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How Much of Economic Growth Trickles Down to the Population in Resource-Rich Countries ? Evidence from Papua New Guinea

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  • Baxi,Paripoorna
  • Naidoo,Darian
  • Tandon,Sharad Alan

Abstract

There was substantial growth in the resource sector in Papua New Guinea during the last resource boom, increased revenue collection by the government associated with that growth, and significant increases in international assistance, all which might have translated into improved well-being outcomes across the country. For a better understanding of whether these changes improved household-level outcomes, this paper updates estimates of key well-being outcomes in the country. The analysis imputes monetary poverty status using nonmonetary indicators in the 2016 –18 Demographic and Health Survey and estimates the World Bank’s Multidimensional Poverty Measure. Despite the country’s significant growth since 2009, monetary poverty and access to several essential services hardly changed, which stands in stark contrast to the substantial improvement across the rest of the world and other comparison regions over the same period. Combined, the results illustrate that it is possible that very little of resource-led growth trickles down to the population and that the link between macroeconomic and microeconomic outcomes is more tenuous in Papua New Guinea than found in other resource-intensive settings.

Suggested Citation

  • Baxi,Paripoorna & Naidoo,Darian & Tandon,Sharad Alan, 2024. "How Much of Economic Growth Trickles Down to the Population in Resource-Rich Countries ? Evidence from Papua New Guinea," Policy Research Working Paper Series 10798, The World Bank.
    • Handle: RePEc:wbk:wbrwps:10798
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    References listed on IDEAS

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    1. Antonio Savoia & Kunal Sen, 2021. "The Political Economy of the Resource Curse: A Development Perspective," Annual Review of Resource Economics, Annual Reviews, vol. 13(1), pages 203-223, October.
    2. Bazillier, Remi & Girard, Victoire, 2020. "The gold digger and the machine. Evidence on the distributive effect of the artisanal and industrial gold rushes in Burkina Faso," Journal of Development Economics, Elsevier, vol. 143(C).
    3. Emily Schmidt & Rachel Gilbert & Brian Holtemeyer & Kristi Mahrt, 2021. "Poverty analysis in the lowlands of Papua New Guinea underscores climate vulnerability and need for income flexibility," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 65(1), pages 171-191, January.
    4. Rohan Fox & Marcel Schröder, 2018. "After Papua New Guinea's Resource Boom: Is the Kina Overvalued?," Asia and the Pacific Policy Studies, Wiley Blackwell, vol. 5(1), pages 65-76, January.
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