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Poverty and Inequality Nexus: Illustrations with Nigerian Data

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  • Abdelkrim Araar
  • Awoyemi Taiwo Timothy

Abstract

The main aim of this paper is to explore the link between poverty and inequality. In developing countries, there is a general consensus that high inequality can dampen significantly the impact of economic performance on poverty. In this paper, we propose a new theoretical framework that links poverty and inequality. We also show between and within group inequalities, as well as inequality in income sources, can contribute to total poverty. The methodology of the paper is illustrated using the 2004 Nigerian national living standard survey.

Suggested Citation

  • Abdelkrim Araar & Awoyemi Taiwo Timothy, 2006. "Poverty and Inequality Nexus: Illustrations with Nigerian Data," Cahiers de recherche 0638, CIRPEE.
  • Handle: RePEc:lvl:lacicr:0638
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    File URL: http://www.cirpee.org/fileadmin/documents/Cahiers_2006/CIRPEE06-38.pdf
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    References listed on IDEAS

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    1. Ravallion, Martin & Chen, Shaohua, 1997. "What Can New Survey Data Tell Us about Recent Changes in Distribution and Poverty?," World Bank Economic Review, World Bank Group, vol. 11(2), pages 357-382, May.
    2. 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.
    3. Lambert, Peter J & Aronson, J Richard, 1993. "Inequality Decomposition Analysis and the Gini Coefficient Revisited," Economic Journal, Royal Economic Society, vol. 103(420), pages 1221-1227, September.
    4. Fields, Gary S, 1989. "Changes in Poverty and Inequality in Developing Countries," World Bank Research Observer, World Bank Group, vol. 4(2), pages 167-185, July.
    5. Abdelkrim Araar, 2006. "On the Decomposition of the Gini Coefficient: an Exact Approach, with an Illustration Using Cameroonian Data," Cahiers de recherche 0602, CIRPEE.
    6. Son, Hyun Hwa, 2004. "A note on pro-poor growth," Economics Letters, Elsevier, vol. 82(3), pages 307-314, March.
    7. Martin Feldstein, 1998. "Income Inequality and Poverty," NBER Working Papers 6770, National Bureau of Economic Research, Inc.
    8. Shlomo Yitzhaki, 1979. "Relative Deprivation and the Gini Coefficient," The Quarterly Journal of Economics, Oxford University Press, vol. 93(2), pages 321-324.
    9. John D. Hey & Peter J. Lambert, 1980. "Relative Deprivation and the Gini Coefficient: Comment," The Quarterly Journal of Economics, Oxford University Press, vol. 95(3), pages 567-573.
    10. 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.
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    Cited by:

    1. Bellemare, Charles & Bissonnette, Luc & Kröger, Sabine, 2007. "Flexible Approximation of Subjective Expectations Using Probability Questions: An Application to the Investment Game," IZA Discussion Papers 3121, Institute for the Study of Labor (IZA).
    2. Abdelkrim Araar, 2008. "On the Decomposition of Polarization Indices: Illustrations with Chinese and Nigerian Household Surveys," Cahiers de recherche 0806, CIRPEE.
    3. Xiaohua Li & Yaohui Zhao & Lili Lu, 2008. "Effects of Education on Earnings Inequality in Urban China: 1988-2003," Working Papers PMMA 2008-09, PEP-PMMA.

    More about this item

    Keywords

    Poverty; Inequality;

    JEL classification:

    • D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement
    • D64 - Microeconomics - - Welfare Economics - - - Altruism; Philanthropy; Intergenerational Transfers

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