Advanced Search
MyIDEAS: Login

The effect of growth on poverty reduction

Contents:

Author Info

  • Jaya Krishnakumar
  • Cristian Ugarte

Abstract

The aim of this paper is to understand the impact of growth on poverty reduction in a right-skewed income distribution setting. Ex- isting literature focuses on the effect of aggregate growth on the mean income of the poor by means of a regression of the latter on the for- mer. This, however, neglects the effect of other distributional changes (e.g. inequality change) on the income of the poor thus making the above regression misspecified. This paper proposes a suitable theoret- ical framework consistent with the right-skewness for examining the growth impact on poverty taking inequality (dispersion) into account. We show that an economic policy that positively affects the median income of the distribution has a proportional change on the median income of the poor, whatever be the change in inequality. On the other hand, when a policy has a positive impact on the mean income, its effect on the mean income of the poor can be uncertain depending on the accompanying change in inequality. This is illustrated by sim- ulations as well as an empirical application.

Download Info

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
File URL: http://www.unige.ch/ses/dsec/repec/files/11061.pdf
Download Restriction: no

Bibliographic Info

Paper provided by Département des Sciences Économiques, Université de Genève in its series Research Papers by the Department of Economics, University of Geneva with number 11061.

as in new window
Length: 27 pages
Date of creation: Jun 2011
Date of revision:
Handle: RePEc:gen:geneem:11061

Contact details of provider:
Postal: 40 Boulevard du Pont-d'Arve, CH-1211 Geneva 4, Switzerland
Phone: +41 22 379 8263
Fax: +41 22 379 82 93
Email:
Web page: http://www.unige.ch/ses/dsec/

Related research

Keywords: Pro-poor growth; Poverty; Inequality; Income distribution.;

References

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
as in new window
  1. Kraay, Aart, 2006. "When is growth pro-poor? Evidence from a panel of countries," Journal of Development Economics, Elsevier, vol. 80(1), pages 198-227, June.
  2. David Dollar & Aart Kraay, 2004. "Trade, Growth, and Poverty," Economic Journal, Royal Economic Society, vol. 114(493), pages F22-F49, 02.
  3. Lombardo, Vincenzo, 2008. "Growth and inequality effects on poverty reduction in Italy," MPRA Paper 14351, University Library of Munich, Germany.
  4. John Thornton, 2001. "The Kuznets inverted-U hypothesis: panel data evidence from 96 countries," Applied Economics Letters, Taylor & Francis Journals, vol. 8(1), pages 15-16.
  5. Humberto Lopez & Luis Serven, 2014. "A normal relationship? Poverty, growth, and inequality," Annals of Economics and Finance, Society for AEF, vol. 15(2), pages 593-624, November.
  6. Ferreira, Francisco H.G. & Leite, Phillippe G. & Ravallion, Martin, 2010. "Poverty reduction without economic growth?: Explaining Brazil's poverty dynamics, 1985-2004," Journal of Development Economics, Elsevier, vol. 93(1), pages 20-36, September.
  7. Dollar, David & Kraay, Aart, 2002. " Growth Is Good for the Poor," Journal of Economic Growth, Springer, vol. 7(3), pages 195-225, September.
  8. Ravallion, Martin & Shaohua Chen, 2001. "Measuring pro-poor growth," Policy Research Working Paper Series 2666, The World Bank.
  9. Ravallion, Martin, 2001. "Growth, inequality, and poverty : looking beyond averages," Policy Research Working Paper Series 2558, The World Bank.
  10. Son, Hyun Hwa, 2004. "A note on pro-poor growth," Economics Letters, Elsevier, vol. 82(3), pages 307-314, March.
  11. Ravallion, Martin & Huppi, Monika, 1991. "Measuring Changes in Poverty: A Methodological Case Study of Indonesia during an Adjustment Period," World Bank Economic Review, World Bank Group, vol. 5(1), pages 57-82, January.
  12. Ahluwalia, Montek S, 1976. "Income Distribution and Development: Some Stylized Facts," American Economic Review, American Economic Association, vol. 66(2), pages 128-35, May.
  13. Ravallion, Martin & Datt, Gaurav, 2002. "Why has economic growth been more pro-poor in some states of India than others?," Journal of Development Economics, Elsevier, vol. 68(2), pages 381-400, August.
Full references (including those not matched with items on IDEAS)

Citations

Lists

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

Statistics

Access and download statistics

Corrections

When requesting a correction, please mention this item's handle: RePEc:gen:geneem:11061. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: ().

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.