Northwestern Events Calendar

Nov
14
2024

Development Economics Lunch Seminar

When: Thursday, November 14, 2024
12:15 PM - 1:15 PM CT

Where: Kellogg Global Hub, L120, 2211 Campus Drive, Evanston, IL 60208 map it

Audience: Faculty/Staff - Post Docs/Docs - Graduate Students

Contact: Maggie Hendrix   (847) 467-7263

Group: Department of Economics: Development Economics Lunch Seminar

Category: Academic

Description:

Speaker: Johanna Rayl 

Title: Redistribution with Limited Information: Fuel Subsidies and Cash Transfers in Indonesia

Abstract: I study optimal design of cash and in-kind redistribution in a setting with limited information: cash transfers and fuel subsidies in Indonesia. In 2005, the government shifted spending away from a costly and regressive consumer fossil fuel subsidy and towards a targeted cash transfer program. Cash transfers are a gold standard for redistribution, but their effectiveness is constrained by the information set available for targeting, potentially generating opportunities for second-best targeting using in-kind mechanisms. I ask how an optimal combination of cash and in-kind (subsidy) transfers could improve redistributional outcomes. Fuel subsidies may allow for additional targeting if the self-selection generated by consumption choices helps to overcome the information friction. I model fuel demand, fuel supply, and solve for the optimal policy given a limited government information set.

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