When is Growth Pro-Poor? Cross-Country Evidence

35 Pages Posted: 14 Feb 2006

See all articles by Aart Kraay

Aart Kraay

World Bank - Development Research Group (DECRG)

Date Written: March 2004

Abstract

Growth is pro-poor if the poverty measure of interest falls. This implies three potential sources of pro-poor growth: (a) a high rate of growth of average incomes; (b) a high sensitivity of poverty to growth in average incomes; and (c) a poverty-reducing pattern of growth in relative incomes. I empirically decompose changes in poverty in a large sample of developing countries into these components. In the medium run, most of the variation in changes in poverty is due to growth, suggesting that policies and institutions that promote broad-based growth should be central to pro-poor growth. Most of the remainder 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 little guidance on policies and institutions that promote these other sources of pro-poor growth.

Keywords: poverty, growth

JEL Classification: I32, O40

Suggested Citation

Kraay, Aart, When is Growth Pro-Poor? Cross-Country Evidence (March 2004). IMF Working Paper No. 04/47. Available at SSRN: https://ssrn.com/abstract=878870

Aart Kraay (Contact Author)

World Bank - Development Research Group (DECRG) ( email )

1818 H. Street, N.W.
MSN3-311
Washington, DC 20433
United States
202-473-5756 (Phone)
202-522-3518 (Fax)

HOME PAGE: http://econ.worldbank.org/staff/akraay

Register to save articles to
your library

Register

Paper statistics

Downloads
230
rank
126,055
Abstract Views
1,362
PlumX Metrics