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The Role of Education and Income in Poverty Alleviation: A Cross-Country Analysis

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  • Pervez Zammurad Janjua

    ()
    (International Institute of Islamic Economics, International Islamic University, Islamabad, Pakistan.)

  • Usman Ahmad Kamal

    ()

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    Abstract

    The existing literature on education and poverty considers mostly primary data from an income point of view. However, the benefits of education vary from a direct income effect to positive externalities, which can help reduce poverty. This paper uses panel data for 40 developing countries for the period 1999 to 2007, and estimates coefficients by applying the random effect generalized least squares (GLS) technique. The study concludes, first, that income growth plays a moderately positive role in alleviating poverty, but that income distribution does not play a key role in poverty alleviation in the sample overall. Second, it concludes that education is the most significant contributor to poverty alleviation.

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    Bibliographic Info

    Article provided by Department of Economics, The Lahore School of Economics in its journal Lahore Journal of Economics.

    Volume (Year): 16 (2011)
    Issue (Month): 1 (Jan-Jun)
    Pages: 143-172

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    Handle: RePEc:lje:journl:v:16:y:2011:i:1:p:143-172

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    Related research

    Keywords: Education; income; income distribution; poverty alleviation; GLS; Pakistan.;

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    References

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    1. Squire, Lyn, 1993. "Fighting Poverty," American Economic Review, American Economic Association, vol. 83(2), pages 377-82, May.
    2. Fafchamps, Marcel & Quisumbing, Agnes R., 1998. "Human capital, productivity, and labor allocation in rural Pakistan," FCND discussion papers 48, International Food Policy Research Institute (IFPRI).
    3. Norman Gemmell,, . "Evaluating the Impacts of Human Capital Stocks and Accumulation on Economic Growth: Some New Evidence," Discussion Papers 95/17, University of Nottingham, CREDIT.
    4. Alan B. Krueger & Mikael Lindahl, 2000. "Education for Growth: Why and For Whom?," NBER Working Papers 7591, National Bureau of Economic Research, Inc.
    5. Ravallion, Martin & Datt, Gaurav, 1996. "How Important to India's Poor Is the Sectoral Composition of Economic Growth?," World Bank Economic Review, World Bank Group, vol. 10(1), pages 1-25, January.
    6. GOH, Chor-ching & LUO, Xubei & ZHU, Nong, 2009. "Income growth, inequality and poverty reduction: A case study of eight provinces in China," China Economic Review, Elsevier, vol. 20(3), pages 485-496, September.
    7. Canagarajah, Sudharshan & Mazumdar, Dipak & Xiao Ye, 1998. "The structure and determinants of inequality and poverty reduction in Ghana, 1988-92," Policy Research Working Paper Series 1998, The World Bank.
    8. Alemayehu Geda & Niek de Jong & Mwangi S. Kimenyi & Germano Mwabu, 2005. "Determinants of Poverty in Kenya: A Household Level Analysis," Working papers 2005-44, University of Connecticut, Department of Economics.
    9. G. Ellis, 1984. "The dimensions of poverty," Social Indicators Research, Springer, vol. 15(3), pages 229-253, October.
    10. Sudhir Anand & Martin Ravallion, 1993. "Human Development in Poor Countries: On the Role of Private Incomes and Public Services," Journal of Economic Perspectives, American Economic Association, vol. 7(1), pages 133-150, Winter.
    11. Verner, Dorte, 2004. "Education and its poverty-reducing effects: The case of Paraiba, Brazil," Policy Research Working Paper Series 3321, The World Bank.
    12. Datt, Gaurav & Ravallion, Martin, 1996. "Why have some Indian states done better than others at reducing rural poverty?," Policy Research Working Paper Series 1594, The World Bank.
    13. Timothy Besley & Robin Burgess, 2003. "Halving Global Poverty," Journal of Economic Perspectives, American Economic Association, vol. 17(3), pages 3-22, Summer.
    14. Ravallion, Martin, 2003. "The debate on globalization, poverty, and inequality : why measurement matters," Policy Research Working Paper Series 3038, The World Bank.
    15. E. Roy Weintraub & Evelyn L. Forget, 2007. "Introduction," History of Political Economy, Duke University Press, vol. 39(5), pages 1-6, Supplemen.
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    Cited by:
    1. M. Akram, Mian & Afzal, Muhammad, 2014. "Dynamic Role of Zakat in Alleviating Poverty: A Case Study of Pakistan," MPRA Paper 56013, University Library of Munich, Germany.
    2. Ahmed Raza Cheema & Ahmed Raza Cheema, 2012. "Poverty, Income Inequality, and Growth in Pakistan: A Pooled Regression Analysis," Lahore Journal of Economics, Department of Economics, The Lahore School of Economics, vol. 17(2), pages 137-157, July-Dec.

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