Three Shades of Welfare in Applied Economics

Abstract

This dissertation comprises of three essays, organized in chapters, on the broader topic of welfare in applied economics. The first essay studies the implications of high food prices resulting from climate change on food security in small islands, using Mauritius as a case-study. Climate change will adversely impact prices of agricultural commodities. The study derives and calculates the government cost and the welfare effects of an increase in world price of rice on consumers in Mauritius. Using an equilibrium displacement model, this study finds that an increase in the price of rice by 35%, as predicted by the literature on climate change and rice prices, will result in an increase of 28.8% in government spending, representing the additional outlays to support a rice subsidy scheme for food security. Using 2012 as the baseline, the welfare analysis results suggest that consumer surplus for ration rice consumers increases by Mauritian Rupees 626 million (USD 18 million) while consumer surplus decreases by Mauritian Rupees 454 million (USD13 million) for basmati rice consumers. The second paper focuses on welfare of women in society and hypothesizes that gender wage gap decreases with the implementation of a national gender policy framework (NGPF) from 2007 to 2017 on the island of Mauritius. Using data from the household budget surveys of 2007, 2012 and 2017, the impact of the policy is analyzed using difference-in-differences. The results indicate that no significant changes occurred in 2012 in the wage gap between men and women after controlling for human specification, industry, and occupation. The policy impact was significant in 2017 when controlling for industry and occupation. The final chapter attempts to determine whether negative personal attitudes toward welfare may prevent eligible persons from applying for food stamps in the United States. Using the dataset from the 2002 National Survey of American Families (NSAF), a logistic regression model was run. The findings of this study indicate that negative attitudes towards welfare may prevent people from applying for food stamps. Food insecurity on the other hand, increases the likelihood of applying for food stamps. Demographic variables such as education and marital status also influence the probability of applying for food stamps.