Does Employment Generation Really Matter for Poverty Reduction?

46 Pages Posted: 20 Apr 2016

See all articles by Catalina Gutierrez

Catalina Gutierrez

World Bank

Carlo Orecchia

Fondazione Eni Enrico Mattei (FEEM); CMCC - Centro Euro-Mediterraneo sui Cambiamenti Climatici

Pierella Paci

World Bank

Pieter M. Serneels

University of Oxford - Centre for the Study of African Economies (CSAE)

Date Written: December 1, 2007

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, in the 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.

Keywords: Achieving Shared Growth, Labor Policies, Rural Poverty Reduction, Labor Markets, Population Policies

Suggested Citation

Gutierrez, Catalina and Orecchia, Carlo and Paci, Pierella and Serneels, Pieter M., Does Employment Generation Really Matter for Poverty Reduction? (December 1, 2007). World Bank Policy Research Working Paper Series, Vol. , pp. -, 2007. Available at SSRN: https://ssrn.com/abstract=1067301

Catalina Gutierrez

World Bank ( email )

Washington, DC 20433
United States

Carlo Orecchia

Fondazione Eni Enrico Mattei (FEEM) ( email )

C.so Magenta 63
Milano, 20123
Italy

CMCC - Centro Euro-Mediterraneo sui Cambiamenti Climatici ( email )

via Augusto Imperatore, 16
Lecce, I-73100
Italy

Pierella Paci

World Bank ( email )

Washington, DC 20433
United States

Pieter M. Serneels (Contact Author)

University of Oxford - Centre for the Study of African Economies (CSAE) ( email )

Oxford OX1 3UL
United Kingdom

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