Growth and Poverty. The case of MÃ©xico
Although poverty levels have been diminishing in Mexico since the late 90â€™s, several regions still show high levels of poverty which are extremely high in some rural areas. The paper addresses the issue of the linkages between sectoral growth (urban/rural) and poverty levels by applying Ravallion and Datt (1996) reduced equationÂ´s approach to regional data for Mexico. Poverty levels in rural and urban areas are thus linked to the performance of agricultural and non agricultural growth. Although the data cover only 8 years, following Deaton (1994) we make use, for the first time to these data to the best of our knowledge, of their spatial variation to get enough degrees of freedom. The main finding of the paper was that, although both types of growth impacted negatively on poverty levels in Mexico, rural growth seems to have had substantially higher power in improving consumption per capita for the poorest among the poor people. Urban growth affected mostly urban poverty whereas rural growth affected principally rural poverty. The only inter-sector linkage found was the one that connects rural growth with urban poverty for those people above the food-poverty line but below the moderate poverty line. Exploring plausible channels, we have found that whilerural growth enhances equality of income distribution at total and urban levels, urban growth does exactly the opposite increasing inequality in rural areas. We further explored labor market issues and found that rural growth impacted positively on labor demand for unskilled workers. We have also explored the issue of the impact of rural/urban growth on relative food prices, although no impact was found here. The share of agriculture in total income is relatively more important for poor people in rural areas, and most of the food-poor people live in rural areas. This may be at the root of our findings
|Date of creation:||11 Aug 2004|
|Date of revision:|
|Contact details of provider:|| Phone: 1 212 998 3820|
Fax: 1 212 995 4487
Web page: http://www.econometricsociety.org/pastmeetings.asp
More information through EDIRC
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.:
- Gaurav Datt & Martin Ravallion, 1998.
"Farm productivity and rural poverty in India,"
Journal of Development Studies,
Taylor & Francis Journals, vol. 34(4), pages 62-85.
- Lipton, Michael & Ravallion, Martin, 1993.
"Poverty and policy,"
Policy Research Working Paper Series
1130, The World Bank.
- Woden, Q.T. & Ayres, W. & Barenstein, M. & Hicks, N. & Lee, K. & Maloney, W. & Peeters, P. & Siaens, C. & Yitzjaki, S., 2000. "Poverty and Policy in Latin America and Caribeean," Papers 467, World Bank - Technical Papers.
- Miguel Székely & Nora Lustig & Martin Cumpa & José Antonio Mejía-Guerra, 2000.
"Do We Know How Much Poverty There Is?,"
IDB Publications (Working Papers)
6477, Inter-American Development Bank.
- Levy, Santiago, 1991. "Poverty alleviation in Mexico," Policy Research Working Paper Series 679, The World Bank.
- Kakwani, Nanak, 1993. "Statistical Inference in the Measurement of Poverty," The Review of Economics and Statistics, MIT Press, vol. 75(4), pages 632-39, November.
- Szekely, Miguel & Lustig, Nora & Cumpa, Martin & Antonio Mejia, Jose, 2000. "Do we know how much poverty there is?," Working Papers 244243, Inter-American Development Bank.
When requesting a correction, please mention this item's handle: RePEc:ecm:latm04:93. 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: (Christopher F. Baum)
If references are entirely missing, you can add them using this form.