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Economic Growth and Poverty Reduction: Measurement Issues using Income and Non-Income Indicators

  • Stephan Klasen

    ()

    (Universität Göttingen)

This paper addresses two issues concerning the measurement of pro‐poor growth, a central concept for sustainable poverty reduction in developing countries. First, it attempts to clarify the debates about the definition and measurement of pro poor growth distinguishing between a weak and a strong absolute as well as a relative definition. The relevance of each definition depends on the purpose of the analysis as well as the assumptions regarding growthinequality trade‐offs. Given the focus of existing measures of pro‐poor growth on the income dimension, the second contribution is to present ways to apply the growth incidence curve and the Ravallion‐Chen framework of measuring pro‐poor growth to non‐income indicators. The analysis, which is applied to Bolivia for illustrative purposes, shows that the extension of the propoor growth toolbox to non‐income dimensions greatly improves our understanding of the trends in non‐income indicators along the entire distribution and thus greatly increases our ability to monitor progress towards the non‐income Millennium Development Goals (particularly goals 2‐6) and assess the linkages between income and non‐income poverty along the entire distribution. This can be of critical importance for poverty monitoring as well as policy interventions including the relative merits of growth versus direct intervention to improve the non‐income dimensions of poverty.

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File URL: http://www2.vwl.wiso.uni-goettingen.de/ibero/working_paper_neu/DB142.pdf
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Paper provided by Ibero-America Institute for Economic Research in its series Ibero America Institute for Econ. Research (IAI) Discussion Papers with number 142.

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Length: 27 pages
Date of creation: 08 Jun 2006
Date of revision:
Handle: RePEc:got:iaidps:142
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  1. Klasen, Stephan, 2007. "Poverty, Undernutrition, and Child Mortality: Some Inter-Regional Puzzles and their Implications for Research and Policy," Proceedings of the German Development Economics Conference, Göttingen 2007 17, Verein für Socialpolitik, Research Committee Development Economics.
  2. Chun-Hung Lin, 2007. "Education Expansion, Educational Inequality, and Income Inequality: Evidence from Taiwan, 1976–2003," Social Indicators Research, Springer, vol. 80(3), pages 601-615, February.
  3. Ravallion, Martin & Chen, Shaohua, 2007. "China's (uneven) progress against poverty," Journal of Development Economics, Elsevier, vol. 82(1), pages 1-42, January.
  4. Spatz, Julius & Klasen, Stephan & Grosse, Melanie, 2006. "Creating National Poverty Profiles and Growth Incidence Curves with Incomplete Income or Consumption Expenditure Data: An Application to Bolivia," Proceedings of the German Development Economics Conference, Berlin 2006 26, Verein für Socialpolitik, Research Committee Development Economics.
  5. Klasen, Stephan & Harttgen, Kenneth & Grosse, Melanie, 2005. "Measuring Pro-Poor Growth with Non-Income Indicators," Proceedings of the German Development Economics Conference, Kiel 2005 22, Verein für Socialpolitik, Research Committee Development Economics.
  6. Michael Grimm, 2007. "Removing the anonymity axiom in assessing pro-poor growth," Journal of Economic Inequality, Springer, vol. 5(2), pages 179-197, August.
  7. Basu, Kaushik & Foster, James E, 1998. "On Measuring Literacy," Economic Journal, Royal Economic Society, vol. 108(451), pages 1733-49, November.
  8. Ravallion, Martin, 2001. "Growth, inequality, and poverty : looking beyond averages," Policy Research Working Paper Series 2558, The World Bank.
  9. Ravallion, Martin & Shaohua Chen, 2001. "Measuring pro-poor growth," Policy Research Working Paper Series 2666, The World Bank.
  10. Banerjee, Abhijit V & Duflo, Esther, 2003. " Inequality and Growth: What Can the Data Say?," Journal of Economic Growth, Springer, vol. 8(3), pages 267-99, September.
  11. Grosse, Melanie & Harttgen, Kenneth & Klasen, Stephan, 2006. "Measuring Pro-Poor Progress towards the Non-Income Millennium Development Goals," Working Paper Series RP2006/38, World Institute for Development Economic Research (UNU-WIDER).
  12. Dollar, David & Kraay, Aart, 2001. "Growth is good for the poor," Policy Research Working Paper Series 2587, The World Bank.
  13. Kakwani, N., 1993. "Performance in living standards : An international comparison," Journal of Development Economics, Elsevier, vol. 41(2), pages 307-336, August.
  14. Stephan Klasen, 2003. "In Search of The Holy Grail: How to Achieve Pro-Poor Growth ?," Ibero America Institute for Econ. Research (IAI) Discussion Papers 096, Ibero-America Institute for Economic Research.
  15. Kristin J. Forbes, 2000. "A Reassessment of the Relationship between Inequality and Growth," American Economic Review, American Economic Association, vol. 90(4), pages 869-887, September.
  16. Klasen, Stephan, 2000. "Measuring Poverty and Deprivation in South Africa," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 46(1), pages 33-58, March.
  17. Jean-Yves Duclos & Quentin Wodon, 2004. "What is "Pro-Poor"?," Cahiers de recherche 0425, CIRPEE.
  18. Ravallion, Martin & Datt, Gaurav, 2002. "Why has economic growth been more pro-poor in some states of India than others?," Journal of Development Economics, Elsevier, vol. 68(2), pages 381-400, August.
  19. Klasen, Stephan & Günther, Isabel, 2007. "Measuring Chronic Non-Income Poverty," Proceedings of the German Development Economics Conference, Göttingen 2007 10, Verein für Socialpolitik, Research Committee Development Economics.
  20. Martin Ravallion, 2005. "A poverty-inequality trade off?," Journal of Economic Inequality, Springer, vol. 3(2), pages 169-181, August.
  21. Stephan Klasen & Mark Misselhorn, 2008. "Determinants of the Growth Semi-Elasticity of Poverty Reduction," Ibero America Institute for Econ. Research (IAI) Discussion Papers 176, Ibero-America Institute for Economic Research.
  22. Stephan Klasen & Melanie Grosse & Rainer Thiele & Jann Lay & Julius Spatz & Manfred Wiebelt, 2004. "Operationalizing Pro-Poor Growth - Country Case Study: Bolivia," Ibero America Institute for Econ. Research (IAI) Discussion Papers 101, Ibero-America Institute for Economic Research.
  23. Stephan Klasen, 2006. "Pro-Poor Growth and Gender Inequality," Ibero America Institute for Econ. Research (IAI) Discussion Papers 151, Ibero-America Institute for Economic Research.
  24. Gaurav Datt & Martin Ravallion, 2002. "Is India's Economic Growth Leaving the Poor Behind?," Journal of Economic Perspectives, American Economic Association, vol. 16(3), pages 89-108, Summer.
  25. Kakwani, Nanak & Son, Hyun H., 2006. "Pro-Poor Growth: The Asian Experience," Working Paper Series RP2006/56, World Institute for Development Economic Research (UNU-WIDER).
  26. Kraay, Aart, 2006. "When is growth pro-poor? Evidence from a panel of countries," Journal of Development Economics, Elsevier, vol. 80(1), pages 198-227, June.
  27. Barro, Robert J, 2000. " Inequality and Growth in a Panel of Countries," Journal of Economic Growth, Springer, vol. 5(1), pages 5-32, March.
  28. Deininger, Klaus & Squire, Lyn, 1998. "New ways of looking at old issues: inequality and growth," Journal of Development Economics, Elsevier, vol. 57(2), pages 259-287.
  29. Son, Hyun Hwa, 2004. "A note on pro-poor growth," Economics Letters, Elsevier, vol. 82(3), pages 307-314, March.
  30. Stephen Knowles & Paula K. Lorgelly, 2002. "Are educational gender gaps a brake on economic development? Some cross-country empirical evidence," Oxford Economic Papers, Oxford University Press, vol. 54(1), pages 118-149, January.
  31. Mattias Lundberg & Lyn Squire, 2003. "The simultaneous evolution of growth and inequality," Economic Journal, Royal Economic Society, vol. 113(487), pages 326-344, 04.
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