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Consumption growth and spatial poverty traps: an analysis of the effect of social services and community infrastructures on living standards in rural Peru

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  • Philippe De Vreyer

    ()
    (DIAL, Paris)

  • Javier Herrera

    ()
    (DIAL, Paris)

  • Sandrine Mesplé-Somps

    ()
    (DIAL, Paris)

Abstract

We test the effect of local geographic endowment of capital on household growth in living standards in rural Peru, using a four years unbalanced panel data set. Our theoretical model of household consumption growth allows for the effect of community variables to modify the returns to augmented capital in the household production function. Three different sources of data are used: the ENAHO 1997-2000 household surveys, the population census of 1993 and the district infrastructure census of 1997. Altogether the addition of these different data sources makes an unusually rich data set, at least when considered with developing country standards. As in Jalan and Ravallion (2002), we use a quasi-differencing method to identify the impact of locally determined geographic and socioeconomic variables, while removing unobserved household and community level fixed effects. GMM are then used to estimate the model parameters. Several significant interesting results appear, confirming that private consumption growth depends on local geographic variables.

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Bibliographic Info

Paper provided by Ibero-America Institute for Economic Research in its series Ibero America Institute for Econ. Research (IAI) Discussion Papers with number 124.

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Length: 35 pages
Date of creation: 21 Oct 2005
Date of revision:
Handle: RePEc:got:iaidps:124

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Cited by:
  1. Johannes Gräb & Michael Grimm, 2007. "Robust Multiperiod Poverty Comparisons," Discussion Papers of DIW Berlin 725, DIW Berlin, German Institute for Economic Research.
  2. Michael Grimm, 2005. "Removing the anonymity axiom in assessing pro-poor growth," Ibero America Institute for Econ. Research (IAI) Discussion Papers 113, Ibero-America Institute for Economic Research.
  3. Gräb, J. & Grimm, M., 2009. "Spatial inequalities explained: evidence from Burkina Faso," ISS Working Papers - General Series 18725, International Institute of Social Studies of Erasmus University Rotterdam (ISS), The Hague.

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