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Growth and Chronic Poverty: Evidence from Rural Communities in Ethiopia

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  • Stefan Dercon
  • John Hoddinott
  • Tassew Woldehanna

Abstract

What keeps some people persistently poor, even in the context of relative high growth? In this article, we explore this question using a 15-year longitudinal data set from Ethiopia. We compare the findings of an empirical growth model with those derived from a model of the determinants of chronic poverty. We ask whether the chronically poor are simply not benefiting in the same way from the same factors that allowed others to escape poverty, or whether there are latent factors that leave them behind? We find that this chronic poverty is associated with several initial characteristics: lack of physical assets, education and ‘remoteness’ in terms of distance to towns or poor roads. The chronically poor appear to benefit from some of the drivers of growth, such as better roads or extension services, in much the same way that the non-chronically poor benefit. However, they appear to have lower growth in this period, related to time-invariant characteristics, and this suggests that they face a considerable growth and standard of living handicap.

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Bibliographic Info

Article provided by Taylor & Francis Journals in its journal Journal of Development Studies.

Volume (Year): 48 (2012)
Issue (Month): 2 (February)
Pages: 238-253

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Handle: RePEc:taf:jdevst:v:48:y:2012:i:2:p:238-253

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  1. Stefan Dercon, 2003. "Growth and Shocks: evidence from rural Ethiopia," Economics Series Working Papers WPS/2003-12, University of Oxford, Department of Economics.
  2. Stefan Dercon & Daniel O. Gilligan & John Hoddinott & Tassew Woldehanna, 2007. "The impact of roads and agricultural extension on consumption growth and poverty in fifteen Ethiopian villages," CSAE Working Paper Series 2007-01, Centre for the Study of African Economies, University of Oxford.
  3. Andreou, Elena & Ghysels, Eric & Kourtellos, Andros, 2010. "Regression models with mixed sampling frequencies," Journal of Econometrics, Elsevier, vol. 158(2), pages 246-261, October.
  4. Deaton, A. & Zaidi, S., 1999. "Guidelines for Constructing Consumption Aggregates for Welfare Analysis," Papers 192, Princeton, Woodrow Wilson School - Development Studies.
  5. Michelle Adato & Michael Carter & Julian May, 2006. "Exploring poverty traps and social exclusion in South Africa using qualitative and quantitative data," Journal of Development Studies, Taylor & Francis Journals, vol. 42(2), pages 226-247.
  6. Jonathan Temple, 1999. "The New Growth Evidence," Journal of Economic Literature, American Economic Association, vol. 37(1), pages 112-156, March.
  7. Bob Baulch & John Hoddinott, 2000. "Economic mobility and poverty dynamics in developing countries," Journal of Development Studies, Taylor & Francis Journals, vol. 36(6), pages 1-24.
  8. James E. Foster, 2007. "A Class of Chronic Poverty Measures," Vanderbilt University Department of Economics Working Papers 0701, Vanderbilt University Department of Economics.
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Cited by:
  1. Monica Beuran & Marie Castaing Gachassin & Gaël Raballand, 2013. "Are There Myths on Road Impact and Transport in Sub-Saharan Africa?," Documents de travail du Centre d'Economie de la Sorbonne 13049, Université Panthéon-Sorbonne (Paris 1), Centre d'Economie de la Sorbonne.
  2. Negash, Martha, 2012. "Biofuels and Food Security: Micro-evidence from Ethiopia," 2012 Conference, August 18-24, 2012, Foz do Iguacu, Brazil 126793, International Association of Agricultural Economists.
  3. Monica Beuran & Marie Castaing Gachassin & Gaël Raballand, 2013. "Are There Myths on Road Impact and Transport in Sub-Saharan Africa?," Université Paris1 Panthéon-Sorbonne (Post-Print and Working Papers) halshs-00830006, HAL.
  4. Negash, Martha & Swinnen, Johan F.M., 2013. "Biofuels and food security: Micro-evidence from Ethiopia," Energy Policy, Elsevier, vol. 61(C), pages 963-976.
  5. Diaz, Yadira & Pudney, Stephen, 2013. "Measuring poverty persistence with missing data with an application to Peruvian panel data," ISER Working Paper Series 2013-22, Institute for Social and Economic Research.
  6. Xavier Vollenweider, 2014. "A simple framework for the estimation of climate exposure," Grantham Research Institute on Climate Change and the Environment Working Papers 158, Grantham Research Institute on Climate Change and the Environment.
  7. Abegaz, Berhanu, 2013. "Aid, accountability, and institution-building in Ethiopia: A comparative analysis of donor practice," Working Paper Series UNU-WIDER Research Paper , World Institute for Development Economic Research (UNU-WIDER).
  8. Ambaye, Guesh Gebremeskel, 2012. "Perception of Poverty by Ethiopian Rural Households: Using a Self Reported approach," AGRIS on-line Papers in Economics and Informatics, Czech University of Life Sciences Prague, Faculty of Economics and Management, vol. 4(4), December.

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