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When is growth pro-poor? Cross-country evidence, Volume 1
 
Author:Kraay, Aart; Country:World;
Date Stored:2004/06/04Document Date:2004/03/01
Document Type:Policy Research Working PaperSubTopics:Poverty Reduction Strategies; Achieving Shared Growth; Governance Indicators; Health Monitoring & Evaluation; Economic Conditions and Volatility; Inequality; Services & Transfers to Poor; Public Health Promotion
Language:EnglishRegion:The World Region
Report Number:WPS3225Collection Title:Policy, Research working paper ; no. WPS 3225
Volume No:1  

Summary: Growth is pro-poor if the poverty measure of interest falls. According to this definition there are three potential sources of pro-poor growth: (1) a high rate of growth of average incomes; (2) a high sensitivity of poverty to growth in average incomes; and (3) a poverty-reducing pattern of growth in relative incomes. The author empirically decomposes changes in poverty in a large sample of developing countries during the 1980s and 1990s into these three components. In the medium to long run, most of the variation in changes in poverty can be attributed to growth in average incomes, suggesting that policies and institutions that promote broad-based growth should be central to the pro-poor growth agenda. Most of the remainder of the variation in poverty is due to poverty-reducing patterns of growth in relative incomes, rather than differences in the sensitivity of poverty to growth in average incomes. Cross-country evidence provides relatively little guidance as to the policies and institutions that promote these other sources of pro-poor growth.

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