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Poor areas, or only poor people?

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  • Ravallion, Martin
  • Wodon, Quentin

Abstract

Instead of targeting poor areas, should poverty programs target households with personal attributes that foster poverty, no matter where they live? Possibly not. There may be hidden constraints on mobility, or location may reveal otherwise hidden householdattributes. Using survey data for Bangladesh, the authors find significant and sizable geographic effects on living standards, after controlling for a wide range of nongeographic characteristics of households, as would typically be observable to policymakers. The geographic effects are reasonably stable over time, robust to testable sources of bias, and consistent with observed migration patterns. Poor areas are not poor just because households with readily observable attributes that foster poverty are geographically concentrated. There appear to be sizable spatial differences in the returns to given household characteristics. Their results reinforce the case for anti-poverty programs targeted to poor areas even in an economy with few obvious impediments to mobility.

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Bibliographic Info

Paper provided by The World Bank in its series Policy Research Working Paper Series with number 1798.

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Date of creation: 31 Jul 1997
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Handle: RePEc:wbk:wbrwps:1798

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Related research

Keywords: Poverty Lines; Environmental Economics&Policies; Housing&Human Habitats; Poverty Diagnostics; Poverty Assessment;

References

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  1. Lipton, Michael & Ravallion, Martin, 1995. "Poverty and policy," Handbook of Development Economics, Elsevier, in: Hollis Chenery & T.N. Srinivasan (ed.), Handbook of Development Economics, edition 1, volume 3, chapter 41, pages 2551-2657 Elsevier.
  2. Lanjouw, Peter & Ravallion, Martin, 1995. "Poverty and Household Size," Economic Journal, Royal Economic Society, Royal Economic Society, vol. 105(433), pages 1415-34, November.
  3. Wellisch, Dietmar, 1993. "On the decentralized provision of public goods with spillovers in the presence of household mobility," Regional Science and Urban Economics, Elsevier, vol. 23(5), pages 667-679, November.
  4. Myers, Gordon M., 1990. "Optimality, free mobility, and the regional authority in a federation," Journal of Public Economics, Elsevier, vol. 43(1), pages 107-121, October.
  5. Flatters, Frank & Henderson, Vernon & Mieszkowski, Peter, 1974. "Public goods, efficiency, and regional fiscal equalization," Journal of Public Economics, Elsevier, vol. 3(2), pages 99-112, May.
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