3 Poverty reduction policies

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Redistribution

Influence, advantage and subsidies should be moved away from dominant groups in order to allow more equal opportunities for the very poor and marginalised. 

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Trade-offs need to be assessed

Taxes will be raised to improve access to and quality of schools. However, if they rise too much this will create a massive disincentive: families cannot afford to pay more tax, and the long term benefits of education will seem less worthwhile if they don't actually have enough to eat!

Policy makers should keep this in mind, but still recognise that increased attendance and performance are great gains for individuals and society as a whole. Trade offs and incentives needed to support this.

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Policies for growth and policies for equity are no

Policies that affect one will affect the other. e.g. market policies should have complementary policies for safety nets, mobility and education. Need to protect both.

Policy reforms that result in losses for a particular group will be resisted by that group. If the group is powerful it will usually subvert the reform. 

Benefits AND costs should be taken into account for any new policy.

However, focus on equity must not be an excuse for poor economic policy.

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