GTAP Resources: Resource Display
GTAP Resource #6874 |
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"Impact of Revival Policy for Public Sector Productivity" by Batbayar, Nyambaatar, Oyunzul Tserendorj and Enkhsaikhan Usny-Ekh Abstract The public sector's poor efficiency is a factor hindering Mongolia's development. Despite the poor efficiency, the number of employees in the public sector has expanded significantly during the last decade. To combat this issue, the Parliament of Mongolia has adopted a ten-year development policy, the "Revival Policy for Public Sector Productivity". This policy aims to increase the productivity in the public sector by digitalizing the public services, optimizing the structure of the public sector, eliminating the duplicated systems, improving the efficiency of state-owned enterprises, and decreasing corruption in the public sector. This paper's objective is to evaluate the economic impact of the Revival Policy for Public Sector Productivity by utilizing a dynamic Computable General Equilibrium model calibrated to the 2018 SAM. We extend the PEP-1-t model with some additional features and variables for our analysis. Using the model, we simulate a positive productivity shock in the public sector and a decrease in corruption separately. We also simulate their combined effects. To quantify the effects, we develop a business-as-usual scenario, which simulates a balanced growth path of the Mongolian economy for the next 10 years and compare the policy scenarios to it. The findings of the simulations imply that both the public sector productivity growth and decreased corruption have positive impact on the economy. The public sector efficiency improves in all policy scenarios as the labor shifts from the public sector to the private sector while the production of the public sector increases. The combined effect of the increased productivity in public sector and decreased corruption is also positive. However, due to decreased wage and decreased corruption income, household income decreases. |
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- Dynamic modeling - Model extension/development - Domestic policy analysis - Economic development - Technological change - Asia (East) |
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Last Modified: 9/15/2023 1:05:45 PM