Comparative effectiveness of economic policy instruments on household welfare in the WAEMU zone
Developing countries in general have recorded significant growth rates in recent years. At the same time, however, they are still at the bottom of the global ranking of countries in terms of their Human Development Index levels. Sub-Saharan African countries, for example, remain among the countries with the lowest HDI in the world. The improvement in economic performance in developing countries highlighted above is not necessarily assisted by an improvement in the populations’ welfare of the countries concerned. This situation raises the issue of the ineffectiveness of economic policy in these countries in terms of improving welfare. More precisely, this situation leads us to question the effectiveness of the fiscal policy implemented in these countries, since fiscal policy is the one that can directly impact the well-being of the populations.
It is therefore necessary to investigate which fiscal policy instruments are most effective and best suited to developing countries when it comes to improving welfare and to place particular emphasis on them. Indeed, as these countries are characterized by a scarcity of resources and at the same time by an explosion of needs, efficiency in public action becomes an imperative. However, to ensure that the results we arrive at do not deviate from the true realities of developing countries, we will make an effort to integrate as many of these countries’ characteristics as possible into the various analytical models that will be used. To this end, in our analysis we will take great account of the problems of inequality and the preponderance of the informal sector that characterize these economies.
Ultimately, the purpose of our study is to make a comparative analysis of the effectiveness of fiscal policy instruments in developing countries in improving welfare, and it is divided into three areas. The first axis will deal with issues of public debt, governance and welfare. The second axis will address the issues of effectiveness of fiscal policy instruments, inequality and welfare. The third axis will address the issues of effectiveness of fiscal policy instruments, cohabitation between the formal and informal sectors, and welfare.
At the end of this study, one should be able to answer two questions: Which fiscal policy instruments are most effective in improving welfare in developing countries? How can fiscal policy instruments in developing countries be optimized so that they have a better impact on people’s well-being?