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Poverty Accounting. A fractional response approach to poverty decomposition

Author

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  • Richard Bluhm

    () (Leibniz University Hannover, Germany)

  • Denis de Crombrugghe

    () (Maastricht University, The Netherlands)

  • Adam Szirmai

    () (UNU-MERIT and Maastricht University, The Netherlands)

Abstract

This paper proposes a new empirical framework for poverty accounting. Using a large collection of household surveys from 124 countries, we estimate income and inequality (semi-)elasticities of poverty for the \$2 and \$1.25 a day poverty lines as well as their contributions to poverty alleviation. We show that initial inequality is a strong moderator of the impact of growth and there has been a shift towards more pro-poor growth around the turn of the millennium. We project poverty rates until 2030 and show that an end of extreme poverty within a generation is unlikely.

Suggested Citation

  • Richard Bluhm & Denis de Crombrugghe & Adam Szirmai, 2016. "Poverty Accounting. A fractional response approach to poverty decomposition," Working Papers 413, ECINEQ, Society for the Study of Economic Inequality.
  • Handle: RePEc:inq:inqwps:ecineq2016-413
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    More about this item

    Keywords

    poverty; inequality; income growth; fractional response models.;
    All these keywords.

    JEL classification:

    • I32 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Measurement and Analysis of Poverty
    • C25 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Discrete Regression and Qualitative Choice Models; Discrete Regressors; Proportions; Probabilities
    • O10 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - General
    • O15 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration

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