Investment Rating - The report does not explicitly provide an investment rating for the industry. Core Insights - The study assesses tax compliance and underreporting of labor income in Romania, particularly among minimum wage workers, highlighting the links between tax compliance and minimum wage policy [3][7][12] - The average underreporting of income in Romania is estimated at 6%, with significant underreporting observed in the lower half of the income distribution [3][46] - Tax compliance varies across different sectors, regions, and demographic groups, with transport, construction, and food and accommodation sectors showing the lowest compliance rates [3][12] - Women exhibit higher tax compliance compared to men [3] - The underreporting of income negatively impacts the fiscal capacity of the country and the effectiveness of means-tested social assistance programs [3][12] Summary by Sections Introduction - The report aims to evaluate tax compliance and underreporting of income in Romania, focusing on minimum wage earners and the implications for tax policy and equity [7][8] Methodology and Data - The study employs statistical matching techniques to compare tax returns with survey data, utilizing administrative tax records and EU-SILC data to assess tax compliance [16][21][30] - The analysis includes a comprehensive review of various methods to estimate tax evasion, highlighting the challenges of data integration and the importance of accurate income reporting [16][17][21] Results - The findings indicate that tax-reported income at the median is only 90% of the true income, with significant discrepancies noted at lower income percentiles [3][46] - The mean tax income is reported to be 1.2% lower than the mean survey income, while the imputed tax income is 6.6% higher than the mean survey income [43][44] - The report emphasizes the need for improved tax compliance mechanisms to enhance fiscal sustainability and social equity [10][12] Conclusion - The study concludes that addressing tax evasion is crucial for improving the effectiveness of the tax system and promoting greater income equality in Romania [10][12]

Investment Rating - The report does not explicitly provide an investment rating for the industry Core Insights - Fuel subsidies are generally inefficient and disproportionately benefit wealthier households, leading to significant socio-economic costs [10][11][38] - The removal of fuel subsidies can generate substantial fiscal savings but requires careful management to mitigate economic and social impacts [39][42] Summary by Sections Section 1: Global Oil Price Trends - World oil prices have shown significant volatility, with a fourfold increase from September 2003 to June 2008, followed by drastic drops and subsequent rises, peaking at US$114 per barrel in July 2022 [6] - The overall trend in 2023 fluctuated around US$80.5 per barrel, influenced by geopolitical events and economic cycles [6] Section 2: Impact of Rising Oil Prices - Rising oil prices negatively affect household living standards and increase production costs, particularly impacting the poorest households [7] - Fuel subsidies have increased globally, with total fossil fuel subsidies rising from 5.4% of GDP in 2015 to 7.1% in 2022 [8] Section 3: Inefficiency of Fuel Subsidies - Fuel subsidies are poorly targeted, benefiting richer households more than poorer ones, with the richest 20% gaining over six times the benefits compared to the poorest 20% [10] - These subsidies compromise fiscal sustainability and hinder growth-enhancing expenditures [11] Section 4: Strategies for Addressing Oil Price Rises - Gradual removal of fuel subsidies is recommended, coupled with alternative social programs to mitigate negative impacts on poor households [15][16] - Cash transfer programs targeting low-income households can effectively replace fuel subsidies, with simulations indicating a potential 86% reduction in negative effects from higher fuel prices [16] Section 5: Case Studies of Fuel Subsidy Reforms - Successful fuel subsidy reforms often include social measures to mitigate the impact on households, with examples from South Africa, Brazil, and the Philippines [20] - The experience of Angola highlights the importance of timing and sequencing in subsidy reforms, as well as the need for synchronized compensation measures [40] Section 6: Angola's Fuel Subsidy Context - Angola's fuel subsidies have been substantial, with fuel prices in 2011 being 67% lower than the Sub-Saharan Africa average [22] - The government has implemented a multiphase approach to fuel subsidy reform, with significant price increases in 2023 and 2024 aimed at gradually aligning prices with market levels [24][29] Section 7: Economic Impact of Subsidy Removal - The removal of subsidies is projected to result in a cumulative price increase of around 5.0%, with the highest impacts in the fisheries and transportation sectors [2][32] - Fully compensating for price increases in these sectors would absorb approximately 30% of the savings generated from subsidy removal [32][37]

Investment Rating - The report does not provide a specific investment rating for the industry Core Insights - The paper highlights the significant impact of domestic laws on government procurement, particularly focusing on protectionist measures that favor domestic suppliers over foreign competitors [2][9] - A novel dataset covering 141 countries reveals that 124 countries have preferential treatment provisions, indicating a widespread adoption of protectionist policies [2][11] - The analysis shows a negative correlation between protectionist procurement policies and trade openness, with countries exhibiting more protectionist laws trading more domestically than internationally [2][12] Summary by Sections Introduction - Government procurement accounts for 12% of global GDP as of 2019, with increased scrutiny on its allocation due to the COVID-19 pandemic and geopolitical crises [7] - Governments utilize procurement to achieve socioeconomic goals, which can lead to protectionist policies that limit foreign supplier participation [8] Literature Review - The literature indicates that protectionist rules in government procurement can significantly affect trade flows and economic efficiency [20][22] - Empirical studies have shown that countries with higher government spending tend to import less, suggesting the presence of protectionism [23] Data and Descriptive Evidence - A unique dataset was compiled to analyze procurement laws and trade data, focusing on discriminatory practices against foreign firms [28] - The analysis identifies three main types of protectionist measures: lack of equal treatment, preferential treatment for domestic bidders, and domestic sourcing requirements [30][31] Results on Trade Openness and Protectionism - Cross-country regression results indicate that countries with protectionist procurement laws have an import share in total spending that is 20% lower compared to less protectionist countries [45][48] - The negative correlation between protectionism and trade openness is particularly strong in the manufacturing and primary sectors [49][50] Gravity Model Estimations - Gravity model estimations confirm that protectionist measures in government procurement lead to a significant "border effect," where domestic purchases are substantially higher than international ones in more protectionist countries [54][57]

Investment Rating - The report does not provide a specific investment rating for the industry Core Insights - Improved household surveys significantly enhance the measurement of consumption, leading to higher reported living standards and a potential redefinition of national poverty lines, but often result in minimal changes to national poverty rates due to upward adjustments in these lines [2][10] - The international poverty line remains fixed, which can lead to dramatic decreases in international poverty rates when new surveys reveal increased consumption, necessitating caution in temporal comparisons of poverty rates [11][12] - The design of household surveys, including recall periods and the inclusion of various consumption categories, is critical for accurate poverty measurement and can lead to substantial increases in reported consumption [20] Summary by Sections Household Surveys and Poverty Measurement - Most countries utilize household surveys to assess poverty, focusing on consumption levels to determine poverty status [4] - The design of these surveys greatly influences the data collected, affecting the accuracy of poverty assessments [5] Impact of Improved Surveys - Enhanced survey methodologies have led to an average increase of 46% in real mean consumption across 12 countries, attributed to capturing previously overlooked consumption [6] - Following improvements in survey quality, national poverty lines in ten countries increased by an average of 50%, which often offsets the increase in measured consumption [7][10] International Poverty Line Dynamics - The international poverty line, fixed at US$2.15 per day, can show significant declines in poverty rates when new surveys report higher consumption levels, as seen in cases like Guinea-Bissau and China [11][12] - The report emphasizes the need for caution when comparing international poverty rates over time, as improvements in survey methodologies can exaggerate perceived declines in poverty [12][13] Recommendations for Future Surveys - Countries should implement high-quality household surveys to ensure comparability and accuracy in poverty estimates, which is essential for reliable cross-country comparisons [16][20] - Strategies to mitigate the impact of survey design changes on poverty comparisons include maintaining a smaller sample with the old questionnaire or using imputation models for consistent trend analysis [17][18]

Industry Overview - The report focuses on **Transit-Oriented Development (TOD)** in emerging cities, emphasizing the integration of land use and transport planning to create sustainable, walkable, and transit-friendly urban environments [17][18] - Emerging cities, which house 75% of the global urban population, are expected to grow significantly, particularly in Asia and Africa, adding 2.3 billion urban dwellers by 2050 [21][86] - Urban transport is a major contributor to greenhouse gas (GHG) emissions, with private vehicles being the least carbon-efficient mode of transport per passenger-kilometer [22][87] Core Findings - **Low-carbon mobility** is already prevalent in many developing cities, with high modal shares of walking, biking, and public transport, and low motorization rates compared to developed countries [25][90] - **Density** in developing cities is a key advantage, with many informal settlements exceeding 60,000 inhabitants per km², supporting public transport and active mobility [26][92] - Despite these advantages, many emerging cities face challenges such as **inefficient urban planning**, **scattered development patterns**, and **lack of integration between transport and land use policies**, leading to increased motorization and congestion [29][93] Theoretical Framework - The report uses a **3-Value Framework (3V)** to analyze TOD, focusing on **node value** (transit ridership), **place value** (urban quality and walkability), and **market potential value** (real estate development potential) [36][128] - **Urban economics** highlights the trade-off between travel costs and rent, with higher densities near transit hubs generating demand for public transport [33][108] - **Land Use Regulations (LUR)** play a critical role in shaping urban development, with zoning, floor area ratios (FAR), and parking policies influencing transit ridership and walkability [38][162] Sandbox Model Insights - A **sandbox model** was developed to simulate the impact of LUR on transit ridership, showing that **higher FAR** and **plot coverage ratios** increase public transport use, while **setback requirements** and **parking mandates** reduce it [40][42] - The model predicts that **transit-friendly LUR** throughout the city, not just near transit corridors, is essential for creating a compact, transit-oriented urban form [43][72] Recommendations for TOD - **Accessibility analyses** should be conducted to evaluate the impact of transport investments and urban form on mobility, particularly for vulnerable groups like women [68] - **Housing affordability** should be tracked through the ratio of median income to median housing prices, with LUR adjusted to allow for more housing supply [70] - **City-wide TOD strategies** should adopt LUR that maximize node, place, and market values, including high FAR, low setbacks, and mixed land uses, to promote transit-oriented development [75][77] Case Studies and Examples - **Japan's zoning system** allows mixed land uses and high FAR in all zones, promoting densification around transit stations and affordable housing [38][162] - **Barcelona's Superille (Super-Island)** concept demonstrates how transit-friendly LUR can improve public transport ridership and urban walkability [43][62] - **Curitiba and Bogota** are examples of cities that started with arterials and sidewalks, later upgrading to bus rapid transit systems as demand increased [62][64]

Investment Rating - The report does not explicitly provide an investment rating for the industry under review. Core Insights - Photovoltaic-powered groundwater pumping presents a transformative solution for water services in underserved areas of Sub-Saharan Africa, but without proper regulation, it risks overexploiting groundwater resources, threatening groundwater-dependent ecosystems (GDEs) [4][41] - The study indicates that 92% of Sub-Saharan Africa's GDEs are at risk of overexploitation if photovoltaic water pumping is implemented without adequate controls, particularly in Southern and Eastern Africa [4][41] - Regions like southern Nigeria and South Sudan are identified as priorities for potential photovoltaic water pumping system investments due to their higher groundwater development needs and lower risks to GDEs [4][41] Summary by Sections Introduction - Access to electricity and clean water are critical development priorities in Sub-Saharan Africa, where 600 million people lack electricity and 400 million lack safely managed drinking water [8] - The advancement of photovoltaic technologies has lowered costs, enabling potential expansion of solar pumping for irrigation [8] Data - The study utilizes various datasets, including global horizontal irradiance, static water level, aquifer transmissivity, groundwater storage, population density, and renewable groundwater resources to assess risks to GDEs [15][19] Methodology - The Analytic Hierarchy Process (AHP) is employed to evaluate the risk of overexploitation of GDEs due to uncontrolled access to groundwater through photovoltaic pumping [19][21] Results - The analysis reveals that 92% of GDEs are at risk of overexploitation, with significant risks identified in western South Africa, Namibia, Kenya, Niger, and Somalia [27][30] - The findings highlight the need for targeted investments and close monitoring in regions with high risks to GDEs, such as Namibia and South Africa, while prioritizing areas with high groundwater development needs and lower risks [31][41] Policy Implications - The report emphasizes the importance of sustainable groundwater management and the need for enforceable policies to protect GDEs from the adverse effects of photovoltaic water pumping [40][41] - It suggests that better mapping and monitoring of GDEs are essential for understanding their value and ensuring their protection [40][41] Conclusion - The study underscores the necessity for careful planning and regulation in the deployment of photovoltaic water pumping systems to mitigate risks to GDEs while addressing the urgent need for water access in Sub-Saharan Africa [41][42]

Investment Rating - The report does not explicitly provide an investment rating for the industry discussed Core Insights - The inclusion of usufruct rights in household wealth estimates significantly impacts wealth distribution, particularly benefiting younger households and reducing wealth concentration indices by approximately 1 percentage point [2][35] Summary by Sections 1. Introduction - Household wealth is a crucial indicator of economic well-being and stability, providing insights beyond income alone [8][9] - Wealth data is essential for assessing disparities in asset ownership and informing policy initiatives aimed at reducing inequality [9][10] 2. General Reflections on Use Rights - Traditional wealth estimates often overlook partial rights like usufruct, leading to a distorted understanding of wealth distribution [11][12] - Usufruct allows individuals to use and enjoy property owned by others, which should be included in wealth assessments [14][15] 3. The Data - The report utilizes data from the Bank of Italy's Survey of Household Income and Wealth (SHIW), which has been conducted since the 1960s [18] - The share of households living in usufruct is relatively stable, averaging around 3 percent over the years [20] 4. Taking Account of Use Rights in Italy - Adjusting wealth estimates to include usufruct rights leads to an increase in net wealth values, particularly for younger households [28] - The Gini index shows a reduction in wealth concentration, indicating a more equitable distribution of wealth [29][30] 5. Free Residential Houses in HFCS Data - The report highlights the prevalence of free residential houses in various countries, with implications for wealth inequality [31][32] 6. Conclusions - The findings emphasize the importance of including usufruct in wealth estimates, as it significantly affects wealth distribution and concentration indices [35][36] - The analysis suggests that similar studies in countries with more widespread use rights could yield even greater impacts on wealth estimates [37]

Investment Rating - The report indicates a strong positive impact of personal initiative training on entrepreneurial success, suggesting a favorable investment outlook for programs that incorporate such training methodologies [10][48]. Core Insights - Personal initiative training in Togo resulted in an average increase of $91 in monthly profits after seven years, which is a 52% increase over the control mean [10][33]. - The training had a lasting impact on men, with their profits increasing by $148 after seven years, while the impact for women diminished to $39, indicating a significant gender disparity in long-term outcomes [11][35]. - The study highlights that traditional business training did not yield statistically significant long-term impacts, contrasting sharply with the sustained benefits of personal initiative training [10][48]. Summary by Sections Introduction - The report discusses the importance of evaluating the long-term impacts of business training programs, particularly in developing countries, where short-term evaluations are common [7][8]. Experimental Design and Personal Initiative Training - The study involved 1,500 small business entrepreneurs in Togo, with a focus on those operating outside agriculture and not formally registered [12][13]. - The personal initiative training program aimed to foster a proactive entrepreneurial mindset, contrasting with traditional business training that focused on standard business practices [17][18]. Long-Term Follow-up Impacts - The survival rate of businesses was high, with 88% in the control group and 91% in the personal initiative training group still operational after seven years [30][31]. - The report shows that the personal initiative training group experienced significant increases in profits and sales, with a cumulative gain of over $6,900 over 7.5 years, representing a return of over 900% on the training cost [33][48]. Gender Heterogeneity in Treatment Impacts - Initial impacts of personal initiative training were similar for both men and women, but long-term effects diverged significantly, with men experiencing sustained growth while women's profits converged back towards the control group [34][41]. - The report suggests that women may face industry-specific constraints and redirect their entrepreneurial efforts towards household needs, limiting their long-term business growth [42][47]. Discussion and Conclusions - The findings indicate that personal initiative training is particularly effective for men, suggesting a need for complementary interventions for women to enhance their long-term business outcomes [49].

Industry Overview - Minimum wages are a critical component of social protection systems, aiming to protect vulnerable workers and reduce poverty and wage inequality, but poor design can lead to risks such as reduced job opportunities for low-skilled and young workers [2] - Romania has experienced significant real growth in minimum wages over the past decade, with the minimum-to-median wage ratio increasing from 38% in 2007 to 60% in 2017, placing it among the top EU countries in this metric [15] - The minimum wage in Romania is higher than the living wage needed to cover a basic food basket but insufficient to include non-food components, which could lead to long-term job losses, especially for younger workers [2] Labor Market Dynamics - The minimum wage increase in Romania has varying impacts across regions and sectors, with the accommodation and food services sector and the Suceava region being the most affected due to the high proportion of minimum wage earners [2] - Male employees are more affected by minimum wage increases than female employees, and younger workers face higher risks of job loss [2] - The share of minimum wage earners in Romania is consistently high, ranging from 24% to 28% between 2020 and 2021, with 2% of employees earning below the minimum wage threshold [84] Sectoral Impact - The construction sector has the highest proportion of minimum wage earners at 54.6%, followed by accommodation and food services at over 50%, while sectors like electricity, gas, and steam have less than 2% of employees earning minimum wages [91][92] - Microenterprises have the highest proportion of minimum wage earners at 67%, while large enterprises have only 6% of employees earning minimum wages, reflecting the trend that average wages increase with firm size [93][94] Policy Implications - Linking the minimum wage to inflation could result in moderate employment losses, particularly in the long term, with younger workers experiencing the most significant adverse effects [109] - Aligning the minimum wage with a living wage estimate could lead to substantial short-term wage increases but may also cause notable job losses, especially among low-wage and younger workers [118] - The minimum wage increase has a more substantial positive impact on income inequality when aligned with a living wage estimate, with the Gini index decreasing from 0.356 to 0.344 and the bottom 50% income share increasing by 0.7 percentage points [123] Demographic and Regional Variations - The youngest and oldest age groups are most affected by minimum wage increases, with 43% of workers born in 2001 earning minimum wages compared to 27% of those born in 1994 [95] - Regional disparities are significant, with Suceava county having the highest proportion of minimum wage earners at 38%, nearly double that of Sibiu county at 21% [96]

Investment Rating - The report does not explicitly provide an investment rating for the industry. Core Insights - Timor-Leste's economy grew by 2.3 percent in 2023, following growth rates of 2.9 percent in 2021 and 4.0 percent in 2022, reflecting fiscal drag and low budget execution rates due to political transitions [24][40] - The reliance on public sector-driven economic activity has led to stagnant labor market dynamics, with a notable decline in labor productivity and wage levels, particularly among those with higher education [48][50] - The strengthening US dollar has eased price pressures, but food inflation remains high, particularly for rice, driven by reduced international supply [26][27] - The balance of the Petroleum Fund was stable at USD 18.45 billion as of March 2024, reflecting a modest increase from the previous year [27] Recent Developments - Global growth remains sluggish, with advanced economies experiencing a slowdown to 1.5 percent in 2023, while Timor-Leste's economic recovery lags behind regional averages [38][39] - Domestic economic expansion slowed due to political transitions, with private consumption increasing by 3.2 percent, supported by remittance inflows [42][43] - Budget execution rates remain low, with only 25 percent of the total Central Government budget expended by May 2024, aligning with historical averages [25][61] Outlook and Risks - Timor-Leste is forecasted to maintain a recovery trajectory, with growth rates nearing 3 percent in 2024 and averaging 3.7 percent from 2024 to 2026, driven by government expenditure and efficient capital investments [28][29] - The fiscal deficit is projected to remain around 44.8 percent of GDP in the medium term, with non-oil domestic revenues expected to be around 10 percent of GDP [29] - The economic outlook faces downside risks, including geopolitical tensions, rising energy prices, and potential disruptions from extreme weather events [30] Special Focus: Leveraging WTO Accession - Timor-Leste's accession to the WTO presents an opportunity to broaden its economic base and enhance trade relations, particularly in niche agricultural exports [33] - Policymakers are tasked with prioritizing reforms to facilitate economic diversification and improve the business climate to attract foreign direct investment [34][35] - The path to leveraging WTO membership hinges on compliance, modernization, and inclusiveness, requiring strategic policy reforms and institutional modernization [35]