REAL Seminar Series
Friday, Novemer 6, 2020
9-10 a.m. CST
Join Zoom Meeting by clicking here
Meeting ID: 997 1523 2314
Passcode: 923169
André Chagas
Professor, University of Sao Paulo, Brazil
Achagas@usp.br
"Neighborhood Effects in Disaggregated Consumption: Evidence from Brazil"
This paper investigates neighborhood effects in the composition of household expenditure using disaggregated consumption data of households from the city of São Paulo, Brazil, surveyed between 2008 and 2013. Data about the exact addresses of all households were available and used to more precisely define household’s reference groups characterized by geographical proximity. We develop and estimate a spatial simultaneous demand model at different levels of product aggregation. Our results provide evidence for statistically significant neighborhood effects in all levels of aggregation. Furthermore, we present price and income elasticities by direct, indirect, and total impacts. This study is unique for the Brazilian case and contributes to the understanding of social effects in consumption for less developed countries. Our results may also be relevant to improve the precision of policies related to consumption such as income transfer programs and tax policies.
and
Alícia Chávez
Ph.D. Student, Catholic University of the North, Chile
"Public Spending and Economies of Scale in Partial Fiscal Decentralized Governments: The Case of Chile"
Economies of scale derived from over-urbanization could affect the average cost of public spending in some cities and, as a consequence, undermine the equal provision of local public goods among municipalities. Those that reach economies of scale would be able to supply the basic required local public goods plus other additional benefits and opportunities, while those that do not achieve them would face problems to even provide the basic ones, causing an unequal supply between cities. This paper presents a framework for the assessment of economies of scale in local public spending in Chile, a developing country with a partial fiscal decentralized government. Using a 10-year panel data, we estimate the population level in which a reduction in the average cost of provision of local public goods occurs. To do this, we follow a theoretical model of cost efficiency that takes into account spatial interactions and spillover effects among neighboring jurisdictions. Our preliminary results confirm that there is a ‘U’-shaped relationship between population size and the costs of providing public services, suggesting the presence of economies of scale, which are reached around 700,000 inhabitants.
