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How to prioritise policies for poverty reduction: Applying Bayesian Model Averaging to Vietnam

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Author Info
Klump, Rainer
Prüfer, Patricia

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Abstract

The UN Millennium Development Goals have recognized poverty reduction as the main goal of global development policy. A comprehensive framework to evaluate the effectiveness of single policy measures and policy packages with respect to poverty reduction is still lacking, though. Policy evaluation is exposed to manifold uncertainties given the dependency of the preferred outcomes on a chosen policy, available information, and policy makers' preferences. We show that Bayesian Model Averaging (BMA) is most valuable in this context as it addresses the parameter and model uncertainty inherent in development policies. Using data for the 61 Vietnamese provinces we are able to ascertain the most important determinants of poverty from a large number of potential explanatory variables. --

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Paper provided by Verein für Socialpolitik, Research Committee Development Economics in its series Proceedings of the German Development Economics Conference, Kiel 2005 with number 27.

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Date of creation: 2005
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Handle: RePEc:zbw:gdec05:3500

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Related research
Keywords: Poverty determinants; Vietnam; model uncertainty; Bayesian Model Averaging (BMA);

Find related papers by JEL classification:
R11 - Urban, Rural, and Regional Economics - - General Regional Economics - - - Analysis of Growth, Development, and Changes
C11 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: General - - - Bayesian Analysis
C52 - Mathematical and Quantitative Methods - - Econometric Modeling - - - Model Evaluation and Testing
O18 - Economic Development, Technological Change, and Growth - - Economic Development - - - Regional, Urban, and Rural Analyses
O53 - Economic Development, Technological Change, and Growth - - Economywide Country Studies - - - Asia including Middle East

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References listed on IDEAS
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  1. Dagdeviren, Hulya & van der Hoeven, Rolph & Weeks, John, 2002. "Redistribution Does Matter Growth and Redistribution for Poverty Reduction," Working Papers UNU-WIDER Research Paper , World Institute for Development Economic Research (UNU-WIDER). [Downloadable!]
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  16. Durlauf, Steven N. & Quah, Danny T., 1999. "The new empirics of economic growth," Handbook of Macroeconomics, in: J. B. Taylor & M. Woodford (ed.), Handbook of Macroeconomics, edition 1, volume 1, chapter 4, pages 235-308 Elsevier. [Downloadable!] (restricted)
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  17. Henderson, J. Vernon, 2005. "Urbanization and Growth," Handbook of Economic Growth, in: Philippe Aghion & Steven Durlauf (ed.), Handbook of Economic Growth, edition 1, volume 1, chapter 24, pages 1543-1591 Elsevier. [Downloadable!] (restricted)
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  19. Gundlach, Erich & De Pablo, Jose Navarro & Weisert, Natascha, 2001. "Education Is Good for the Poor: A Note on Dollar and Kraay (2001)," Working Papers UNU-WIDER Research Paper , World Institute for Development Economic Research (UNU-WIDER). [Downloadable!]
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  25. Easterly, William, 2001. " The Middle Class Consensus and Economic Development," Journal of Economic Growth, Springer, vol. 6(4), pages 317-35, December. [Downloadable!] (restricted)
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  26. Fritzen, Scott, 2002. "Growth, inequality and the future of poverty reduction in Vietnam," Journal of Asian Economics, Elsevier, vol. 13(5), pages 635-657. [Downloadable!] (restricted)
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