IMF-Supported Programs and Income Convergence in Low-Income Countries (WORKING PAPER)
Continuing the empirical debate on the effects of IMF-supported programs on participating countries’ macroeconomic performance, we focus on the issue of whether these programs accelerate conditional ß-convergence among low-income countries (LICs). We use an unbalanced panel dataset for 85 LICs over the period 1986-2015 and employ two different econometric methods to address the selection bias problem. Our empirical results suggest that the rate of conditional income per capita convergence is faster among LICs with extended IMF support than that in countries without support or with intermittent support.
Despite a temporary reprieve, the Social Security Disability Insurance program needs structural reform (POLICY COLUMN)
The Social Security disability program needs structural reform. There has been a long-term trend toward higher rates of disability among covered workers as the standards for assessing disability have accommodated larger numbers of applicants with musculoskeletal and mental health conditions. Congress should pass legislation soon to test far-reaching changes in the program, including providing temporary health and income support benefits to some applicants who might be able to return to work with proper medical care and job-placement assistance and experience-rating the payroll tax for employers to encourage them to take steps to prevent elevated rates of disability among their workers.
SOCIAL SECURITY'S INTERGENERATIONAL CONUNDRUM (POLICY Column)
Even as Social Security has become an indispensable source of financial wellbeing and security for the retired population in the United States, it has also become financially unsustainable in its current form. This article explains Social Security’s intergenerational conundrum using a simple, stylized example of the average wage earner to calculate the net real rate of return (NRR) on lifetime payroll tax contributions for an average working male under the Old Age, Survivors and Disability Insurance (OASDI) program. The program is unsustainable in its current form, but it is too late to implement changes that will be fair across generations. While insolvency is not imminent, Congress must act sooner rather than later to give these workers time to make the necessary adjustments in their retirement plans.
Long Term Socio-economic Consequences of Local Birth-Year Rainfall (REVISE AND RESUBMIT)
Epidemiological literature suggests that in utero and extrauterine environment has important implications for development of infants into adulthood. To test this hypothesis, this paper studies the persistent impact of early-life weather conditions on adult socioeconomic outcomes. I find that rainfall shocks in and around the year of birth have not only exposed children in Nepal to poor nutrition, but also have reduced their future productivity and earnings from education. This has important policy implications regarding targeted agricultural insurance and safety net programs.