http://www.imf.org/external/np/res/seminars/2002/poverty/ns.pdf

This paper reviews the various tools presently available to evaluate the impact of economic policies in general on poverty reduction, or on the distribution of living standards, and explores directions for improvement. It is organized around the common thread of 'incidence analysis'. But this basic micro-economic evaluation tool is used in different contexts and in different ways so as to accommodate a wide range of policies with some potential impact on poverty. In particular, the paper covers indirect taxation and subsidies, public spending programs, at the national and local levels and from an ex-ante and an ex-post point of view, and macro-economic policies, in situations of either steady growth or crisis periods. By suggesting that incidence analysis could also be applied using samples of firms, it also touches upon the role of institutions and more generally policies aimed at improving the investment climate.(au)