Human Development Simulations in a CGE model for Haiti
- Increased public spending in education and health can promote economic growth and reduce poverty.
- Financing mechanisms (foreign aid vs. direct taxes) have different impacts on the economy.
- Investing in human capital without sufficient job creation can lead to higher unemployment and skill mismatches.
- Expanding expenditure in human development requires careful preparation to align the speed of expenditure increases with the ability of education and training programs to deliver properly educated workers.
- The poverty impact depends on changes in the labor market and increases in per capita disposable income.
This document presents a group of simulations related to "Human Development" in Haiti, analyzing the results for both the CGE model and the microsimulation model. The simulations explore the impact of increased public spending in health and education, and social protection, which are currently limited in Haiti. The study creates more fiscal space through exogenous increases in foreign aid or increases in direct taxation. The government then uses this additional fiscal space to expand spending and service delivery in education and health. The purpose is to assess the impact of these different options on promoting economic growth and reducing poverty.
How to cite
Inter-American Development Bank (IDB), 2019, Human Development Simulations in a CGE model for Haiti, https://publications.iadb.org/en/human-development-simulations-cge-model-haiti