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Does employment generation really matter for poverty reduction ?

Author

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  • Gutierrez, Catalina
  • Orecchia, Carlo
  • Paci, Pierella
  • Serneels, Pieter

Abstract

This paper analyzes how the employment/productivity profile of growth and its sectoral pattern are correlated with poverty reduction. The authors use a sample of 104 short-run growth spells in developing countries, between 1980 and 2001. They also identify some conditions of the labor market and the economic environment that are associated with employment-intensive growth or specific sectoral growth. The results show that, inthe short run, although the aggregate employment-rate intensity of growth does not matter for poverty reduction any more than the aggregate productivity intensity of growth, the sectoral pattern of employment growth and productivity growth is important. Employment-intensive growth in the secondary sector is associated with decreases in poverty, while employment-intensive growth in agriculture is correlated with poverty increases. Similarly, productivity-intensive growth in agriculture is associated with decreases in poverty. Although the study does not address causality, coincidence of these phenomena in this large sample of heterogeneous countries and periods suggests that, in the short run, the sectoral productivity and employment pattern of growth may have important implications for poverty alleviation. Therefore, policies for reducing poverty should not overlook the sectoral productivity and employment implications of different growth policies.

Suggested Citation

  • Gutierrez, Catalina & Orecchia, Carlo & Paci, Pierella & Serneels, Pieter, 2007. "Does employment generation really matter for poverty reduction ?," Policy Research Working Paper Series 4432, The World Bank.
  • Handle: RePEc:wbk:wbrwps:4432
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    References listed on IDEAS

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    Cited by:

    1. Minsoo Lee & Xuehui Han & Raymond Gaspar & Emmanuel Alano, 2018. "Deriving Macroeconomic Benefits from Public–Private Partnerships in Developing Asia," Working Papers id:12888, eSocialSciences.
    2. Rashid Amjad & G. M. Arif & Usman Mustafa, 2008. "Does the Labor Market Structure Explain Differences in Poverty in Rural Punjab?," Lahore Journal of Economics, Department of Economics, The Lahore School of Economics, vol. 13(Special E), pages 139-162, September.
    3. repec:kqi:journl:2017-1-4 is not listed on IDEAS
    4. Prema-chandra Athukorala & Kunal Sen, 2015. "Industrialisation, Employment and Poverty," Departmental Working Papers 2015-11, The Australian National University, Arndt-Corden Department of Economics.
    5. Cho, Yoonyoung & Newhouse, David, 2013. "How Did the Great Recession Affect Different Types of Workers? Evidence from 17 Middle-Income Countries," World Development, Elsevier, vol. 41(C), pages 31-50.
    6. Arias-Vazquez, Francisco Javier & Lee, Jean Nahrae & Newhouse, David, 2012. "The Role of Sectoral Growth Patterns in Labor Market Development," IZA Discussion Papers 6926, Institute for the Study of Labor (IZA).
    7. Puyana, Alicia., 2011. "Economic growth, employment and poverty reduction : a comparative analysis of Chile and Mexico," ILO Working Papers 994629623402676, International Labour Organization.
    8. Gindling, T.H. & Terrell, Katherine, 2010. "Minimum Wages, Globalization, and Poverty in Honduras," World Development, Elsevier, vol. 38(6), pages 908-918, June.
    9. Olu Ajakaiye & Afeikhena T. Jerome & David Nabena & Olufunke A. Alaba, 2015. "Understanding the relationship between growth and employment in Nigeria," WIDER Working Paper Series 124, World Institute for Development Economic Research (UNU-WIDER).
    10. Khanna, Gaurav & Newhouse, David & Paci, Pierella, 2011. "Fewer Jobs or Smaller Paychecks? Aggregate Crisis Impacts in Selected Middle-Income Countries," IZA Discussion Papers 5956, Institute for the Study of Labor (IZA).
    11. World Bank, 2011. "Poverty in Egypt 2008-09 : Withstanding the Global Economic Crisis," World Bank Other Operational Studies 12551, The World Bank.
    12. Khanna, Gaurav & Newhouse, David & Paci, Pierella, 2010. "Fewer Jobs or Smaller Paychecks? Labor Market Impacts of the Recent Crisis in Middle-Income Countries," World Bank - Economic Premise, The World Bank, issue 11, pages 1-4, April.
    13. repec:ilo:ilowps:462962 is not listed on IDEAS
    14. Nicola Pontarollo & Carolina Serpieri, 2017. "The renewal capacity of EU regions," JRC Working Papers JRC109647, Joint Research Centre (Seville site).
    15. Nicola Pontarollo & Carolina Serpieri, 2018. "A composite policy tool to measure territorial resilience capacity," JRC Working Papers JRC111389, Joint Research Centre (Seville site).

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    Keywords

    Achieving Shared Growth; Labor Policies; Rural Poverty Reduction; Labor Markets; Population Policies;

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