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Institutional Framework and Poverty: A Transition Economy Perspective

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  • Syed M. Ahsan

Abstract

This paper focuses on the role of institutions in poverty alleviation, where both poverty and institutions are interpreted broadly. The broadening of the poverty notion is important at least from the policy perspective. Even if one were convinced that higher growth would reduce income poverty to an acceptable margin, there appears to be little concrete policy measures that one may offer so as to harness greater growth. Besides, the weight of the empirical evidence to date, if not squarely founded on the transition economies of the EEFSU region, is that reducing average poverty is not enough. Existing and possibly rising inequality would ensure that a great many would fall through the cracks, and not benefit from high growth, even if that was achievable. The non-income elements of poverty, on the other hand, are more directly open to influence by policy interventions such as the easing of micro credit and other public and private ventures in health, sanitation, literacy and numeracy fronts. Finally the modest amount of information available at our disposal indicates that the underlying strength of the institutions (economic, political and social) is possibly the single most agent of significance to bring about the alleviation of non-income poverty. There is a further possibility that the same institutional forces would also materially affect the income measure of poverty as well in a discernible fashion.

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Paper provided by CESifo Group Munich in its series CESifo Working Paper Series with number 593.

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Date of creation: 2001
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Handle: RePEc:ces:ceswps:_593

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  1. Hjøllund, Lene & Paldam, Martin & Svendsen, Gert Tinggaard, 2001. "Social Capital in Russia and Denmark: A Comparative Study," Working Papers 01-13, University of Aarhus, Aarhus School of Business, Department of Economics.
  2. Sen, Amartya K, 1976. "Poverty: An Ordinal Approach to Measurement," Econometrica, Econometric Society, vol. 44(2), pages 219-31, March.
  3. 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.
  4. Kaufmann, Daniel & Kraay, Aart & Zoido-Lobaton, Pablo, 1999. "Aggregating governance indicators," Policy Research Working Paper Series 2195, The World Bank.
  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. Shaohua Chen & Datt, Gaurav & Ravallion, Martin, 1993. "Is poverty increasing in the developing world?," Policy Research Working Paper Series 1146, The World Bank.
  7. Dollar, David & Kraay, Aart, 2001. "Trade, growth, and poverty," Policy Research Working Paper Series 2615, The World Bank.
  8. Kaufmann, Daniel & Kraay, Aart & Zoido-Lobaton, Pablo, 1999. "Governance matters," Policy Research Working Paper Series 2196, The World Bank.
  9. North, D.C., 1990. "A Transaction Cost Theory of Politics," Papers 144, Washington St. Louis - School of Business and Political Economy.
  10. Dollar, David & Kraay, Aart, 2001. "Growth is good for the poor," Policy Research Working Paper Series 2587, The World Bank.
  11. Kanbur, Ravi & Squire, Lyn, 1999. "The Evolution of Thinking About Poverty: Exploring the Interactions," Working Papers 127697, Cornell University, Department of Applied Economics and Management.
  12. Dani Rodrik, 2000. "Institutions for High-Quality Growth: What They are and How to Acquire Them," NBER Working Papers 7540, National Bureau of Economic Research, Inc.
  13. Ravallion, Martin, 2001. "Growth, inequality, and poverty : looking beyond averages," Policy Research Working Paper Series 2558, The World Bank.
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Cited by:
  1. Iancu, Aurel, 2009. "Institutional Convergence," Working Papers of National Institute of Economic Research 090101, National Institute of Economic Research.

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