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Growth with Equity for the Development of Mexico: Poverty, Inequality, and Economic Growth (1992–2008)

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  • Iniguez-Montiel, Alberto Javier

Abstract

This paper constitutes an attempt to determine the relative contribution of changes in economic growth and in the distribution of income to changes in poverty in Mexico. Our findings clearly indicate that growth with redistribution (lower income inequality) was the key to reducing poverty continuously and in an important manner during 2000–2006. However, after 2006, decreasing per-capita income, coupled with the persistently high inequality (Gini of 52%), caused the reversal of the favorable trend observed since 1996, raising poverty to pre-2002 levels. Consequently, it is argued that, for Mexico, a middle-income country exhibiting quite low growth rates and high inequality levels, the further improvement in its distribution of income and assets is essential if the economy is to succeed in making a real dent in poverty. For that purpose, the implementation of an active pro-poor growth policy should be strongly encouraged.

Suggested Citation

  • Iniguez-Montiel, Alberto Javier, 2014. "Growth with Equity for the Development of Mexico: Poverty, Inequality, and Economic Growth (1992–2008)," World Development, Elsevier, vol. 59(C), pages 313-326.
  • Handle: RePEc:eee:wdevel:v:59:y:2014:i:c:p:313-326
    DOI: 10.1016/j.worlddev.2014.01.011
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    3. M. Ali Nasrun & Fariastuti & Sukma Indra, 2020. "The Role of Agricultural Sector in Explaining Poverty in Indonesia: A Study Case of West Kalimantan," International Journal of Economics and Financial Issues, Econjournals, vol. 10(5), pages 297-303.
    4. Saari, M. Yusof & Dietzenbacher, Erik & Los, Bart, 2015. "Sources of Income Growth and Inequality Across Ethnic Groups in Malaysia, 1970–2000," World Development, Elsevier, vol. 76(C), pages 311-328.
    5. Gregory Brock, 2020. "The real Oaxaca decomposition: convergence within Mexico’s Oaxaca region in the twenty-first century—Do types of crime and religious belief matter?," Economic Change and Restructuring, Springer, vol. 53(4), pages 543-569, November.
    6. Guanghua Wan & Chen Wang & Hua Yin & Yan Zhang, 2018. "From Equality of Deprivation to Disparity of Prosperity: The Poverty–Growth–Inequality Triangle in Post†reform China," China & World Economy, Institute of World Economics and Politics, Chinese Academy of Social Sciences, vol. 26(2), pages 50-67, March.
    7. E. Bárcena-Martín & S. Pérez-Moreno, 2017. "Immigrant–native gap in poverty: a cross-national European perspective," Review of Economics of the Household, Springer, vol. 15(4), pages 1105-1136, December.
    8. Aissaoui, Najeh & Ben Hassen, Lobna, 2015. "Skill-biased Technological Change, E-skills and Wage Inequality: Evidence from Tunisia," MPRA Paper 76551, University Library of Munich, Germany, revised 29 Jun 2015.
    9. Alberto Javier Iniguez-Montiel & Takashi Kurosaki, 2018. "Growth, inequality and poverty dynamics in Mexico," Latin American Economic Review, Springer;Centro de Investigaciòn y Docencia Económica (CIDE), vol. 27(1), pages 1-25, December.
    10. Saari, M. Yusof & Rahman, M. Affan Abdul & Hassan, Azman & Habibullah, Muzafar Shah, 2016. "Estimating the impact of minimum wages on poverty across ethnic groups in Malaysia," Economic Modelling, Elsevier, vol. 54(C), pages 490-502.
    11. Mikucka, Malgorzata & Sarracino, Francesco & Dubrow, Joshua K., 2017. "When Does Economic Growth Improve Life Satisfaction? Multilevel Analysis of the Roles of Social Trust and Income Inequality in 46 Countries, 1981–2012," World Development, Elsevier, vol. 93(C), pages 447-459.
    12. Egla Mansi & Eglantina Hysa & Mirela Panait & Marian Catalin Voica, 2020. "Poverty—A Challenge for Economic Development? Evidences from Western Balkan Countries and the European Union," Sustainability, MDPI, Open Access Journal, vol. 12(18), pages 1-24, September.
    13. Isaac Appiah-Otoo & Na Song, 2021. "The Impact of Fintech on Poverty Reduction: Evidence from China," Sustainability, MDPI, Open Access Journal, vol. 13(9), pages 1-13, May.
    14. Francesco Sarracino & Kelsey J. O’Connor, 2021. "Economic growth and well-being beyond the Easterlin paradox," Chapters, in: Luigino Bruni & Alessandra Smerilli & Dalila De Rosa (ed.), A Modern Guide to the Economics of Happiness, chapter 9, pages 162-188, Edward Elgar Publishing.
    15. Deborah S. DeGraff & Rebeca Wong & Karina Orozco-Rocha, 2018. "Dynamics of Economic Security Among the Aging in Mexico: 2001–2012," Population Research and Policy Review, Springer;Southern Demographic Association (SDA), vol. 37(1), pages 59-90, February.
    16. Temilola Osinubi, Tolulope, 2020. "The Role Of Income Inequality In The Globalisation-Poverty Nexus: Empirical Evidence From Mint Countries," Ilorin Journal of Economic Policy, Department of Economics, University of Ilorin, vol. 7(2), pages 67-89, June.

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