Nora Lustig receives the Schloss Prize for Economics

“The prize is awarded to professors or students who show outstanding work in the Department of Economics. This year the department’s selection committee voted unanimously for Lustig. ‘The Schloss Prize is allowing me to spend time in Argentina to complete a study on fiscal policy and income redistribution, and will allow me to spend time in the Paris School of Economics next spring to work with professor Francois Bourguignon, one of the leading scholars on inequality research worldwide,’ she said.” Click here to read the announcement.

A missing target in the SDGs: Tax systems should not reduce the income of the poor

A new blog post on the International Growth Center‘s website outlines why the Sustainable Development Goals needs to take what the net effect of all governments taxing and spending has on the poor. In many cases, the poor are left worse off by tax and transfer programs. “As it stands, the SDGs list of targets would not alert us of such a perverse outcome. Under Goal One on poverty reduction, there should be a Target 1.6: “By 2020 to ensure that the tax system does not reduce the income of the poor.”

Read the full post here

In Focus: World Economic Forum

The World Economic Forum is an institution that provides a unique environment for politicians, business leaders, academics and others to exchange ideas to improve the state of the world. This week, Olli Rehn, VP of the European Parliament, posted an article addressing three key questions for public finance:

– What kind of policy mix of monetary policy, fiscal policy and structural reforms can support stronger and more sustainable growth?

– How do we protect budget lines that support growth in the medium-to-long-term, such as public investment to modern infrastructure and competitive innovation, while maintaining a decent level of social protection?

– How to ensure the adequacy and sustainability of social protection systems while making them more supportive to growth?

Read the article here

Announcing Publication of CEQ Guatemala Paper

Commitment to Equity’s 20th Working Paper “Fiscal Policy, Inequality, and the Ethnic Divide in Guatemala” is now available to download on Written by Maynor Cabrera (Fedes), Nora Lustig (Tulane University), and Hilcías E. Morán (Bank of Guatemala), the paper uses fiscal incidence analysis to show that takes and transfers do almost nothing to reduce inequality and poverty in Guatemala, one of the most unequal countries in Latin America.

Presentation at the Universidad Nacional Autónoma de México

This past Tuesday, September 2nd, Prof. Nora Lustig gave a presentation on the Impact of Fiscal Policy on Inequality and Poverty in Developing Countries. This presentation was part of an ongoing Seminar series at UNAM that focuses on “la cuestión Social”, the theme this week was “Política fiscal, equidad y transparencia”. Prof. Lustig presented recent finding of the Commitment to Equity initiative, with a particular focus on Latin American countries. Click here for a pdf (in spanish) of the presentation.

CEQ partners with the Center for Global Development

We are pleased to announce a new Commitment to Equity (CEQ)partnership with the Center for Global Development (CGD). CGD works to reduce global poverty and inequality through rigorous research and active engagement with the policy community to make the world a more prosperous, just, and safe place for us all. CGD’s role as a partner of CEQ will be to share the global reach of their communications platform. Through a new Commitment to Equity sub-topic within their inequality topic, they will post links to CEQ studies as they become available, the CEQ papers that are jointly published with CGD, and occasional blog posts. We look forward to working with CGD and are honored to have it as a CEQ partner.

New CGD Partnership: Commitment to Equity Assessments of Impact of Fiscal Policy

Announcing a new CGD partnership with CGD non-resident fellow Nora Lustig’s brainchild called the Commitment to Equity (CEQ) project. Launched as a joint initiative of the Inter-American Dialogue and Tulane University in 2008, the CEQ consists of a network of economists who are undertaking detailed, data-rich analyses of the impact of taxation and social spending on inequality and poverty in more than 20 countries around the world, including Brazil, China, India, Indonesia, Mexico, South Africa and the United States. CEQ analyses provide the information that governments, multilateral institutions, and civil society need to quantify the fiscal impact of tax and transfers systems on different income groups in the population—crucialinformation in their efforts to build more equitable societies.

Studies by Nora and her CEQ colleagues show that analyzing taxes and transfers jointly is necessary to understand who pays and who benefits from different tax and transfer systems. One startling finding: in many countries it is not just the middle class and the rich who pay more in taxes than they receive in cash, pension and other social insurance transfers; a group that can be legitimately called the ”new poor” or strugglers are also net contributorsgovernment finances.

The CEQ works in partnership with research institutions and the Inter-American Development Bank, the World Bank, and the International Fund for Agricultural Development, and is currently undertaking studies in Ghana and Tanzania with the support of the Gates Foundation. CGD’s role as a partner will be to share the global reach of its communications platform.

Publication of CEQ Working Paper #16: Comparing the Incidence of Taxes and Social Spending in Brazil and the United States

Announcing the publication of the 16th working paper of the Commitment to Equity Project, by Sean Higgins, Nora Lustig, Whitney Ruble and Timothy Smeeding. Click here to view!


We perform the first comprehensive fiscal incidence analyses in Brazil and the US, including direct cash and food transfers, targeted housing and heating subsidies, public spending on education and health, and personal income, payroll, corporate income, property, and expenditure taxes. In both countries, primary spending is close to 40 percent of GDP. The US achieves higher redistribution through direct taxes and transfers, primarily due to underutilization of the personal income tax in Brazil and the fact that Brazil’s highly progressive cash and food transfer programs are small while larger transfer programs are less progressive. However, when health and non-tertiary education spending are added to income using the government cost approach, the two countries achieve similar levels of redistribution. This result may be a reflection of better-off households in Brazil opting out of public services due to quality concerns rather than a result of government effort to make spending more equitable.

Revised CEQ Handbook is Now Available

This handbook presents a step-by-step guide to applying the incidence analysis used in the multi-country Commitment to Equity project (CEQ). We define the pre- and post-net transfers income
concepts, discuss the methodological assumptions used to construct them, explain how taxes,
subsidies and transfers should be allocated at the household level, and suggestwhat to do when the
information on taxes and transfers is not included in the household survey. We also describe the
indicators that are used to assess the distributive impact, progressivity and effectiveness of social
spending, subsidies and taxes.In addition, we present sample Stata code for producing some of the
indicators. (For more on CEQ visit


Current History presents a new e-book

Inequality on the Rise: A Current History Anthology
Inequality is stirring controversy in developing and advanced economies alike. Perceptions of unfair disparities in incomes and opportunities can undermine the legitimacy of both authoritarian and democratic governments. Yet the problem is more complex than many on the right or left care to admit. Once it reaches certain levels, income inequality impedes economic growth; at other times it seems an unavoidable trade-off in the pursuit of growth. Finding the proper balance is more than a question of economic theory; it’s a moral and political dilemma.

The eight essays collected in this e-book appeared in Current History from 2012 to 2013 in a monthly series on inequality around the world. Together they form a useful guide to the topic that benefits from Current History’s region-by-region approach. Contributors include Uri Dadush and Kemal Derviş, who provide a global overview; Martin King Whyte on China; Daniel Treisman on Russia; Ahmed Galal on the Middle East; Nora Lustig on Latin America; Jason Beckfield on Europe; Roberto Zagha on India; and Luc Christiaensen and Shantayanan Devarajan on Africa. As their essays show, each of the world’s regions has struggled with the economics and politics of income distribution. Yet, as Dadush and Derviş note, “There is no secret to the recipes that governments can use to mitigate inequality.” The key ingredient may be political will.

The BRICS Summit in Durban, South Africa: March 26th – 27th 2013

1. With the theme of ” BRICS and Africa -partnerships for integration and industrialisation” the BRICS Summit will spend a whole day in interaction with NEPAD on African development and BRICS support for African regional integration.

2. A BRICS Bank will be launched, agreed in some detail apparently. Capital will be equal shares of $10bn, much less than original proposal, thus avoiding complex negotiations. South Africa is offering to host it, still under negotiation, which again may avoid complex negotiations on location and recognise Johannesburg as a world class financial market capable of managing international bond issues for the BRICS Bank. The original concept was advanced by India last year, as a direct challenge to the World Bank, and although that dimension has been toned down it is still there. Some people here in South Africa do not see that Africa needs another development bank. Nevertheless the existence of a BRICS Bank will no doubt send a important signal about the role of the BRICS Summit process as a part of the emerging global governance system, and it will give the BRICS clout as highly sought-after co-financers.

3. A currency swap safety net of $240 bn will be concluded, reducing the need for IMF credit lines.

4. A BRICS Business Council with 5 members from each country will be established, developing sectoral programmes and events, including agriculture, to work alongside the BRICS Bank

5. A BRICS Think Tank system was put in place last week at an academic forum in Durban, with the dedicated think tanks from each country signing a joint declaration.

6.The BRICS Trade Union Forum is to be established as a permanent organisation. President Zuma will give the opening address tonight (Saturday 23 March).

7. NEPAD and Oxfam are jointly orgainising a Public Policy Forum ahead of the Summit on Monday 25 March, under the auspices of the African Platform for Development Effectiveness (the African Busan Platform).

8..A CSO “BRICS from Below” counter summit has been formed, positioning itself as a watchdog, which will operate during the next week.

“Commitment to Equity” website is launched

Visit and learn about how taxation and social spending impact inequality and poverty in Latin America.
The Commitment to Equity (CEQ) is a joint project of CIPR and the Department of Economics at Tulane University and the Inter-American Dialogue in Washington, DC. Directed by Nora Lustig and Peter Hakim, the CEQ uses tax and benefit incidence analysis to assess the impact of fiscal policy on inequality, poverty and access to social services. The Commitment to Equity Assessments presented here will prove a useful source for scholars and students. They can also provide a roadmap for governments, multilateral institutions, and nongovernmental organizations in their efforts to build more equitable societies.

Latin America’s Surging Middle Classes: Are they Really a Force for Change?

On Wednesday, November 14th the Center for Global Development will host an event focused on the rise of the Latin American Middle Class.

Event Summary: Latin America’s emerging middle class, defined as those unlikely to fall back into poverty, has grown by 50% in recent years and now includes one of every three people on the continent, roughly equal to the number of people who remain poor. A new World Bank study finds many potential benefits from this surging middle class but cautions that these benefits can only be fully realized if countries can strike a new social contract that links middle class interests to the inclusion of those left behind. The event will include presentation of the report’s key findings and a panel discussion with some of the leading experts on the region’s middle classes.

Click here for a link to the Event page!