IDEAS home Printed from https://ideas.repec.org/p/got/iaidps/124.html
   My bibliography  Save this paper

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

Author

Listed:
  • 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.

Suggested Citation

  • Philippe De Vreyer & Javier Herrera & Sandrine Mesplé-Somps, 2005. "Consumption growth and spatial poverty traps: an analysis of the effect of social services and community infrastructures on living standards in rural Peru," Ibero America Institute for Econ. Research (IAI) Discussion Papers 124, Ibero-America Institute for Economic Research.
  • Handle: RePEc:got:iaidps:124
    as

    Download full text from publisher

    File URL: http://www2.vwl.wiso.uni-goettingen.de/ibero/working_paper_neu/DB124.pdf
    Download Restriction: no

    Other versions of this item:

    References listed on IDEAS

    as
    1. Romer, Paul M, 1986. "Increasing Returns and Long-run Growth," Journal of Political Economy, University of Chicago Press, vol. 94(5), pages 1002-1037, October.
    2. Dollar, David & Kraay, Aart, 2002. "Growth Is Good for the Poor," Journal of Economic Growth, Springer, vol. 7(3), pages 195-225, September.
    3. Holtz-Eakin, Douglas & Newey, Whitney & Rosen, Harvey S, 1989. "The Revenues-Expenditures Nexus: Evidence from Local Government Data," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 30(2), pages 415-429, May.
    4. Máximo Torero & Javier Escobal, 2000. "Does Geography Explain Differences in Economic Growth in Peru?," Research Department Publications 3103, Inter-American Development Bank, Research Department.
    5. Ravallion, Martin & Wodon, Quentin, 1997. "Poor areas, or only poor people?," Policy Research Working Paper Series 1798, The World Bank.
    6. Ravallion, Martin, 2001. "Growth, Inequality and Poverty: Looking Beyond Averages," World Development, Elsevier, vol. 29(11), pages 1803-1815, November.
    7. Paxson, Christina*Schady, Norbert, 1999. "Do school facilities matter? : the case of the Peruvian Social Fund (FONCODES)," Policy Research Working Paper Series 2229, The World Bank.
    8. David E. Bloom & Jeffrey D. Sachs, 1998. "Geography, Demography, and Economic Growth in Africa," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, pages 207-296.
    9. Clotfelter, Charles T. & Ehrenberg, Ronald G. & Getz, Malcolm & Siegfried, John J., 1992. "Economic Challenges in Higher Education," National Bureau of Economic Research Books, University of Chicago Press, edition 1, number 9780226110509.
      • Robert J. Barro & Paul M. Romer, 1991. "Economic Growth," NBER Books, National Bureau of Economic Research, Inc, number barr91-1.
    10. Schady, Norbert R, 2002. "Picking the Poor: Indicators for Geographic Targeting in Peru," Review of Income and Wealth, International Association for Research in Income and Wealth, pages 417-433.
    11. Miguel, Edward & Gugerty, Mary Kay, 2005. "Ethnic diversity, social sanctions, and public goods in Kenya," Journal of Public Economics, Elsevier, pages 2325-2368.
    12. Durlauf, Steven N., 1994. "Spillovers, stratification, and inequality," European Economic Review, Elsevier, vol. 38(3-4), pages 836-845, April.
    13. David Stifel & Harold Alderman, 2006. "The "Glass of Milk" Subsidy Program and Malnutrition in Peru," World Bank Economic Review, World Bank Group, vol. 20(3), pages 421-448.
    14. Alberto Alesina & Reza Baqir & William Easterly, 1999. "Public Goods and Ethnic Divisions," The Quarterly Journal of Economics, Oxford University Press, vol. 114(4), pages 1243-1284.
    15. Edmundo Murrugarra & Martin Valdivia, 1999. "The Returns to Health for Peruvian Urban Adults: Differentials Across Genders, the Life Cycle and the Wage Distribution," Research Department Publications 3050, Inter-American Development Bank, Research Department.
    16. Ahn, Seung Chan & Hoon Lee, Young & Schmidt, Peter, 2001. "GMM estimation of linear panel data models with time-varying individual effects," Journal of Econometrics, Elsevier, pages 219-255.
    17. Jyotsna Jalan & Martin Ravallion, 1998. "Geographic Poverty Traps?," Boston University - Institute for Economic Development 86, Boston University, Institute for Economic Development.
    18. Manuel Arellano & Stephen Bond, 1991. "Some Tests of Specification for Panel Data: Monte Carlo Evidence and an Application to Employment Equations," Review of Economic Studies, Oxford University Press, vol. 58(2), pages 277-297.
    19. Robert J. Barro & Paul Romer, 1993. "Economic Growth," NBER Books, National Bureau of Economic Research, Inc, number barr93-1.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Dercon, Stefan, 2004. "Growth and shocks: evidence from rural Ethiopia," Journal of Development Economics, Elsevier, pages 309-329.
    2. Dercon, Stefan, 2004. "Growth and shocks: evidence from rural Ethiopia," Journal of Development Economics, Elsevier, pages 309-329.
    3. Johannes Gräb & Michael Grimm, 2008. "Spatial Inequalities Explained: Evidence from Burkina Faso," Discussion Papers of DIW Berlin 843, DIW Berlin, German Institute for Economic Research.
    4. 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.
    5. Grimm, Michael & Gräb, Johannes, 2007. "Robust Multiperiod Poverty Comparisons," Proceedings of the German Development Economics Conference, Göttingen 2007 8, Verein für Socialpolitik, Research Committee Development Economics.
    6. Grimm, Michael & Gräb, Johannes, 2007. "Robust Multiperiod Poverty Comparisons," Proceedings of the German Development Economics Conference, Göttingen 2007 8, Verein für Socialpolitik, Research Committee Development Economics.
    7. Michael Grimm, 2007. "Removing the anonymity axiom in assessing pro-poor growth," The Journal of Economic Inequality, Springer;Society for the Study of Economic Inequality, pages 179-197.

    More about this item

    JEL classification:

    • C33 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Models with Panel Data; Spatio-temporal Models
    • H23 - Public Economics - - Taxation, Subsidies, and Revenue - - - Externalities; Redistributive Effects; Environmental Taxes and Subsidies
    • I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health
    • I32 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Measurement and Analysis of Poverty
    • I38 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Government Programs; Provision and Effects of Welfare Programs

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:got:iaidps:124. 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: (Sabine Jaep). General contact details of provider: http://edirc.repec.org/data/ibgoede.html .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.