The present paper focuses on the role of domestic resource mobilization for financing poverty eduction strategies. Policy makers should be aware of important macroeconomic trade-of s associated with MDG strategies financed from tax increases or domestic borrowing. The trade-offs are largely intertemporal: can poor and middle-income countries absorb the initial financing costs in order to achieve expected gains in productivity and human development over time? This calls for a dynamic economy-wide framework to identify the importance of such trade-offs. The paper presents such a framework and illustrates its usefulness in applications for Costa Rica and Ecuador.
Constraints to domestic resource mobilization in developing countries -- An economy-wide framework to analyze feasible financing strategies for achieving the MDGs -- Domestic resource mobilization for MDG achievement: country applications -- Conclusions.

29 p. : chart, graphs, tables

Includes bibliographical references (p. 28-29).