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Social Protection for Poverty Reduction in Times of Crisis

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  • Youssouf KIENDREBEOGO
  • Abdoulaye TALL
  • Kossi ASSIMAIDOU

Abstract

The recent global crisis has highlighted the need to protect the poor and people vulnerable to adverse shocks. Many countries have implemented various programmes to protect social spending and help poor people during periods of financial crisis. This paper uses the most comprehensive database on social spending compiled thus far, and the unique cross-country database on poverty to explore the poverty-reducing role of social protection during financial crises. Using advanced panel data techniques to deal with endogeneity issues, we find that financial crises are associated with slower reductions in the poverty headcount and the poverty gap. Crises lead to 526,400-555,000 additional poor people and to an increase of 4.7-10.6 percentage points in the poverty gap in the medium to long term. These devastating effects of crises on poverty are relatively lower—by 11 and 20 percentage points for each percentage point increase in social spending for the poverty headcount and the poverty gap, respectively—in countries with higher social spending, suggesting the importance of social protection for poverty reduction in times of crisis and potential gains from policy intervention.

Suggested Citation

  • Youssouf KIENDREBEOGO & Abdoulaye TALL & Kossi ASSIMAIDOU, 2013. "Social Protection for Poverty Reduction in Times of Crisis," Working Papers 201311, CERDI.
  • Handle: RePEc:cdi:wpaper:1447
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    1. repec:agr:journl:v:4(621):y:2019:i:4(621):p:163-180 is not listed on IDEAS
    2. Anderson, Edward & d'Orey, Maria Ana Jalles & Duvendack, Maren & Esposito, Lucio, 2018. "Does Government Spending Affect Income Poverty? A Meta-regression Analysis," World Development, Elsevier, vol. 103(C), pages 60-71.
    3. Tudorache, Maria-Daniela, 2019. "Poverty rate determinants in the Central and Eastern Europe Member States," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics, vol. 26(4), pages 163-180.
    4. Thanh Cong Nguyen, 2022. "The effects of financial crisis on income inequality," Development Policy Review, Overseas Development Institute, vol. 40(6), November.
    5. Tudorache, Maria-Daniela, 2021. "Development in Romania during the post-crisis period: A human, economic and social perspective," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics, vol. 28(3(628)), pages 15-32.
    6. Haojian Dou & Llibang Ma & Shichun Liu & Fang Fang, 2022. "Identification of rural regional poverty type based on spatial multi-criteria decision-making—taking Gansu Province, an underdeveloped area in China, as an example," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 24(3), pages 3439-3460, March.
    7. Nugroho, Anda & Amir, Hidayat & Maududy, Irsyan & Marlina, Irma, 2021. "Poverty eradication programs in Indonesia: Progress, challenges and reforms," Journal of Policy Modeling, Elsevier, vol. 43(6), pages 1204-1224.
    8. Maria-Daniela TUDORACHE, 2021. "Development in Romania during the post-crisis period: A human, economic and social perspective," Theoretical and Applied Economics, Asociatia Generala a Economistilor din Romania - AGER, vol. 0(3(628), A), pages 15-32, Autumn.
    9. Bamanga Umar & Sabri Nayan, 2018. "Poverty Reduction and Stock Market Development:Evidence from Africa," Pakistan Journal of Humanities and Social Sciences, International Research Alliance for Sustainable Development (iRASD), vol. 6(3), pages :338-356, September.

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    More about this item

    Keywords

    Poverty; Social Spending;

    JEL classification:

    • C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models
    • I32 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Measurement and Analysis of Poverty
    • I38 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Government Programs; Provision and Effects of Welfare Programs

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