;
    All these keywords.

    JEL classification:

    • H22 - Public Economics - - Taxation, Subsidies, and Revenue - - - Incidence
    • I38 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Government Programs; Provision and Effects of Welfare Programs
    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution

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