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Comparing the poverty-reduction efficiency of targeted versus universal benefits amid crises

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  • Adnan Abdulaziz Shahir
  • Ravi Kanbur
  • Jukka Pirttilä
  • Pia Rattenhuber

Abstract

This study evaluates which type of benefit—a universal benefit, a proxy mean-tested benefit, or a categorical benefit— better cushions the poverty effects of income shocks in a developing economy. We compare the effectiveness of the three benefit schemes on poverty first conceptually and then by considering two different crisis scenarios, the COVID-19 pandemic and a hypothetical agricultural shock, in a tax-benefit microsimulation model for Ethiopia.

Suggested Citation

  • Adnan Abdulaziz Shahir & Ravi Kanbur & Jukka Pirttilä & Pia Rattenhuber, 2023. "Comparing the poverty-reduction efficiency of targeted versus universal benefits amid crises," WIDER Working Paper Series wp-2023-100, World Institute for Development Economic Research (UNU-WIDER).
    • Handle: RePEc:unu:wpaper:wp-2023-100
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    References listed on IDEAS

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    1. Dolls, Mathias & Fuest, Clemens & Peichl, Andreas, 2012. "Automatic stabilizers and economic crisis: US vs. Europe," Journal of Public Economics, Elsevier, vol. 96(3), pages 279-294.
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    1. Enrico Nichelatti & Maria Jouste & Pia Rattenhuber, 2024. "The potential of universal basic income schemes to mitigate shocks: Comparing the performance of universal basic income in Uganda and Zambia during COVID-19," WIDER Working Paper Series wp-2024-21, World Institute for Development Economic Research (UNU-WIDER).

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