Content Type: Working Paper / Publishing Institution: United Nations University / Publication Year: within 25 Years / Topic: Poverty

1. Migration out of poverty: The case of post-war migration in Mozambique

Author:: Maimuna Ibraimo and Eva-Maria Egger
Publication Date:: 01-2023
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: Internal migration plays an important role in the economic development of individuals, their families, and their country. This study describes Mozambique’s most common migration patterns from 1992 until 2017 using data from three population censuses. We focus on the most important moves between regions, provinces, and rural and urban areas. Further, we document the characteristics of migrants to assess selection patterns. In the final step, we estimate the relationship between migration and multidimensional poverty by applying inverse probability weighted regression adjustment (IPWRA). We find that migration in Mozambique was very high, especially between rural areas, after the war ended as people returned from displacement. Still, it is very low in the most recent period. Recently, migration has been the main contributor to the urbanization of the greater Maputo area (capital city). Migrants appear to be positively selected on education, and are, on average, less likely to be poor.
Topic:: Migration, Poverty, Displacement, Rural, Economic Development, and Post-Conflict
Political Geography:: Africa and Mozambique

2. Programme-135: addressing poverty and inequality in Viet Nam

Author:: Tung Duc Phung and Thanh Minh Pham
Publication Date:: 06-2022
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: Viet Nam has achieved remarkable economic growth and poverty reduction since the Doi Moi. However, ethnic minorities and the ethnic majority do not benefit equally from the national economic progress. The proportion of poor households that are ethnic minority-headed soared from 18 per cent in the early 1990s to 56 per cent in 2008. The disparity exists in their access to crucial basic infrastructure and public services, including transportation, education, healthcare, electricity supply, markets, and justice services. Initiated in 1998, Programme-135 targets the most vulnerable communities and aims to promote production, increase access to basic facilities, improve education, and raise awareness for better living standards. The programme addresses typical causes of poverty among ethnic minorities and inequality between these groups and the majority. Programme-135 has created positive impacts and successfully improved the lives of the beneficiaries. In this paper we provide an overview of the programme and examine the drivers of its success in reducing poverty and bridging the majority–minority development gap. We also discuss the limitations and lessons from the programme.
Topic:: Poverty, Minorities, Inequality, and Ethnicity
Political Geography:: Vietnam and Southeast Asia

3. Poverty, inequality, and growth: trends, policies, and controversies

Author:: Ines A. Ferreira, Vincenzo Salvucci, and Finn Tarp
Publication Date:: 04-2022
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: Reducing poverty and inequality and promoting inclusive growth are fundamental to achieving the United Nations Sustainable Development Goals. Much has changed in the global economy in recent decades and perspectives on progress made vary widely. This is even more so in light of the ongoing COVID-19 pandemic. However, getting to grips in a meaningful manner with existing trends is critical to evidence-based policy-making. This contribution aims to provide an original review and evaluation of the main stylized facts concerning poverty, inequality, and growth. It will uncover existing trends, put controversies into perspective, and help to provide a platform for informed policy debate.
Topic:: Poverty, Inequality, Sustainable Development Goals, and Economic Growth
Political Geography:: Global Focus

4. The effectiveness of social protection in five African countries through normal times and times of crisis

Author:: Katrin Gasior, Iva V. Tasseva, and Gemma Wright
Publication Date:: 12-2022
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: We study the effectiveness of social protection benefits in reducing income and consumption poverty in five sub-Saharan African countries—Ghana, Mozambique, Tanzania, Uganda, and Zambia—in normal times and times of widespread economic crisis. Using tax–benefit microsimulation models with representative household survey data, first we estimate the coverage of benefits and their poverty-reducing effects in each country. Second, we study the ability of benefit automatic stabilizers to reduce losses in incomes and consumption in times of crisis, by simulating hypothetical reductions to earnings and employment. Although the coverage of benefits is fairly high in Ghana and Zambia, the poverty-reducing impact of benefits in all five countries is low in normal times. The effectiveness of benefits to stabilize income and consumption in times of crisis is also limited because many benefits are linked to proxies of income, not income itself, or have tight eligibility criteria. Social assistance programmes are typically unresponsive to losses in household earnings and employment and provide limited support for unemployed people.
Topic:: Poverty, Crisis Management, Economic Crisis, and Income
Political Geography:: Uganda, Africa, Mozambique, Tanzania, Zambia, and Ghana

5. Inclusion amid ethnic inequality: Insights from Brazil’s social protection system

Author:: Natasha Borges Sugiyama
Publication Date:: 07-2022
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: Policy frames in Brazil have long run up against conflicting visions and understandings about the causes and consequences of group-based inequality. This paper argues that a class-based lens has dominated the social protection framework. In recent years, political leaders have framed social policy measures along ‘universal’ class lines with the aim of improving poverty and wellbeing. This framing is reflective of Brazil’s national narrative on race relations and the idea that class and employment status have been the most salient barriers to social welfare protections. Brazil’s widely well-regarded anti-poverty conditional cash transfer programme, Bolsa Família (2003–21), is emblematic of the country’s universal and ‘race-blind’ approach to social policy. But given the strong correlation in Brazil between ethnicity and income, social protection policies such as the Bolsa Família have indirectly targeted vulnerable black and brown citizens. The analysis addresses how social policy has contributed advances to wellbeing in general and for Afro-Brazilians. A comparative perspective on social welfare systems offers important lessons on how poverty relief can further human development and enhance agency. Future reformers can learn from Brazil’s pursuit of poverty reduction alongside administrative procedures that identify vulnerable groups, as a strategy to address intersectional inequalities of ethnicity and class.
Topic:: Poverty, Race, Inequality, and Welfare
Political Geography:: Brazil and South America

6. Multidimensional poverty in Vietnam: Evidence from a rural household survey

Author:: Hoang Xuan Diem and Tran Van Hoang
Publication Date:: 10-2018
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: For years, the international development community has been considering poverty as a multidimensional phenomenon, which takes into account not only income or consumption of the poor, but also their access to basic needs (education, health, etc.) and resources (credit, social network, etc.). In Vietnam, since 2016, the Government has adopted the multidimensional approach to thoroughly measure poverty. This paper is an attempt to assess the state and evolution of multidimensional poverty in the rural areas of Vietnam, using data from the Vietnam Access to Resources Household Survey 2008–16. Results show remarkable improvement of the living conditions in the rural areas, with a greater pace shown among the ethnic minority groups. However, there need to be more efforts to reduce the gap in poverty headcount ratios among Kinh and non-Kinh groups, households with male and female heads, and among households in different provinces. Some of the main suggestions to reduce multidimensional poverty in Vietnam is to increase households’ access to health care services, education, clean water and hygienic latrines, and to improve the presence of such service providers near the households’ locations.
Topic:: Poverty, Minorities, Rural, and Survey
Political Geography:: Vietnam and Southeast Asia

7. Poverty and wellbeing impacts of microfinance: What do we know?

Author:: Mathilde Maîtrot and Miguel Niño-Zarazúa
Publication Date:: 11-2017
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: Over the last 35 years, microfinance has been generally regarded as an effective policy tool in the fight against poverty. Yet, the question of whether access to credit leads to poverty reduction and improved wellbeing remains open. To address this question, we conduct a systematic review of the quantitative literature of microfinance’s impacts in the developing world, and develop a theory of change that links inputs to impacts on several welfare outcomes. Overall, we find that the limited comparability of outcomes and the heterogeneity of microfinance-lending technologies, together with a considerable variation in socio-economic conditions and contexts in which impact studies have been conducted, render the interpretation and generalization of findings intricate. Our results indicate that, at best, microfinance induces short-term dynamism in the financial life of the poor; however, we do not find compelling evidence that this dynamism leads to increases in income, consumption, human capital and assets, and, ultimately, a reduction in poverty.
Topic:: Development, Poverty, Developing World, Finance, and Microeconomics
Political Geography:: Global Focus

8. Does women’s empowerment affect the health of children? The case of Mozambique

Author:: Joseph Deutsch and Jacques Silber
Publication Date:: 12-2017
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: In developing countries, women’s decisions concerning their children’s health depend on ‘empowerment’ concerning decision-making, husband/partner’s use of violence, woman’s attitude towards this violence, available information, and resources. We derive an empowerment indicator using the ‘fuzzy sets’ and Alkire and Foster approaches to multidimensional poverty measurement. The health of children is a latent variable; their height and weight are observed health indicators. We apply the ‘MIMIC’ approach to the 2009 Mozambique Demographic and Health Survey. Children’s health is better when the woman opposes her partner’s violence, the higher her education and body mass index, among female children, and in urban areas.
Topic:: Demographics, Health, Poverty, Children, Women, and Empowerment
Political Geography:: Africa and Mozambique

9. Growth, Inequality, and Poverty Reduction in Developing Countries

Author:: Augustin Kwasi Fosu
Publication Date:: 01-2011
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: The study presents recent global evidence on the transformation of economic growth to poverty reduction in developing countries, with emphasis on the role of income inequality. The focus is on the period since the early/mid-1990s when growth in these countries as a group has been relatively strong, surpassing that of the advanced economies. Both regional and country-specific data are analysed for the US$1.25 andUS$2.50 level poverty headcount ratios using the most recent World Bank data. The study finds that on average income growth has been the major driving force behind both the declines and increases in poverty. The study, however, documents substantial regional and country differences that are masked by this 'average' dominant growth story. While in the majority of countries growth was the major factor behind falling...
Topic:: Development, Economics, Poverty, and Third World
Political Geography:: United States

10. Thailand's Development Strategy and Growth Performance

Author:: Peter Warr
Publication Date:: 01-2011
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: Thailand's development strategy has been strongly market-oriented and open to trade and investment flows with the rest of the world. Since the late 1950s, its growth performance has been outstanding. Poverty incidence has declined dramatically, but economic inequality has increased. Economic progress has been reflected in very significant improvement in non-economic indicators of well-being such as life expectancy, infant and maternal morality, and literacy. Nevertheless, the performance of the education system is chronically poor. Environmental problems and institutional failures in resource management are ongoing. Reform is needed in several areas, including political and corporate governance, regulation of industry, and in the education and health systems.
Topic:: Development, Economics, Education, Emerging Markets, Poverty, and Foreign Direct Investment
Political Geography:: Asia and Southeast Asia

11. Sensitivity of Loan Size to Lending Rates

Author:: Samuel Kobina Annim
Publication Date:: 01-2011
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: This paper examines the combined effect of interest rates and poverty levels of microfinance clients on loan size. Cross section data on 2,691 clients and non-clients households from Ghana is used to test the hypothesis of loan price inelasticity. Quantile regression and variants of least squares methods that explore endogeneity are employed. We find the expected inverse relationship only for the 20th to 40th quantile range. The semi-elasticity of loan amount responsiveness to a unit change in interest rate is more than proportionate and significant for the poorest group only. Market segmentation based on poverty level is suggested in targeting and sustaining microfinance clients.
Topic:: Development, Economics, Markets, Poverty, and Foreign Aid
Political Geography:: Africa

12. Latin American Urban Development into the 21st Century

Author:: Ravi Kanbur, Dennis Rodgers, and Jo Beall
Publication Date:: 01-2011
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: This paper argues for a more systemic engagement with Latin American cities, contending it is necessary to reconsider their unity in order to nuance the 'fractured cities' perspective that has widely come to epitomise the contemporary urban moment in the region. It begins by offering an overview of regional urban development trends, before exploring how the underlying imaginary of the city has critically shifted over the past half century. Focusing in particular on the way that slums and shantytowns have been conceived, it traces how the predominant conception of the Latin American city moved from a notion of unity to a perception of fragmentation, highlighting how this had critically negative ramifications for urban development agendas, and concludes with a call for a renewed vision of Latin American urban life.
Topic:: Development, Poverty, and Urbanization
Political Geography:: Latin America

13. Significance of Public Space in the Fragmented City: Designing Strategies for Urban Opportunities in Informal Settlements of Buenos Aires City

Author:: Flavio Janches
Publication Date:: 03-2011
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: This article surveys the problem of urban marginalization by one of its more critical expressions in the contemporary city: the slums. The aim is to define an urban design strategy for the integration of those settlements as part of the city context, which enables to find solutions for the conflict improving these communities quality of life.
Topic:: Poverty, Sociology, and Urbanization

14. Irregular Urbanization as a Catalyst for Radical Social Mobilization: The Case of the Housing Movements of São Paulo

Author:: Lucy Earle
Publication Date:: 03-2011
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: This study focuses on the city of São Paulo, Brazil and examines the ways in which irregular and illegal growth have influenced the collective action of social movements of the urban poor. The study describes how São Paulo grew as a socially segregated city during the twentieth century due to calculated neglect on the part of the municipal authorities. Highlighting the city's sociospatial inequality, degradation of the central districts and widespread irregularity, it illustrates how these factors have both negatively affected the urban poor and provided a catalyst for social mobilization.
Topic:: Poverty, Social Stratification, Social Movement, and Urbanization
Political Geography:: South America and Latin America

15. Explaining Poverty Evolution: The Case of Mozambique

Author:: Channing Arndt, M. Azhar Hussain, E. Samuel Jones, Virgulino Nhate, Finn Tarp1, and James Thurlow
Publication Date:: 03-2011
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: Measuring poverty remains a complex and contentious issue. This is particularly true in sub-Saharan Africa where poverty rates are higher, information bases typically weaker, and the underlying determinants of welfare relatively volatile. This paper employs recently collected data on household consumption in Mozambique to examine the evolution of consumption poverty with focus on the period 2002/03 to 2008/09. The paper contributes in four areas. First, the period in question was characterized by major movements in international commodity prices. Mozambique provides an illuminating case study of the implications of these world commodity price changes for living standards of poor people. Second, a novel 'backcasting' approach using a computable general equilibrium model of Mozambique, linked to a poverty module.
Topic:: Human Welfare and Poverty
Political Geography:: Africa

16. Asset-Based Poverty in Rural Tajikistan: Who Climbs out and Who Falls in?

Author:: Oleksiy Ivaschenko and Cem Mete
Publication Date:: 03-2008
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: Tajikistan's rural sector has witnessed substantial development since the country began to emerge from civil conflict in 1999. Gross agricultural output increased 64 per cent from 1999 to 2003, and there were significant developments in the agricultural reform agenda. This paper uses the panel component of two surveys conducted in Tajikistan at one-year interval (2003 and 2004) to explore the major determinants of the transition out of/into poverty of rural households. Poverty status is measured in the asset space, thus indicating structural rather than transitory poverty movements. The empirical analysis reveals several interesting findings that are also important from a policy perspective: first, cotton farming seems to have no positive impact on poverty levels, nor on mobility out of poverty. Second, the rate of increase in the share of private farming at the district level had little impact on poverty levels and poverty mobility.
Topic:: Demographics, Development, and Poverty
Political Geography:: Asia and Tajikistan

17. Global Growth and Distribution: Are China and India Reshaping the World?

Author:: Dominique van der Mensbrugghe, Maurizio Bussolo, Rafael E. De Hoyos, and Denis Medvedev
Publication Date:: 03-2008
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: Over the past 20 years, aggregate measures of global inequality have changed little even if significant structural changes have been observed. High growth rates of China and India lifted millions out of poverty, while the stagnation in many African countries caused them to fall behind. Using the World Bank's LINKAGE global general equilibrium model and the newly developed Global Income Distribution Dynamics (GIDD) tool, this paper assesses the distribution and poverty effects of a scenario where these trends continue in the future. Even by anticipating a deceleration, growth in China and India is a key force behind the expected convergence of per capita incomes at the global level. Millions of Chinese and Indian consumers will enter into a rapidly emerging global middle class—a group of people who can afford, and demand access to, the standards of living previously reserved mainly for the residents of developed countries. Notwithstanding these positive developments, fast growth is often characterized by high urbanization and growing demand for skills, both of which result in a widening of income distribution within countries. These opposing distributional effects highlight the importance of analysing global disparities by taking into account—as the GIDD does—income dynamics between and within countries.
Topic:: Development, Economics, and Poverty
Political Geography:: Africa, China, India, and Asia

18. Globalization, Literacy Levels, and Economic Development

Author:: Alok Bhargava
Publication Date:: 01-2008
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: This paper estimated models for GDP growth rates, poverty levels, and inequality measures for the period 1990–2000 using data on 54 developing countries at five-yearly intervals. Issues of globalization were investigated by analysing the differential effects of the countries' exports and imports and by postulating trans-logarithmic models that allow for non-linear effects of literacy levels and measures of openness. The main findings were that literacy rates affected growth rates in a quadratic manner and countries with higher literacy were more likely to benefit from globalization. Second, the model for growth rates showed non-linear and differential effects of the export/GDP and import/GDP ratios. Third, the models indicated that population health indicators such as life expectancy were important predictors of GDP growth rates. Fourth, models for poverty measures showed that poverty was not directly affected by globalization indicators. Finally, the model for Gini coefficients indicated significant effects of 'medium' and 'high' skilled labour work force, with higher proportions of high-skilled labour implying greater inequality.
Topic:: Development, Education, International Trade and Finance, and Poverty

19. Individual and Collective Resources and Health in Morocco

Author:: Marie-Claude Martin
Publication Date:: 03-2008
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: The interaction between available individual and collective resources in the determination of health is largely ignored in the literature on the relationship between poverty and health in developing countries. We analyse the role public resources play in the perception that rural women in Morocco have of their health. These resources are taken to contribute directly and indirectly to the improvement of individual health by, on the one hand, providing a health-promoting environment and, on the other, improving the individual's ability to produce health. The empirical results of multilevel models confirm the expected associations between socioeconomic status, individual vulnerability factors and health. Furthermore, the random part of the model suggests that variation in state of health is also associated with the presence of collective resources. However, the higher the level of women's individual wealth, the less the characteristics of the community in which they live seem to be associated with their health, and the less the potential vulnerability factors seem to constrain their ability to maintain or improve health. Our results suggest that collective investments derived from various areas of activity will be more favourable to improving health, insofar as they are adapted to the initial capacity of women to benefit from them.
Topic:: Gender Issues, Health, and Poverty
Political Geography:: Africa and Morocco

20. Measuring Vulnerability and Poverty: Estimates for Rural India

Author:: Raghav Gaiha and Katsushi Imai
Publication Date:: 04-2008
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: This paper measures the vulnerability of households in rural India, based upon the ICRISAT panel survey. We employ both ex ante and ex post measures of vulnerability. The latter are decomposed into aggregate and idiosyncratic risks and poverty components. Our decomposition shows that idiosyncratic risks account for the largest share, followed by poverty and aggregate risks. Despite some degree of risk-sharing, the landless or small farmers are vulnerable to idiosyncratic risks, forcing them to reduce consumption. Income-augmenting policies therefore must be combined with those that not only reduce aggregate and idiosyncratic risks but also build resilience against them.
Topic:: Demographics, Development, Economics, and Poverty
Political Geography:: India and Asia

21. Minimum Wages, Globalization, and Poverty in Honduras

Author:: T.H. Gindling and Katherine Terrell
Publication Date:: 03-2008
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: To be competitive in the global economy, some argue that Latin American countries need to reduce or eliminate labour market regulations such as minimum wage legislation because they constrain job creation and hence increase poverty. On the other hand, minimum wage increases can have a direct positive impact on family income and may therefore help to reduce poverty. We take advantage of a complex minimum wage system in a poor country that has been exposed to the forces of globalization to test whether minimum wages are an effective poverty reduction tool in this environment. We find the net effect of minimum wage increases in Honduras is the reduction of extreme poverty, with an elasticity of -0.18, and all poverty, with an elasticity of -0.10 (using the national poverty lines). These results are driven entirely by the effect on workers in large private sector firms, where minimum wage legislation is enforced. Increases in the minimum do not affect the incidence of poverty among workers in sectors where minimum wages are not enforced (small firms) or do not apply (self-employed and public sector). Hence, we show that minimum wages can be used as a poverty reduction tool in the formal sector. However, we do not endorse minimum wages as the best tool as we have not carried out a complete cost-benefit analysis of this policy vis-à-vis others.
Topic:: Poverty
Political Geography:: Latin America, Central America, and Honduras

22. Natural Disasters and Remittances: Exploring the Linkages between Poverty, Gender, and Disaster Vulnerability in Caribbean SIDS

Author:: Marlene Attzs
Publication Date:: 06-2008
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: This paper explores the linkages between poverty and disaster vulnerability in the context of remittance flows to households in the Caribbean. Jamaica is used as the case study country. The paper discusses the channels through which natural disasters and remittances affect each other but also reviews the distribution of female-headed households in Jamaica as a percentage of households living below the poverty line and seeks to identify whether flows of remittances alleviate the post-disaster living conditions of such households.
Topic:: Disaster Relief, Gender Issues, Health, and Poverty
Political Geography:: Caribbean and Jamaica

23. Remittances and Vulnerability to Poverty in Rural Mexico

Author:: Alejandro de la Fuente
Publication Date:: 02-2008
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: International remittances have been portrayed as the human face of globalization given their potential to alleviate poverty by directly increasing household income. Using a panel of rural households in Mexico from October 1998 to November 2000 this study assesses whether this is in fact the case. However, rather than examining whether transfers income would reduce future consumption poverty we asked if transfers are likely to reach people whose conditions are prone to worsen in the future. We used vulnerability to consumption poverty to quantify the extent to which risks and the more permanent disadvantages embedded in most rural livelihoods, can translate into future declines in well-being. We found, contrary to our expectations, a negative and statistically significant relationship between the remittance of transfers, including foreign remittances, and the threat to future poverty that rural households could experience.
Topic:: Globalization and Poverty
Political Geography:: Mexico

24. Seasonal Migration and Early Childhood Development

Author:: Karen Macours and Renos Vakis
Publication Date:: 04-2008
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: This paper provides unique evidence of the positive consequences of seasonal migration for investments in early childhood development. We analyse migration in a poor shockprone border region in rural Nicaragua where it offers one of the main household income diversification and risk coping strategies. IV estimates show, somewhat surprisingly, that mother's migration has a positive effect on early cognitive development. We attribute these findings to changes in income and to the intrahousehold empowerment gains resulting from mother's migration, which offset potential negative ECD effects from temporary lack of parenting. This paper, hence, illustrates how increased opportunities in seasonal migration due to higher South–South mobility might positively affect early childhood development and as such long term poverty reduction.
Topic:: Health, Migration, and Poverty
Political Geography:: Nicaragua

25. Vulnerability, Trust and Microcredit: The Case of China's Rural Poor

Author:: Calum G. Turvey and Rong Kong
Publication Date:: 05-2008
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: This paper investigates the economic conditions of rural households in China. Historical survey data indicate that over 80 per cent of rural households earn less than 4,500 yuan in net disposable income each year, that for the vast majority of rural households disposable income is insufficient to meet food consumption needs, and that in terms of economic growth rural households are receiving an ever decreasing percentage of China's growing economy with rural household incomes being only 31 per cent of urban household income in 2004.
Topic:: Economics and Poverty
Political Geography:: China and Asia

26. Globalization and Smallholders: The Adoption, Diffusion, and Welfare Impact of Non-traditional Export Crops in Guatemala

Author:: Paul Winters, Angeli Kirk, Benjamim Davis, and Calogero Carletto
Publication Date:: 02-2008
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: As developing countries continue on the path of economic liberalization, there is a compelling need to ensure that the benefits of globalization reach poor rural communities. Increased commercialization of agriculture and diversification into nontraditional exports (NTXs) is one strategy that has often been advocated as a way for developing countries to use their comparative advantage in lower labor costs and to achieve growth in the agricultural sector. Given the predominantly rural nature of most developing countries and the preponderance of poor people in these areas, high-value agricultural production is considered the ideal mechanism to extend the benefits of globalization directly to the rural poor:1 Allowing poor farmers to shift into the export sector and take advantage of internationally demand driven prices that are higher relative to traditional crops may reduce inequality while fostering overall economic growth (Nissanke and Thorbecke 2007).
Topic:: Agriculture, Development, Globalization, International Trade and Finance, and Poverty
Political Geography:: Global Focus

27. Minimum Wages, Globalization, and Poverty in Honduras

Author:: T. H. Gindling and Katherine Terrell
Publication Date:: 03-2008
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: To be competitive in the global economy, some argue that Latin American countries need to reduce or eliminate labor market regulations such as minimum wage legislation because they constrain job creation and hence increase poverty. On the other hand, minimum wage increases can have a direct positive impact on family income and may therefore help to reduce poverty. We take advantage of a complex minimum wage system in a poor country that has been exposed to the forces of globalization to test whether minimum wages are an effective poverty reduction tool in this environment. We find that minimum wage increases in Honduras reduce extreme poverty, with an elasticity of -0.18, and all poverty, with an elasticity of -0.10 (using the national poverty lines). These results are driven entirely by the effect on workers in large private sector firms, where minimum wage legislation is enforced. Increases in the minimum do not affect the incidence of poverty in sectors where minimum wages are not enforced (small firms) or do not apply (self-employed and public sector).
Topic:: Globalization, Political Economy, Poverty, and Labor Issues
Political Geography:: Global Focus

28. Housing Privatization and Household Wealth in Transition

Author:: Ruslan Yemtsov
Publication Date:: 01-2007
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: All countries in transition experienced increases in inequality. They have also undertaken massive privatization of key asset housing, often on give-away terms. Are these two phenomena related? Has transfer of ownership rights to residents slowed down the inequality increases or it pushed it up? Surprisingly little is known in this area. This paper attempts to provide empirical evidence to start answering these questions. It shows how housing privatization affected the distribution of personal wealth and inequality in current consumption based on recent representative household surveys from three transition countries: Poland, Russia and Serbia. Survey data are compared with figures derived from national accounts and housing statistics. Contrary to common belief and some earlier evidence of strong equalizing effect of housing distribution in Eastern Europe and the former Soviet Union, the paper finds that the contribution of housing to the overall inequality levels is not strong, and is not universally progressive. There is also a significant variation across countries. In Russia and Serbia progressive. There is also a significant variation across countries. In Russia and Serbia features of privatization programmes resulted in better off households capturing more valuable housing assets on extremely beneficial terms, while in Poland privatization and housing reform led to more equitable outcomes. When owner occupied housing rents and durables are properly accounted for, the effects of housing ownership on inequality in current consumption are mildly progressive in Russia and Poland and regressive in Serbia. The paper argues that the information collected by regular household surveys provides only a starting point to study housing wealth distribution, and there are a number of gaps which should be addressed through improved data collection.
Topic:: Civil Society, Development, Economics, and Poverty
Political Geography:: Russia, Poland, and Serbia

29. Poverty, Pro-Poor Growth and Mobility: A Decomposition Framework with Application to China

Author:: Guanghua Wan and Yin Zhang
Publication Date:: 12-2006
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: This paper proposes a framework for incorporating longitudinal distributional changes into poverty decomposition. It is shown that changes in the Sen-Shorrocks-Thon index over time can be decomposed into two components—one component reflects the progressivity of income growth among the original poor, the other measures the extent of downward mobility experienced by the incumbent poor. The decomposition is applied to appraising poverty trends in China between 1988 and 1996. The results indicate that the proposed decomposition can complement the widely-used growthdistribution decomposition in providing insights into poverty dynamics.
Topic:: Development and Poverty
Political Geography:: China and Asia

30. Poverty Reduction in China: Trends and Causes

Author:: Guanghua Wan and Yin Zhang
Publication Date:: 12-2006
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: Applying the Shapley decomposition to unit-record household survey data, this paper investigates the trends and causes of poverty in China in the 1990s. The changes in poverty trends are attributed to two proximate causes; income growth and shifts in relative income distribution. The Foster-Greer-Thorbecke measures are computed and decomposed, with different datasets and alternative assumptions about poverty lines and equivalence. Among the robust results are: (i) both income growth and favourable distributional changes can explain China's remarkable achievement in combating poverty in rural areas in the first half of the 1990s; (2) in the second half of the 1990s, both rural and urban China suffered from rapidly rising inequality and stagnant income growth, leading to a slow-down in poverty reduction, even reversal of poverty trend.
Topic:: Development, Economics, and Poverty
Political Geography:: China and Asia

31. Credit Constraints as a Barrier to Technology Adoption by the Poor: Lessons from South-Indian Small-Scale Fishery

Author:: Xavier Giné and Stefan Klonner
Publication Date:: 09-2006
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: We study the diffusion of a capital intensive technology among a fishing community in south India and analyze the dynamics of income inequality during this process. We find that lack of asset wealth is an important predictor of delayed technology adoption. During the diffusion process, inequality follows Kuznets' well-known inverted U-shaped curve. The empirical results imply that redistributive policies favouring the poor result in accelerated economic growth and a shorter duration of sharpened inequality.
Topic:: Development, Poverty, and Science and Technology
Political Geography:: India and Asia

32. The Public Distribution Systems of Foodgrains and Implications for Food Security: A Comparison of the Experiences of India and China

Author:: Guanghua Wan and Zhang-Yue Zhou
Publication Date:: 09-2006
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: A comparative study of the public distribution systems of foodgrains in India and China is expected to reveal lessons and experiences that are valuable to policymakers. This is particularly important for developing countries in their endeavour to ensure food security. This paper undertakes such an exercise. The main features and developments of the two public distribution systems are first highlighted. This is followed by a comparative analysis of their similarities and differences. The role of public foodgrain distribution systems in ensuring food security is then evaluated. Finally, policy implications are drawn.
Topic:: Human Welfare and Poverty
Political Geography:: China, India, and Asia

33. Resource-Poor Farmers in South India: On the Margins or Frontiers of Globalization?

Author:: Rimjhim M. Aggarwal
Publication Date:: 09-2006
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: It is often argued that an important reason why globalization may lead to GDP growth but fail to reduce poverty is because the poor are unable to participate in the new market opportunities and are marginalized. In this paper we examine the experience of resource-poor farmers in south India, who participated aggressively in the new market opportunities that opened up with trade reforms. However, these expanded market opportunities failed to improve their welfare. The paper examines why and how this happened.
Topic:: Agriculture, Globalization, and Poverty
Political Geography:: India and Asia

34. Measures of Food Insecurity at the Household Level

Author:: Prasanta K. Pattanaik, Craig Gundersen, and Indranil Dutta
Publication Date:: 08-2006
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: Food insecurity and hunger have traditionally been measured by aggregate food supplies or by variables correlated with food insecurity. Because these measures often poorly reflect individuals' true deprivation, economists have turned to surveys with direct questions about food insecurity. Using these surveys, households have then been classified into broad categories, a classification system which ignores the richness of the multiple questions. In this paper, we propose food insecurity measures, along the lines of the well established poverty measures, which incorporates this richness and allow us to reflect the depth and severity, in addition to the incidence, of food insecurity. Using these indices, we calculate the extent of food insecurity and hunger in the United States. Along with giving a richer picture of food insecurity in the US, these food insecurity measures demonstrates that the ordering of various demographic categories differs depends on the choice of measure.
Topic:: Civil Society, Economics, Human Welfare, and Poverty
Political Geography:: United States

35. The Impacts of Growth and Inequality on Rural Poverty in China

Author:: Guanghua Wan and Yin Zhang
Publication Date:: 08-2006
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: This paper analyzes the evolution of poverty in China from the late 1980s to the late 1990s, employing a version of Shapley decomposition tailored to unit-record household survey data. The changes in poverty trends are attributed to two proximate causes— income growth and shifts in income distribution. Different datasets, poverty lines, poverty measures, and equivalence scales are used to examine the robustness of the results. Potential biases arising from ignoring differential regional prices and inflation are also investigated. Notwithstanding some ambiguities in the results, it is consistently found that rural poverty increased in the second half of the 1990s and adverse distributional changes are the main cause.
Topic:: Demographics, Development, and Poverty
Political Geography:: China and Asia

36. Household Financial Assets in the Process of Development

Author:: Patrick Honohan
Publication Date:: 08-2006
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: Systematic information on household financial asset holdings in developing countries is very sparse; we review some available data and current policy debates. Although financial asset holdings by households are highly concentrated, deeper financial systems are correlated with improved income distribution. For low-income countries, the relevant question for poor households is not how much financial assets they have, but whether they have any access to financial products at all. Building on and synthesizing disparate data collection efforts by others, we produce new estimates of access percentages for over 150 countries. Across countries, access is negatively correlated with poverty rates, but the correlation is not a robust one, thus the supposed anti-poverty potential of financial access remains econometrically elusive. Despite policy focus on the value of credit instruments, it is deposit products that tend to be the first to be used as prosperity increases, before more sophisticated savings products and borrowing.
Topic:: Civil Society, Development, Economics, and Poverty

37. Widening Gap of Educational Opportunity? A Longitudinal Study of Educational Inequality in China

Author:: Min-Dong Paul Lee
Publication Date:: 06-2006
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: This study attempts to convey an accurate and dynamic account of educational inequality in China during the last decade. The study finds that there is clear evidence of rapid expansion of education, and younger students all over China are benefiting from the expansion. One of the most notable achievements is the virtual elimination of gender bias against girls in educational attainment. However, analysis of province-level school enrolment data over the last decade shows evidence of persistent regional inequality of educational attainment. Students from inland provinces continue to face strong structural inequality in educational opportunity, and this structural inequality becomes more pronounced as they progress to higher grades. Moreover, inter-cohort analysis reveals that the inter-provincial inequality in upper grades is increasing for younger cohort of students, meaning that educational inequality in China is deteriorating further. Lastly, a decomposition analysis shows that the causes of inter-provincial educational inequality are quite complex and cannot simply be explained by the urban-bias hypothesis that is often suggested as the main source of income inequality.
Topic:: Education, Human Rights, and Poverty
Political Geography:: China and Asia

38. How Should We Measure Global Poverty in a Changing World?

Author:: Kuan Xu and Lars Osberg
Publication Date:: 06-2006
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: Before effective anti-poverty policy can be designed and implemented, the extent, trend and distribution of poverty must be identified. In this sense, poverty measurement is a crucial intermediate step in public policymaking and development planning. This paper asks whether the estimated proportion of the world's population with income below US$1 (adjusted according to purchasing power parity) per day is a good measure of trends in global poverty. We argue that the answer depends on two important issues in the measurement of poverty—the definition of the poverty line, and how best to summarize the level of poverty In this paper, we survey the literature on poverty measurement, demonstrate the importance of considering poverty incidence, depth and inequality jointly, present a simple but powerful graphical representation of the Sen and SST indices of poverty intensity (the poverty box) which is the FGT index of order 1 and extend our empirical work to China using the commonly accepted international poverty line definition of one half median equivalent income.
Topic:: International Relations, Development, and Poverty
Political Geography:: China and Asia

39. Poverty Accounting by Factor Components: With an Empirical Illustration Using Chinese Data

Author:: Guanghua Wan
Publication Date:: 06-2006
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: The purpose of this paper is to develop two poverty decomposition frameworks and to illustrate their applicability. A given level of poverty is broadly decomposed into an overall inequality component and an overall endowment component in terms of income or consumption determinants or input factors. These components are further decomposed into finer components associated with individual inputs. Also, a change in poverty is decomposed into components attributable to the growth and redistributions of factor inputs. An empirical illustration using Chinese data highlights the importance of factor redistributions in determining poverty levels and poverty changes in rural China.
Topic:: Development, Economics, and Poverty
Political Geography:: China and Asia

40. Asia's Labour-Driven Economic Development, Flying-Geese Style: An Unprecedented Opportunity for the Poor to Rise?

Author:: Terutomo Ozawa
Publication Date:: 06-2006
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: The notion of 'shared growth' was introduced by the World Bank in recognition of East Asia's rapid growth accompanied by poverty reduction. It emphasizes the criticality of pro-poor policies and institutional setups in the fast-developing East Asian economies. The efforts of these individual countries are, however, a necessary but not sufficient condition (explanation). There is a more essential, underlying region-wide mechanism that simultaneously promotes regionalized growth and specifically favours Asia's working mass of unskilled labour. Such an efficacious mechanism is posited in the 'flying-geese paradigm of comparative advantage recycling in labour-intensive goods'. The paper argues that a number of favourable factors have fortuitously coalesced to engender a considerably favourable condition for Asia's rapid catch-up growth in which unskilled labour (the poor) can participate as their countries' most vital input in labour-driven development.
Topic:: Development, Economics, and Poverty
Political Geography:: East Asia and Asia

41. Threshold Estimation on the Globalization-Poverty Nexus: Evidence from China

Author:: Zhicheng Liang
Publication Date:: 06-2006
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: China has experienced rapid integration into the global economy and achieved remarkable progress in poverty reduction over the last two decades. In this paper, by employing panel data covering twenty-five Chinese provinces over the period of 1986- 2002, and applying the endogenous threshold regression techniques, we empirically investigate the globalization-poverty nexus in China, paying particular attention to the nonlinearity of the impact of globalization on the poor. Estimation results provide strong evidence to suggest that there exists a threshold in the relationship between globalization and poverty: globalization is good for the poor only after the economy has reached a certain threshold level of globalization.
Topic:: Economics, Globalization, and Poverty
Political Geography:: China and Asia

42. Pro-Poor Growth: The Asian Experience

Author:: Hyun H. Son and Nanak Kakwani
Publication Date:: 06-2006
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: This paper looks into the interrelation between economic growth, inequality, and poverty. Using the notion of pro-poor growth, this study examines to what extent the poor benefit from economic growth. First, various approaches to defining and measuring pro-poor growth are scrutinized using a variety of criteria. It is argued that the satisfaction of a monotonicity axiom is a key criterion for measuring pro-poor growth. The monotonicity axiom sets out a condition that the proportional reduction in poverty is monotonically an increasing function of the pro-poor growth measure. This paper proposes a pro-poor growth measure that satisfies the monotonicity criterion. This measure is called the 'poverty equivalent growth rate', which takes into account both the magnitude of growth and how the benefits of the growth are distributed to the poor and the non-poor. As the new measure satisfies the criterion of monotonicity, it is indicative that to achieve a rapid poverty reduction, the poverty equivalent growth rate ought to be maximized rather than the actual growth rate. The methodology developed in the paper is then applied to Asian countries, including the Republic of Korea, Thailand, and Vietnam.
Topic:: Development, Economics, and Poverty
Political Geography:: Asia, Vietnam, Korea, and Thailand

43. From Seers to Sen: The Meaning of Economic Development

Author:: Wayne Nafziger
Publication Date:: 01-2006
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: The paper compares perspectives on the meaning of development in the late 1970s and early 1980s to the contemporary period, with a focus on the works of Dudley Seers and Amartya Sen. Both men were critical of the development literature of their times. Seers was especially critical of neoclassicism's universal claims and economic growth as the prime objective. For Sen, development involves reducing deprivation or broadening choice. One challenge for future work is for development economists, similar to Seers and Sen, to be more holistic, integrating economic development, human rights, and conflict reduction.
Topic:: Development, Economics, and Poverty

44. Evaluating Targeting Efficiency of Government Programmes: International Comparisons

Author:: Hyun H. Son and Nanak Kakwani
Publication Date:: 05-2006
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: This paper suggests how the targeting efficiency of government programmes may be better assessed. Using the 'pro-poor policy' (PPP) index developed by authors, the study investigates the pro-poorness of not only government programmes geared to the poorest segment of the population, but also basic service delivery in education, health and infrastructure. This paper also shows that the targeting efficiency for a particular socioeconomic group should be judged on the basis of a 'total-group PPP index', to capture the impact of operating a programme within the group. Using micro-unit data from household surveys, the paper presents a comparative analysis for Thailand, Russia, Vietnam and 15 African countries.
Topic:: International Relations, Economics, Government, and Poverty
Political Geography:: Africa, Russia, Vietnam, and Thailand

45. Finance and Poverty in Ethiopia: A Household Level Analysis

Author:: Alemayehu Geda, Daniel Zerfu, and Abebe Shimeles
Publication Date:: 05-2006
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: In this paper, using the rich household panel data of urban and rural Ethiopia that covers the period from 1994 to 2000, we attempted to establish the link between finance and poverty in Ethiopia. Our results show that access to finance is an important factor in consumption smoothing and hence poverty reduction. We also found evidence for a poverty trap due to liquidity constraints that limits the ability of the rural households from consumption smoothing. The empirical findings from this study could inform finance policies aimed at addressing issues of poverty reduction.
Topic:: Development, Economics, and Poverty
Political Geography:: Africa and Ethiopia

46. A Quest for Pro-Poor Globalization

Author:: Erik Thorbecke and Machiko Nissanke
Publication Date:: 05-2006
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: While the opportunities offered by globalization can be large, the question is often raised whether the actual distribution of gains is fair and, in particular, whether the poor benefit proportionately less from globalization and could under some circumstances actually be hurt by it. The paper discusses channels and transmission mechanisms through which the process of globalization affects different aspects and dimensions of poverty in the developing world. It examines how these numerous channels interact, as the net effects on poverty depend on the relative strength of the positive and negative forces of globalization. On the basis of our analysis of these transmission mechanisms from globalization to the world's poor, the paper discusses what may constitute a policy framework for encouraging globalization to be pro-poor.
Topic:: Development, Globalization, Human Welfare, and Poverty

47. Trade Liberalization, Environment and Poverty: A Developing Country Perspective

Author:: M.S. Quresh
Publication Date:: 04-2006
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: This paper revisits the pollution haven hypothesis in the context of Pakistan by offering a systematic analysis of its trade and production patterns. Using bilateral trade statistics from 1975-2003, we test the hypotheses that Pakistan's net exports of pollutionintensive products have increased to the OECD countries. We also investigate if the stringency of environmental governance in the importing countries plays a role in determining Pakistan's exports of pollution-intensive products. The results reveal that there has been a change in the composition of output and exports towards pollutionintensive manufacturing that parallels the opening of the economy. Overall, the findings appear to be in favour of the pollution haven hypothesis and call for effective environmental policy response for poverty alleviation and sustainable development.
Topic:: Development, International Trade and Finance, and Poverty
Political Geography:: Pakistan and Asia

48. Globalization and Rural Poverty: A Perspective from a Social Observatory in the Philippines

Author:: Yujiro Hayami
Publication Date:: 04-2006
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: Using a rice village in the Philippines as a social observatory, the impacts of modernization forces under globalization on rural poverty are assessed based on data collected from recurrent household surveys over the past three decades. After cultivation frontiers closed in the early 1950s relentless population increases continued to press hard on limited land resources in this village. This pauperizing force was counteracted to some extents by the development of irrigation systems followed by the diffusion of modern high-yielding varieties of rice. However, the much more important factor that prevented poverty incidence from increasing and income inequality from worsening was identified as the expansion of non-farm employment opportunities resulting from the increased integration of this village with wide urban and foreign markets. This finding does not lend support to the popular assertion that the encroachment of markets into traditional agrarian communities tends to result in greater inequality and misery of the poor.
Topic:: Agriculture, Globalization, and Poverty
Political Geography:: Southeast Asia

49. Economic Development Strategy, Openness and Rural Poverty: A Framework and China's Experiences

Author:: Justin Yifu Lin and Peilin Liu
Publication Date:: 04-2006
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: This paper argues that both openness and poverty in a country are endogenously determined by the country's long-term economic development strategy. Development strategies can be broadly divided into two mutually exclusive groups: (i) the comparative advantage-defying (CAD) strategy, which attempts to encourage firms to deviate from the economy's existing comparative advantages in their entry into an industry or choice of technology; and (ii) the comparative advantage-following (CAF) strategy, which attempts to facilitate the firms' entry into an industry or choice of technology according to the economy's existing comparative advantages.
Topic:: Development, Economics, and Poverty
Political Geography:: China and Asia

50. Globalization and the Urban Poor in China

Author:: Guanghua Wan and Yin Zhang
Publication Date:: 04-2006
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: This paper examines the distributional impact of globalization on the poor in urban China. Employing the kernel density estimation technique, we recovered from irregularly grouped household survey data the income distribution for 29 Chinese provinces for 1988-2001. Panels of the income shares of the poorest 20, 10 and 5 per cent of the urban residents were then compiled. In a fixed-effect model, two of the central conclusions of Dollar and Kraay (2002)—that 'the incomes of the poor rise equi-proportionately with average income' and that trade openness has little distributional effect on poverty—were revisited. Our results lend little support to either of the Dollar-Kraay conclusions, but instead indicate that average income growth is associated with worsening income distribution while globalization in general, and trade openness in particular, raises the income shares of the poor. It is also found that openness to trade and openness to FDI have differential distributional effects. The beneficial effect of trade was not restricted to the coastal provinces only, but also weakened significantly after 1992. These findings are robust to allow for nonlinearity in the effect of globalization and to control for the influence of several other variables.
Topic:: Economics, Globalization, and Poverty
Political Geography:: China and Asia

51. Globalization, Growth and Poverty in India

Author:: Arup Mirtra and N.R. Bhanumurthy
Publication Date:: 04-2006
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: In this paper an attempt is made to assess the impact of economic reforms on the incidence of poverty by decomposing the change in poverty ratio between two time points into growth/mean effect, inequality effect and the population shift effect. Based on the National Sample Survey data an analysis has been carried out for two time periods: (i) 1983 to 1993-94 and (ii) 1993-94 to 1999-2000, broadly representing the pre-reform and reform-period respectively, for the rural and urban areas of the fifteen major states, and also for the all-India level. The growth/mean effect, which determines the extent of fall (rise) in poverty incidence due to rise (fall) in mean per capita consumption expenditure, dominates in both the periods over the inequality effect, that estimates the rise (fall) in poverty due to rise (fall) in inequality. It also dominates over the population shift effect, which assesses the net impact on all-areas combined poverty, of a decline (rise) in rural (urban) poverty caused possibly by rural-urban migration. The growth effect, which is beneficial for poverty reduction, seems to have gone up in the reform period. The adverse inequality effect also fell in magnitude in the second period compared to the first. States with a greater beneficial growth effect in the second period relative to the first, also show a fall in the magnitude of an adverse population shift effect in the urban areas, i.e., a relatively less rise in the incidence of urban poverty caused by rural-urban migration.
Topic:: Development, Globalization, and Poverty
Political Geography:: India and Asia

52. The Burden of Government Debt in the Indian States: Implications for the MDG Poverty Target

Author:: Indranil Dutta
Publication Date:: 04-2006
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: In this paper we explore what impact, if any, government debts have on achieving the Millennium Development Goals for the Indian states. To fulfill the goals, national governments, especially in the developing world, have to undertake major investments in the social sector; but how much they will really be able to do so will depend on the conditions of their finances. For the Indian states we find that government investment in the social sector is extremely important to reduce poverty, but the government's debt burden is actually stopping several states from attaining the MDG targets. Although, in the medium term the impact of the debt on poverty is not very harmful, in the longer run it has a significant negative impact. Therefore for policy purposes reduction in debt should be given a priority.
Topic:: Debt, Government, and Poverty
Political Geography:: India and Asia

53. Measuring Pro-Poor Progress towards the Non-Income Millennium Development Goals

Author:: Stephen Klasen, Kenneth Harttgen, and Melanie Grosse
Publication Date:: 04-2006
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: In order to track progress in MDG1 and explicitly link growth, inequality, and poverty reduction, several measures of 'pro-poor growth' have been proposed in the literature and used in applied academic and policy work. These measures, particularly the ones derived from the growth incidence curve, allow a much more detailed assessment of the distributional impact of growth and its link to poverty reduction. However, there are no corresponding measures for tracking the distribution of progress in non-income dimensions of poverty, and thus the distribution of progress towards MDGs 2-7. In this paper, we propose to extend the pro-poor growth measurement to non-income dimensions of poverty (particularly health and education). We empirically illustrate the approach for Bolivia and show that it allows a much more detailed assessment of progress towards MDGs 2-7 by focusing on the distribution of progress. Furthermore, this extension also allows an explicit assessment of the linkage between progress in MDG1 and MDGs 2-7 as well as extends traditional incidence analysis by quantifying outcomes in non-income dimensions of poverty along the income distribution.
Topic:: Development, Economics, and Poverty
Political Geography:: Europe and Bolivia

54. Do We Need a New "Great Transformation"? Is One Likely?

Author:: Frances Stewart
Publication Date:: 04-2006
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: Karl Polanyi wrote The Great Transformation in 1944 which analysed the double movement Europe experienced, from a situation where the market was heavily regulated and controlled in the eighteenth century to a virtually unregulated market in the nineteenth century, and the huge transformation in which the market was once more brought under control as a reaction to the poverty, unemployment and insecurity brought about by the unregulated market. Yet in both developed and developing countries there has since been a reaction with a new move towards the market. This paper analyses such processes in contemporary developing countries, and considers whether, in the light of the consequences of the unregulated market, a new Great Transformation is needed. It also considers whether such a transformation is likely, reviewing moves towards increased regulation of the market, and also the challenges faced by any contemporary great transformation arising from globalization and the nature of politics.
Topic:: Development, Markets, and Poverty
Political Geography:: Europe

55. The Poverty Macroeconomic Policy Nexus: Some Short-run Analytics

Author:: George Mavrotas and S. Mansoob Murshed
Publication Date:: 12-2005
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: The present paper utilises a short-run theoretical macroeconomic model of a small open economy to look at the impact of macroeconomic policies and financial deepening upon poverty through sectoral changes. This is because an expansion in certain sectors may cause greater poverty reduction. The model involves a non-traded and a traded sector on the formal side of the economy. The former is more capital intensive and the latter more unskilled labour intensive. Increased employment in the traded sector is more pro-poor compared to a similar rise in the non-traded sector as the former draws workers out of poverty in the informal sector. The model in our paper analyses short-run effects of devaluation, a rise in the money supply induced by financial deepening, and taxation to discourage non-traded goods consumption. Financial deepening can induce greater output and reduce poverty. Other results are mixed and taxonomic. We also attempt to differentiate between the stylised experiences of East Asia and Latin America. East Asian economies have relied more heavily on labour-intensive manufactured exports, whereas Latin America has had a relatively greater share of capital intensive and natural resource based exports. In recent decades countries in these two regions have had differing experiences in poverty reduction, with poverty arguably declining more in East Asia.
Topic:: International Relations, Development, Economics, and Poverty
Political Geography:: East Asia and Latin America

56. Financial Sector Development, Savings Mobilization and Poverty Reduction in Ghana

Author:: Peter Quartey
Publication Date:: 12-2005
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: The paper primarily investigates the interrelationship between financial sector development and poverty reduction in Ghana. This is done using time-series data from the World Development Indicators from 1970-2001. The main findings are, first, that even though financial sector development does not Granger-cause savings mobilization in Ghana, it induces poverty reduction; and second, that savings do Granger-cause poverty reduction in Ghana. Also, the effect of financial sector development on poverty reduction is positive but insignificant. This is due to the fact that financial intermediaries in Ghana have not adequately channelled savings to the pro-poor sectors of the economy because of government deficit financing, high default rate, lack of collateral and lack of proper business proposals. Another interesting finding is that there is a long-run co integration relationship between financial sector development and poverty reduction.
Topic:: Development, Economics, and Poverty
Political Geography:: Africa and Ghana

57. Consistent Testing for Poverty Dominance

Author:: Bram Thuysbaert and Ricardas Zitikis
Publication Date:: 12-2005
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: If uncertainty exists over the exact location of the poverty line or over which measure to use to compare poverty between distributions, one may want to check whether poverty dominance holds. We develop a consistent statistical test to test the null of poverty dominance against the alternative of nondominance. Dominance criteria corresponding to absolute and relative poverty measures are dealt with. The poverty line is allowed to depend on the income distribution. A bootstrap procedure is proposed to estimate critical values for the test. Our results cover both independent and paired samples.
Topic:: Demographics, Development, Economics, and Poverty

58. Poverty Measurement and Theories of Beneficence

Author:: S. Subramanian
Publication Date:: 10-2005
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: This note points to certain similarities of orientation and outcome between Derek Parfit's quest for a theory of beneficence and Amartya Sen's quest for a suitable real-valued representation of poverty. It suggests th at both projects, in a certain sense, have been instructive failures. Using Sen's own work, the note also suggests a logically natural way of dealing with some of the problems in poverty measurement reviewed in it—but only to reject this way out on other compelling grounds.
Topic:: Demographics, Development, Economics, and Poverty

59. Reckoning Inter-group Poverty Differentials in the Measurement of Aggregate Poverty

Author:: S. Subramanian
Publication Date:: 09-2005
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: In a heterogeneous population which can be partitioned into well-defined subgroups, it is plausible that the extent of measured aggregate poverty should depend upon the distribution of poverty across the subgroups. A judgment in favour of an equal inter-group distribution of poverty could arise in two ways. In the first approach, equality is upheld as an intrinsic social virtue, and the aggregate measure of poverty, in line with this view, is 'adjusted' to reflect the extent of inter-group disparity in the distribution of poverty that obtains. In the present paper, this approach is examined, with specific reference to the advancement of a diagrammatic aid to analysis called the group poverty profile. In the second approach, equality is upheld for instrumental reasons which arise from the observed fact that any individual's level of deprivation is a function not only of one's own income, but of the general level of prosperity of the group to which one is affiliated. Individual deprivation functions are specialized to a form which reflects this 'group-affiliation' externality, and the resulting poverty measure is studied with respect to its properties, and its implications for inter-group equity. The analysis is briefly extended to a review of the measurement of literacy, along externality-motivated lines suggested elsewhere by Basu and Foster. The paper concludes that social realism in the measurement of deprivation is often compromised by mainstream approaches to economic theorizing in which both heterogeniety and group-related externalities are generally de-emphasized.
Topic:: Demographics, Economics, Human Welfare, and Poverty

60. Poverty and the Welfare Costs of Risk Associated with Globalization

Author:: Ethan Ligon
Publication Date:: 09-2005
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: 'Globalization' implies change, and uncertainty over future change may affect household welfare. We use data on Lorenz curves over the last fifty years for a sample of 53 (mostly developing) countries. Treating each country-quintile-year as an observation, we first account for variation in consumption expenditures, finding that global shocks are of less importance than country -level shocks in explaining variation in country-quintile consumption growth. While poorer households experience more rapid consumption growth than do wealthier households, they also bear much more risk. However, we find no evidence that this greater risk is related to globalization.
Topic:: Development, Globalization, Human Welfare, and Poverty

61. Why Do Poverty Rates Differ From Region to Region? The Case of Urban China

Author:: Guanghua Wan and Yin Zhang
Publication Date:: 08-2005
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: This paper proposes a semi-parametric method for poverty decomposition, which combines the data-generating procedure of Shorrocks and Wan (2004) with the Shapley value framework of Shorrocks (1999). Compared with the popular method of Datt and Ravallion (1992), our method is more robust to misspecification errors, does not require the predetermination of functional forms, provides better fit to the underlying Lorenz curve and incorporates the residual term in a rigorous way. The method is applied to decomposing variations of urban poverty across the Chinese provinces into three components – contributions by the differences in average nominal income, inequality and poverty line. The results foreground average income as the key determinant of poverty incidence, but also attach importance to the influence of distribution. The regional pattern of the decomposition suggests provincial groupings based not entirely on geographical locations.
Topic:: Demographics, Economics, and Poverty
Political Geography:: China and Asia

62. Out of School and (Probably) in Work: Child Labour and Capability Deprivation in India

Author:: D. Jayaraj and S. Subramanian
Publication Date:: 08-2005
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: This paper explores the hypothesis that the phenomenon of child labour is explicable in terms of poverty that compels a household to keep its children out of school and put them to work in the cause of the househol d's survival. In exploring the link between child labour and poverty in the Indian context, the paper advances the view that the nature of the connection is more readily apprehended if both the variables under study are defined more expansively and inclusively than is customarily the case. Specifically, the suggestion is that it may be realistic to include those children who are conventionally categorized as 'non-workers not attending school' within the count of child labourers. It is also suggested that poverty is meaningfully measured in terms of a multi-dimensional approach to the problem, wherein the aim is to assess generalized capability failure—arising from want of access to elementary infrastructural facilities and essential amenities—with respect to a number of basic human functionings. The core of the paper's argument is presented by means of a simple analytical model of child labour and deprivation, and the issues emerging from it are studied in the Indian context with the support of bot h primary and secondary data.
Topic:: Education, Human Rights, and Poverty
Political Geography:: India and Asia

63. Explaining Threshold Effects of Globalization on Poverty: An Institutional Perspective

Author:: Alice Sindzingre
Publication Date:: 08-2005
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: The paper focuses on the non-linearity of the transmission of the impact of globalization on poverty and the existence of threshold effects. Institutions constitute a critical factor for the creation of threshold effects in the impact of globalization on poverty. Institutions—their credibility, ability to be transformed by globalization, and the ways they give the poor access to the beneficial effects of globalization—determine whether the benefits of globalization are spread to the poor or are locked in by particular groups. They also determine whether or not the negative shocks associated with globalization are transmitted in an unfettered manner. The paper presents a theory of institutions that distinguishes several components, which evolve differently and explain the threshold effects that institutions generate upon the impact of globalization on the poor. The paper then shows that social institutions and norms have a critical role in the generation of these threshold effects. It finally examines the interactions between social institutions and state policies institutions, which may contribute to the formation of poverty traps.
Topic:: Development, Economics, Globalization, and Poverty

64. Conflicts, Poverty and Human Development in Northern Uganda

Author:: Justine Nannyonjo
Publication Date:: 08-2005
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: The long-running conflict in northern Uganda has led to major violations of human rights against civilians, destruction of infrastructure, reduced access to social services, and paralysed economic activity. Creating peace and fostering reconciliation in the region have not been successful either, thereby hindering development and relief activities, which are further constrained by in sufficient funding, and lack of capacity at the district and community levels. The main challenges for reconstruction in northern Uganda are therefore to: (i) achieve peace and reconciliation (ii) provide basic social services to the affected areas (iii) strengthen government capacity to coordinate development and relief activities and (iv) harmonize interventions by the various stakeholders to achieve increased flexibility and transparency.
Topic:: Conflict Resolution, Economics, and Poverty
Political Geography:: Uganda and Africa

65. Channels and Policy Debate in the Globalization-Inequality-Poverty Nexus

Author:: Erik Thorbecke and Machiko Nissanke
Publication Date:: 06-2005
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: The paper offers a critical literature review of the debate surrounding the globalization-poverty nexus, focusing on channels and linkages through which globalization affects the poor. After introducing four different concepts used to measure trends in world income inequality, it examines first the 'growth' conduit through which globalization affects poverty. Treating inequality as the explicit filter between growth and poverty reduction, the causal chain of openness-growth-inequality-poverty is scrutinized, link by link. The paper then moves on to examine other channels in the globalization-poverty nexus that operate through changes in relative factor and good prices, factor movements, the nature of technological change and diffusion, the impact of globalization on volatility and vulnerability, the worldwide flow of information, global disinflation, and institutions, respectively. The paper concludes with a discussion of strategic policy issues within the context of the globalization debate.
Topic:: International Relations, Economics, Globalization, and Poverty

66. The Volatility of Aid

Author:: George Mavrotas and David Fielding
Publication Date:: 06-2005
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: Issues related to the volatility of aid flows are now becoming crucial in view of their relevance to the achievement of the Millennium Development Goals. The paper examines aid volatility using data for 66 aid recipients over the period 1973-2002. We improve upon earlier work in this important area by disaggregating total aid inflows into sector and programme aid. In this way we avoid focussing on a single aggregate, unlike most previous studies on aid volatility. We also adopt a different methodology to capture aid volatility. The institutional quality of the aid recipient affects the stability of sector aid but not that of programme assistance. Moreover, more open economies, which tend to be smaller and richer, ceteris paribus, are associated with more volatile sector aid flows.
Topic:: International Relations, Economics, International Cooperation, and Poverty

67. A Macro Policy for Poverty Eradication through Structural Change

Author:: Rehman Sobhan
Publication Date:: 03-2005
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: This paper argues that poverty originates in the structural injustices of a social order which incapacitates the poor from participating in the growth generating sectors of the economy and leaves them captives in the so called informal sector, characterized by low productivity and low earning capacity. In such a system the poor remain individualized and hence disempowered which compels them to interface with the market economy on highly inequitable terms which relegates them to the lowest tiers of the value addition chain. The need for a macro-policy designed to eliminate poverty is premised on the argument that poverty originates in the structural features of society which can only be addressed at the macro-level. Policy interventions, to redesign the structural sources of poverty, bring into consideration issues of social, political as well as economic reform.
Topic:: Foreign Policy, Development, Economics, and Poverty

68. Social Groups and Economic Poverty: A Problem in Measurement

Author:: S. Subramanian
Publication Date:: 09-2004
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: This paper points to some elementary conflicts between the claims of interpersonal and intergroup justice as they manifest themselves in the process of seeking a real-valued index of poverty which is required to satisfy certain seemingly desirable properties. It indicates how 'group—sensitive' poverty measures, similar to the Anand-Sen (1995) 'Gender Adjusted Human Development Index' and the Subramanian-Majumdar (2002) 'Group-Disparity Adjusted Deprivation Index', may be constructed. Some properties of a specific 'group-sensitive' poverty index are appraised, and the advantage of having a 'flexible' measure which is capable of effecting a tradeoff between the claims of interpersonal and inter-group equality is spelt out. The implications of directly incorporating group disparities into the measurement of poverty for poverty comparisons and anti-poverty policy are also discussed.
Topic:: Development, Economics, Human Welfare, Poverty, and International Affairs

69. Decomposing Spatial Differences in Poverty in India

Author:: Shatakshee Dhongde
Publication Date:: 08-2004
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: Over the last decade, India has been one of the fastest growing economies, and has experienced considerable decline in overall income poverty. However, in a vast country like India, poverty levels vary significantly across the different states. In this paper, we analyze the differences between poverty at the state and national level, separately for the rural and urban sector, in the year 1999-2000. Instead of following the usual practice of decomposing the changes in poverty over time, we decompose the changes in poverty across regions. Such decomposition reveals that differences in state and national poverty levels were largely explained by differences in the state and national mean income levels. Differences in the state and national distributions of income were less important in explaining spatial differences in poverty. An important policy implication of our results is that states with extremely high levels of poverty would have reduced poverty significantly by raising their mean income levels to the national mean income, instead of changing their distribution of income to match the national income distribution.
Topic:: Demographics, Economics, and Poverty
Political Geography:: India and Asia

70. Commune-Level Estimation of Poverty Measures and its Application in Cambodia

Author:: Tomoki Fujii
Publication Date:: 07-2004
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: In this study, we combined the Cambodian socioeconomic survey for 1997 and the country's population census of 1998 to produce poverty measures at the commune-level in Cambodia using the small-area estimation technique developed by Elbers, Lanjouw and Lanjouw. While there are a number of communes for which the standard errors associated with the estimates are too high, we found that they are on average small enough to be useful. We illustrate the application of poverty maps with reference to education programmes.
Topic:: Economics, Education, and Poverty
Political Geography:: Cambodia and Southeast Asia

71. Foreign Aid Resurgent: New Spirit or Old Hangover?

Author:: Peter Burnell
Publication Date:: 07-2004
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: This study is premised on the view that reports circulating in the 1990s, claiming foreign aid was in terminal crisis, were premature. Aid's reviving fortunes are explained in terms both of a growing awareness of the uneven implications of globalization and the after-effects of the terrorist events of 11 September 2001. However these two 'drivers' make uneasy partners. Furthermore, aid for democratization, argued in the 1990s to be an instrument for indirectly addressing socioeconomic weakness and improving development aid's effectiveness—making it a positive feature in a bleak decade—is increasingly seen as problematic. For now, aid's resurgence should target pro-poor development rather than democratic reform, although the likelihood is that old fashioned determinants of realpolitik will continue to get in the way.
Topic:: International Relations, Economics, Human Welfare, and Poverty

72. Spatial Horizontal Inequality and the Maoist Insurgency in Nepal

Author:: S. Mansoob Murshed and Scott Gates
Publication Date:: 07-2004
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: The Maoist insurgency in Nepal is one of the highest intensity internal conflicts in recent times. Investigation into the causes of the conflict would suggest that grievance rather than greed is the main motivating force. The concept of horizontal or inter-group inequality, with both an ethnic and caste dimension, is highly relevant in explaining the Nepalese civil war. There is also a spatial aspect to the conflict, which is most intense in the most disadvantaged areas in terms of human development indicators and land holdings. Using the intensity of conflict (fatalities) as the dependent variable and HDI indicators and landlessness as explanatory variables, we find that the intensity of conflict across the districts of Nepal is significantly explained by the degree of inequalities.
Topic:: Ethnic Conflict, Human Welfare, and Poverty
Political Geography:: South Asia and Nepal

73. Prospects for 'Pro-Poor' Growth in Africa

Author:: Abebe Shimeles and Arne Bigsten
Publication Date:: 07-2004
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: This paper examines trends in income distribution and its linkages to economic growth and poverty reduction in order to understand the prospects for achieving poverty reduction in Africa. We examine the levels and trends in income distribution in some African countries and calculate pro-poor growth indices. Different growth patterns are simulated for Ethiopia, Uganda, Mozambique, and South Africa. We conclude that the balance between policies aimed at growth and measures aimed at redistribution should depend on the elasticity of the growth-equity tradeoff. We also discuss what the appropriate ingredients of a pro-poor strategy would be in the African setting.
Topic:: Economics, Human Welfare, and Poverty
Political Geography:: Uganda, Africa, South Africa, Mozambique, and Ethiopia

74. Longevity in Russia's Regions: Do Poverty and Low Public Health Spending Kill?

Author:: Oleksiy Ivaschenko
Publication Date:: 06-2004
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: This paper examines the impact of changes in poverty and public health spending on inter-temporal variations in longevity using a unique regional-level dataset that covers 77 regions of Russia over the period 1994-2000. The dynamic panel data model is used as a tool for the empirical analysis. The model is estimated using the Arellano-Bond dynamic panel data estimator. The changes in regional levels of poverty and real per capita public health expenditure are identified to be significant determinants of the variations observed in longevity over time. The empirical results indicate that while male life expectancy responds more strongly than female life expectancy to economic circumstances, the latter appears to be more predisposed to the influence of public health spending. The results support the idea that the (positive) effect of public health spending on life expectancy is larger for those regions that experience higher incidences of poverty. The paper also finds that the financial crisis which hit Russia at the end of 1998 had a significant negative effect on longevity independently of the factors directly related to poverty and public health spending.
Topic:: Human Welfare, Political Economy, and Poverty
Political Geography:: Russia, Europe, and Asia

75. Dynamics of Poverty in Ethiopia

Author:: Abebe Shimeles and Arne Bigsten
Publication Date:: 06-2004
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: This paper addresses issues related to the dynamics of income poverty using unique household panel data for urban and rural areas of Ethiopia covering the period 1994-97. The percentage of households that remained in poverty was twice as large in urban areas as in rural areas. This suggests that income variability is a serious problem in rural areas, while the persistence is a key feature of urban poverty. The paper also discusses household characteristics that are correlated with the incidence of chronic poverty as well as vulnerability to poverty. A strategy that promotes consumption smoothing through say access to credit can work well in rural areas, while income or employment generation are required for poverty alleviation in urban areas.
Topic:: Economics, Human Welfare, and Poverty
Political Geography:: Africa and Ethiopia

76. On the Arbitrariness and Robustness of Multi-Dimensional Poverty Rankings

Author:: Mozaffar Qizilbash
Publication Date:: 06-2004
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: It is often argued that multi-dimensional measures of well-being and poverty—such as those based on the capability approach and related views—are ad hoc. Rankings based on them are not, for this reason, robust to changes in the selection of weights used. In this paper, it is argued that the extent of potential arbitrariness and the range of issues relating to robustness have been underestimated in this context. Several issues relating to both the identification of the poor and the use of dimension-specific data are distinguished. These issues are then discussed in the context of the inter-provincial ranking of poverty in South Africa in 1995-6. It turns out that this ranking is fairly robust, and that some important policy-relevant results about the distinction between 'income'/'expenditure' and 'human' poverty for the South African context are reinforced rather than undermined by checking for robustness. In particular, while KwaZulu Natal is in the best three in terms of the standard expenditure measures for various choices of poverty line, it is third worst in terms of all the multi-dimensional rankings presented here.
Topic:: Economics, Human Welfare, and Poverty
Political Geography:: Africa and South Africa

77. Spatial Inequality and Development in Central Asia

Author:: Kathryn Anderson and Richard Pomfret
Publication Date:: 06-2004
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: This paper focuses on inequality in living standards across oblasts and regions within Kazakhstan, the Kyrgyz Republic, Tajikistan, Turkmenistan and Uzbekistan. Regional inequality is an important area of research and policy development. Inequality in income and consumption are logical outcomes in a market-based economic system. If inequality within countries exists because of barriers to competition, then inequality can foment internal tension, and economic and social development within countries is negatively affected. We examine Living Standards Measurement data from Tajikistan, Kyrgystan, and Kazakhstan and additional survey data from Uzbekistan. We find that the most important explanations for the variation in expenditures per capita in the region are household location, household composition, and education. We find large variation in per capita expenditure by location within each country, and the differences go beyond the simple rural-urban distinction. Family structure is also important, and in all countries, having a university educated household head significantly improves household welfare; expenditures are higher in these households than in households with less educated heads. We examine inequality in access to community services and find that provision of public goods reinforces regional inequality patterns in expenditures that we measure among households. The poorest households are likely to live in communities with the lowest access to public services.
Topic:: Economics, Human Welfare, and Poverty
Political Geography:: Central Asia, Kazakhstan, Kyrgyzstan, Tajikistan, Uzbekistan, and Turkmenistan

78. Trade Liberalization and Spatial Inequality: A Methodological Innovation in Vietnamese Perspective

Author:: Henning Tarp Jensen and Finn Tarp
Publication Date:: 06-2004
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: In this paper we calibrate two static computable general equilibrium (CGE) models with respectively 16 and 5,999 representative households. Aggregated and disaggregated household categories are consistently embedded in a 2000 social accounting matrix for Vietnam, mapping on a one-to-one basis to each other. Distinct differences in poverty assessments emerge when the impact of trade liberalization is analyzed in the two models. This highlights the importance of modeling micro household behavior and related income and expenditure distributions endogenously within a static CGE model framework. Our simulations indicate that poverty will rise following a revenue-neutral lowering of trade taxes. This is interpreted as a worst case scenario, which suggests that government should be proactive in combining trade liberalization measures with a propoor fiscal response to avoid increasing poverty in the short to medium term.
Topic:: Economics, Human Welfare, and Poverty
Political Geography:: Vietnam and Southeast Asia

79. Economic Well-being and Non-economic Well-being: A Review of the Meaning and Measurement of Poverty

Author:: Andrew Sumner
Publication Date:: 04-2004
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: This paper discusses the measurement of poverty and well-being. A historical overview is given of the last fifty years. This is followed by discussion of three groupings of indicators: those measures based primarily on economic well-being; those based on non-economic well-being and composite indicators. It is argued that the choice of indicator should reflect its purpose and that economic measures are best when quick, rough-and-ready, short run, aggregate inferences are required. In contrast, non-economic measures are better when greater depth on medium- or longer-term trends and/or dis-aggregation are required.
Topic:: Demographics, Economics, Human Welfare, and Poverty

80. Well-being and the Complexity of Poverty: A Subjective Well-being Approach

Author:: Mariano Rojas
Publication Date:: 04-2004
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: This investigation studies human well-being from a subjective well-being approach. On the basis of a Mexican database the investigation shows that there is a weak relationship between subjective well-being and indicators of well-being such as income and consumption. Therefore, subjective well-being provides additional useful information to study human well-being and, in consequence, poverty.
Topic:: Economics, Human Welfare, and Poverty
Political Geography:: Latin America, Central America, North America, and Mexico

81. Income-based Measures of Average Well-being

Author:: Steve Dowrick
Publication Date:: 03-2004
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: Internation comparisons of average national incomes omit important information about leisure, home production, health, etc. They are also bedevilled by index number problems. This paper suggests ways of combining working hours and life-expectancy with income comparisons, and shows that the fixed-price indexes of real income, such as those in the Penn World Table, substantially understate the income gaps between the poorest and richest countries.
Topic:: Demographics, Economics, Human Welfare, and Poverty

82. Subjective Measures of Well-being

Author:: Ruut Veenhoven
Publication Date:: 04-2004
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: This paper deals with three questions: (1) What are 'subjective' measures? (2) What is 'well-being'? and (3) Are subjective measures of well-being of use for policymaking, in particular in developing nations?
Topic:: Development, Human Welfare, and Poverty

83. Human Well-being: Concepts and Conceptualizations

Author:: Des Gasper
Publication Date:: 04-2004
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: Economic measures of income have ignored large areas of human well-being and are poor measures of well-being in the areas to which they attend. Despite increased recognition of those distortions, 'GNP per capita continues to be regarded as the quintessential indicator of a country's living standard' (Partha Dasgupta). Well-being seems to have intuitive plausibility as a concept, but in practice we encounter a bewilderingly diverse family of concepts and approaches, partly reflecting different contexts, purposes, and foci of attention. Is there a unifying framework that yet respects the complexity and diversity of well-being? This paper presents an imperfect comparative and integrative framework that builds on the contributions by Sen and others. We move toward the framework gradually, since well-being concepts are in fact complex entitities which reflect pictures of personhood and of science. Insight grows through surveying a wide range of relevant experience and views, before risking blinkering one's vision in a framework. The paper then uses the framework to examine conceptualizations of human well-being, by Dasgupta, Sen, Nussbaum, Doyal and Gough, and Alkire.
Topic:: Demographics, Development, Human Welfare, and Poverty

84. Gender-related Indicators of Well-being

Author:: Stephan Klasen
Publication Date:: 03-2004
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: This paper discusses the rationale as well as the challenges involved when constructing gender-related indicators of well-being. It argues that such indicators are critically important but that their construction involves a number of conceptual and measurement problems. Among the conceptual issues considered are the space in which gender inequality in well-being is to be measured, whether the indicators should track wellbeing of males and females separately or adjust overall measures of well-being by the gender inequality in well-being, whether gender equality in every indicator is necessarily the goal, how to assess gender inequality that is apparently desired by males and females, and what role indicators of agency or empowerment should play in genderrelated indicators of well-being. Among the most important measurement issues addressed are; the role of the household in allocating resources, the question of stocks versus flows, as well as significant data gaps when it comes to gender inequalities. Where appropriate, remedies to the conceptual and measurement issues are proposed. The paper also briefly reviews UNDP's gender-related indices to illustrate some of the challenges involved.
Topic:: Development, Gender Issues, Human Welfare, and Poverty

85. Conceptual and Measurement Issues in Poverty Analysis

Author:: Erik Thorbecke
Publication Date:: 04-2004
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: The objective of this paper is to review a number of issues related to poverty, while taking stock of the ongoing research. Most of the remaining unresolved issues in poverty analysis are related directly or indirectly to the dynamics of poverty. Before the development community can become more successful in designing and implementing poverty-alleviation strategies, within the context of growth, we need to understand better the conditions under which some households remain permanently (chronically) poor and how others move in and out of poverty. In what follows we review the state of the art under a number of interrelated headings: (1) Chronic vs. transient poverty; (2) Poverty and vulnerability; (3) The determination of the poverty line across time and countries; (4) The quantitative vs. qualitative approach to poverty measurement; and (5) Growth, inequality and poverty.
Topic:: Development, Economics, Human Welfare, and Poverty

86. Inequality and Welfare Evaluation of Heterogeneous Income Distributions

Author:: Anthony Shorrocks
Publication Date:: 01-2004
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: This paper establishes the principles which should govern the welfare and inequality analysis of heterogeneous income distributions. Two basic criteria—the 'equity preference' condition and the 'compensation principle'—are shown to be fundamentally incompatible. The paper favours the latter, thereby vindicating the traditional method of dealing with heterogeneous samples. However, inequality and welfare comparisons will usually be well defined only if equivalent incomes are obtained using constant scale factors; and researchers will need to distinguish clearly between inequality of nominal incomes and inequality of living standards. Furthermore, household observations must always be weighted according to family size.
Topic:: Demographics, Economics, Human Welfare, and Poverty

87. The Rise or Fall of World Inequality: A Spurious Controversy?

Author:: Bart Capéau and André Decoster
Publication Date:: 01-2004
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: In the age of globalization, the question whether inequality in the world rose or fell down, is a hot topic. Leading scholars in the field of economic inequality measurement developed methods to estimate empirically the distribution of welfare (income) amongst world citizens. Despite their similar methodologies, they do not seem to agree about the conclusion. In the present paper we pinpoint what drives the two extreme positions apart. Sala-i-Martin (2002a, b), who claims that there can be no doubt that world inequality went down between the late 1970s and the late 1990s, has in fact calculated population weighted inequality between countries. Milanovic (2002a, b, c) does not deny this, but illustrates the empirical importance of divergent tendencies at the sub-national level (especially urban versus rural regions) for assessing true world inequality and comes to the reverse conclusion. Nevertheless, there seems to be unanimity, especially amongst the contributions quoted here, about the inequality measure(s) to be used for assessing world income distributions. We show that at least for international inequality, there is empirical evidence for rank reversals among the class of generalized entropy measures and expect the same to be true of world inequality. However, the normative debate about which inequality measure to use for assessing true world inequality has not yet begun.
Topic:: Development, Poverty, and Third World

88. Spatial Decomposition of Inequality

Author:: Guanghua Wan and Anthony Shorrocks
Publication Date:: 01-2004
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: This paper reviews the theory and application of decomposition techniques in the context of spatial inequality. It establishes some new theoretical results with potentially wide applicability, and examines empirical evidence drawn from a large number of countries.
Topic:: Development, Globalization, and Poverty

89. Regional or National Poverty Lines? The Case of Uganda in the 1990s

Author:: Simon Appleton
Publication Date:: 12-2003
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: Absolute poverty lines are often derived from the cost of obtaining sufficient calories. Where staples vary across regions, such poverty lines may differ depending on whether they are set using national or regional food baskets. Regional poverty lines are open to the objection that they may be contaminated by income effects. This paper explores this issue by focussing on Uganda, a country where widening spatial inequalities in the 1990s have caused concern. Conflicting results from earlier studies have suggested that the spatial pattern of poverty in Uganda is very sensitive to whether national or regional food baskets are used in setting poverty lines. We confirm this suggestion by comparing the spatial profile of poverty in 1993 using national and regional poverty lines. However, since the regions consuming the more expensive staple sources of calories are also those with higher incomes, using simple regional poverty lines is problematic. Instead, a method of setting regional poverty lines is considered that adjusts for income differentials between regions. Even with this adjustment, the use of regional food baskets implies a markedly different.
Topic:: Development, International Trade and Finance, and Poverty
Political Geography:: Uganda and Africa

90. Which Types of Aid Have the Most Impact?

Author:: George Mavrotas
Publication Date:: 12-2003
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: The paper uses an aid disaggregation approach to examine the impact of different types of aid on the fiscal sector of the aid-recipient country. It uses time-series data on different types of aid (project aid, programme aid, technical assistance and food aid) for Uganda, an important aid recipient in recent years, to estimate a model of fiscal response in the presence of aid which combines aid disaggregation and endogenous aid. The empirical findings clearly suggest the importance of the above approach for delving deeper into aid effectiveness issues since different aid categories have different effects on key fiscal variables—an impact that could not be revealed if a single figure for aid was employed. More precisely, project aid and food aid appear to cause a reduction in public investment whereas programme aid and technical assistance are positively related to public investment. The same applies for government consumption. A negligible impact on government tax and non-tax revenues, and a strong displacement of government borrowing are also found.
Topic:: Economics, International Trade and Finance, and Poverty
Political Geography:: Uganda and Africa

91. A Decomposition Analysis of Regional Poverty in Russia

Author:: Anthony Shorrocks and Stanislav Kolenikov
Publication Date:: 10-2003
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: This paper applies a new decomposition technique to the study of variations in poverty across the regions of Russia. The procedure, which is based on the Shapley value in cooperative game theory, allows the deviation in regional poverty levels from the all- Russia average to be attributed to three proximate sources; mean income per capita, inequality, and local prices. Contrary to expectation, regional poverty variations turn out to be due more to differences in inequality across regions than to differences in real income per capita. However, when real income per capita is split into nominal income and price components, differences in nominal incomes emerge as more important than either inequality or price effects for the majority of regions.
Topic:: Economics and Poverty
Political Geography:: Russia, Europe, and Asia

92. Aid Effectiveness and Selectivity: Integrating Multiple Objectives into Aid Allocations

Author:: Mark McGillivray
Publication Date:: 10-2003
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: This paper surveys recent research on aid and growth. It also provides an overview of research on inter-recipient aid allocation. The overall focus of the paper is on the relevance of these issues for poverty-efficient aid, defined as a pattern of inter-recipient aid allocation which maximises poverty reduction. It identifies a range of poverty- reducing criteria on which aid allocation or selectivity might be based, calling for a broader selectivity framework. The paper argues that this framework should be built on a recognition that the effectiveness of aid in increasing growth, and by implication in reducing poverty, is contingent on a range of factors in addition to the quality of recipient country policy regimes. These factors include political stability, democracy, post conflict reconstruction, and economic vulnerability.
Topic:: Development, Political Economy, and Poverty

93. Reforms, Remoteness and Risk in Africa: Understanding Inequality and Poverty during the 1990s

Author:: Luc Christiaensen, Lionel Demery, and Stefano Paternostro
Publication Date:: 09-2003
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: This study traces the interactions between economic growth, income inequality and consumption poverty in a sample of African countries during the 1990s. It draws on the much-improved household data sets now available in the region. It finds that experiences have varied: some countries have seen sharp falls in income poverty; others have witnessed marked increases. Economic growth has been 'pro-poor' in that the incomes of poor households have typically grown at similar or faster rates than average income. But the aggregate numbers hide significant and systematic distributional effects which have caused some groups and regions to be left behind. The paper explores the contours of these effects, and draws three key conclusions. First, agricultural market liberalization has been conducive to reductions in rural poverty. Second, market connectedness is crucial for poor producers to take advantage of the opportunities offered by economic growth. Some regions and households by virtue of their sheer remoteness have been left behind when growth picks up. The availability of infrastructure (especially roads) and proximity to markets are crucial. And finally risks, such as rainfall variations and ill health are found to have profound effects on poverty outcomes, underscoring the significance of social protection in poverty reduction strategies in Africa.
Topic:: Economics and Poverty
Political Geography:: Africa

94. Quo Vadis? Inequality and Poverty Dynamics across Russian Regions

Author:: Ruslan Yemtsov
Publication Date:: 09-2003
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: This paper analyses regional data on inequality and poverty in Russia during 1994-2000 using published series from the regionally representative Household Budget Survey. The paper finds that the share of inequality in Russia coming from the between-regions component is large (close to a third of the total inequality), growing, and accounts for most of the increase in national inequality over 1994-2000. The paper demonstrates an absence of interregional convergence in incomes across Russian regions using various techniques. On the other hand, the paper finds evidence of convergence in inequality within regions, trended towards an internationally high level. Based on these two findings, the paper projects dynamics of inequality and poverty in Russia over a ten-year time horizon. The projections show that if the observed trend continues, by 2010 the absolute majority of Russia's poor will be concentrated in a few permanently impoverished regions, while relatively more affluent regions will become virtually free of poverty. Finally, the paper relates fluctuations in inequality within regions to a set of factors classified into four broad categories: endowments and initial conditions, preferences, policies, and shocks. Among these factors short-run fluctuations of the unemployment rate are revealed as significant and strong signals of inequality.
Topic:: Demographics, Economics, and Poverty
Political Geography:: Russia, Europe, and Asia

95. Regional Poverty and Income Inequality in Central and Eastern Europe: Evidence from the Luxembourgh Income Study

Author:: Michael Förster, David Jesuit, and Timothy Smeeding
Publication Date:: 09-2003
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: This paper reports levels of income inequality and poverty in four Central and Eastern European countries: the Czech Republic, Hungary, Poland and Russia. Unlike many previous researchers who examine transition economies, we aggregate the detailed individual-level income surveys made available through the efforts of the Luxembourg Income Study at the regional level of analysis. Although national-level investigations have contributed much to our understanding of the income distribution dynamics, these studies mask intracountry variance in levels of income inequality and thus may not capture the true distribution of household income and accurately reflect individual wellbeing. Accordingly, we compute summary measures of inequality and relative poverty rates, using both local and national relative poverty lines, for the most recent waves of data available. We offer comparisons between regional and national median incomes and assess levels of inter- and intraregional income inequality. In addition, we make comparisons to regions within Western European countries and find that, contrary to what is often asserted, interregional disparities in Central and Eastern Europe countries are not as large as those found in some Western European countries.
Topic:: Development and Poverty
Political Geography:: Russia, Europe, Eastern Europe, Poland, Hungary, Czech Republic, and Luxembourg

96. How Responsive is Poverty to Growth? A Regional Analysis of Poverty, Inequality, and Growth in Indonesia, 1984-99

Author:: Jed Friedman
Publication Date:: 08-2003
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: This paper uses six nationally representative household consumption surveys to develop successive poverty profiles for Indonesia over a fifteen-year period of sustained high growth followed by rapid contraction. Adopting a 'cost-of-basic-needs' approach to poverty determination (an approach particularly suited to measures of absolute poverty), this paper develops price indices and calculates poverty lines from unit value data, an oft neglected source of information. The summary findings confirm that Indonesia has witnessed broadbased gains in poverty reduction over the period 1984-96 and then a dramatic reversal during the recent financial crisis. These summary findings, however, mask substantial diversity in growth, inequality, and poverty change across Indonesian regions and so subsequent analysis focuses on the links between growth, inequality, and changes in poverty at the regional level. As opposed to previous studies of poverty change that have used short panels of cross-national data to identify the relationship between growth and poverty, this study employs a longer panel for a single country in order to investigate how poverty change at the provincial level varies with province growth rates and province changes in inequality (while controlling for time invariant province characteristics). The results indicate that poverty change is highly responsive to overall growth. However closer analysis reveals that regional differences in poverty levels persist even after controlling for the effects of provincial income levels, particularly for rural areas. These findings suggest that local factors play an important role in poverty determination and may interact with growth to impact poverty reduction in differing ways across Indonesia. Future investigations will need to take a more careful look at these local determinants of poverty change and attempt to identify the types of growth toward which poverty measures are particularly responsive.
Topic:: Development, Economics, and Poverty
Political Geography:: Indonesia

97. 'Looking at the Other Side of the Coin': The Relationship between Classical Growth and Early Development Theories

Author:: Maiju Perälä
Publication Date:: 04-2003
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: This paper extends the history of thought narrative on Allyn Young to recognize the close relationship that the classical growth theory has with the early development theory, as Young's externalities-fuelled, cumulative growth process influenced the theoretical thought of the early development theory pioneers, Paul Rosenstein-Rodan and Ragnar Nurkse. The conditions that prevent the development of underdeveloped regions, indivisibilities and inelasticities of supplies and demands, represent the breakdown of the conditions that Young highlights as necessary for self-sustaining growth to occur. Hence, Young's cumulative growth process underlies the view of these early development theorists, though their focus is on the malfunctioning and restarting of this process.
Topic:: Development, Economics, Emerging Markets, International Trade and Finance, and Poverty

98. Persistence of Underdevelopment: Does the Type of Natural Resource Endowment Matter?

Author:: Maiju Perälä
Publication Date:: 04-2003
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: This paper examines growth successes and failures across countries and notes the latter's perplexing predominance among ex ante low-income economies. An explanation for this persistence of underdevelopment is proposed through an empirical investigation that brings forth evidence on the importance of natural resource endowment type on growth or, more appropriately, lack of it. The results show that, in the absence of social cohesion, the nature of natural resource abundance bears great significance as a natural resource endowment characterized by oil and/or mineral resources is more negatively correlated with growth than a resource endowment that is agricultural. The robustness of this result is tested across a number of growth regression specifications within the literature.
Topic:: Agriculture, Development, Economics, and Poverty

99. A Tale of Two Countries: Poverty among Immigrants in Denmark and Sweden since 1984

Author:: Kræn Blume, Björn Gustafsson, Peder Pedersen, and Mette Verner
Publication Date:: 04-2003
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: The paper focuses on the problems of low income among immigrants, analysed by using comparable panel datasets for two Scandinavian welfare states. After a brief survey of a few earlier studies on immigrant poverty, we present Denmark and Sweden as interesting cases for comparative research. Cyclical profiles have been very different since the 1980s and both countries have experienced considerable differences with regard to the number and composition of immigrants from the less developed countries. Poverty rates, analysed relative to different background factors, are fairly high, in particular when considering the welfare state background of Denmark and Sweden. A number of differences are found in spite of the institutional similarities between the two countries.
Topic:: Economics, Migration, Political Economy, and Poverty
Political Geography:: Denmark and Sweden

100. Development Cycles, Political Regimes and International Migration

Author:: Andrés Solimano
Publication Date:: 04-2003
Content Type:: Working Paper
Institution:: United Nations University
Abstract:: At the turn of the twentieth century, a large number of Europeans, mostly from Italy and Spain, left their homelands and headed to the distant shores of Argentina in response to the good economic opportunities, fertile land and hopes for a better future that were to be found there. At the time, Argentina was one of the most vibrant world economies. Between 1870 and 1930, around seven million people migrated from Europe to Argentina, although nearly three million returned at some different point during those years. Also foreign capital responded to the opportunities offered by Argentina, and British financial institutions funded an important part of the construction of national infrastructure needed to support growth. In contrast, European migration to Argentina virtually stopped in the 1950s, and in the next 30 years or so the country become a net exporter of professionals who were fleeing economic decline, poor opportunities and authoritarian regimes. Moreover, during this period, financial capital steadily left Argentina looking for safer places. Nowadays, and in contrary to the flow of people a century ago, Argentineans are leaving in large numbers to Spain, Italy and other destinations. Emigration this time is associated with the collapse of the country's currency experiment of the 1990s which left a legacy of massive output decline, high unemployment, financial crisis and lost hopes.
Topic:: Development, Emerging Markets, International Political Economy, Migration, and Poverty
Political Geography:: Europe, Argentina, Spain, and Italy

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COLUMBIA UNIVERSITY PRESS