At present a near consensus exists among social scientists that there is a trade-off between economic growth and poverty reduction. The responsiveness of poverty to economic growth is expressed in terms of growth-elasticity of poverty which is said to be an increasing function of aggregate level of development and decreasing function of inequalities in income. There exist wide differences among the Indian states in terms of the magnitude of growth-elasticity of poverty. The change in income inequality does not seem to have any significant influences on the magnitude of growth-elasticity of poverty. On the other hand, poverty reduction is highly correlated with levels of human development, infrastructure development, and government development expenditure.It is the differences in the development indicators which explain why some states could achieve high poverty reduction with low economic growth, while others could achieve low poverty reduction with high economic growth, and why in spite of identical rates of economic growth extent of poverty reduction differed among the states.
The study examines two parallel hypotheses no. 1 “The relationship between international trade and economic growth” and no. 2 “The relationship between international trade and poverty reduction” in Pakistan. The objective of the first part of the study is to explore the impact of trade liberalization on economic growth with various covariates. The model contains real GDP per capita for economic growth, trade as share of GDP and the control variables such as financial development, government spending, annual inflation, remittances and manufacturing as shares of GDP are also used as determinants of economic growth for the period of 1973 - 2007. The second part of the study investigates the link between international trade and poverty reduction along with several independent variables. The model contains head count ratio for poverty, trade as share of GDP and the other determinants of poverty like real GDP per capita, consumer price index proxy for inflation, total investment, and agriculture as shares of GDP and urbanization as share of total population are also used.
Over the past few decades, the nexus between inflation and economic growth have drawn extensive attention of macroeconomists, policy makers and the central bankers of both developed and developing countries. Much less agreement exists about the precise relationship between inflation and economic performance. This book has reviewed briefly theoretical and empirical findings about the relationship between inflation and economic growth. Moreover, the writer has examined the inflation – investment relationship to assess whether investment is the channel through which inflation and economic growth are related. More specifically, this book has examined their relationship using co-integration and error correction models accompanying with correlation matrix and Granger Causality test for the case of Ethiopia. This analysis should help shed some light on the nexus between inflation and economic growth especially to University students, professionals and policy makers in the area
This volume discusses long-standing, but central, economic issues in Sub-Saharan Africa, including the nature of growth-poverty-inequality relations, agriculture, the labour market and openness, and globalization.
Developing countries are in search of better policies to achieve higher economic growth since growth reduces poverty. Development of financial sector is one of the major economic policies since financial development influences economic growth and reduces poverty. Economic literature over the years has established that a sophisticated stock market is a critical factor for long-run economic growth.Given the importance of stock market for developing countries, this study empirically examines the relationship between stock market development and economic growth using the time-series for India over the period 1980-2008. Second, the study also statistically detects the direction of causality (cause and effect relationship) in a multivariate setting between stock market development and economic growth, which is vital for policy implication. This study provides important channels of stock market-growth linkages which is important for developing countries like India.
The impact of trade policy on poverty explains how trade liberalisation contributed directly or indirectly to poverty and economic growth in Zambia. the study indicates that the approach of trade policy liberalisation was affected by a number of factors such as trade agreements which has created the effect of membership overlapping and therefore making it difficult for country to implement a sound competitive strategy to strengthen its export capability and improve trade investment climate. However, the weakness in trade competitive strategy has impacted the local community in the area of productivity and competitiveness . In the context of poverty reduction strategy, the Poverty Reduction Strategy Paper( PRSP) has indeed ignored the role of economic integration in the poverty reduction agenda, there is need to strengthen and implement effective delivery poverty reduction strategies which have the potential to support the poor so that economic growth is improved and address the issue of inequality within the communities. In the final conclusion, the study highlights that trade liberalisation and poverty reduction are the most important elements of economic development.
This study investigates the nexus between public spending and economic growth in Ethiopia (1971–2010) using an Autoregressive Distributed Lag Model or Bound Testing Approach. In order to determine the direction of causality between public spending and economic growth, Toda and Yamamato (1995) augmented Granger causality test is used. The outcome of the study revealed that, the growth impact of government consumption expenditure in Ethiopia during the study period was negative and significant. However, that of investment spending was positive and significant both in the short run and in the long run, showing the relevance of public physical investment activities to the economy. The test of causality, however, indicated that there was a unidirectional causality running from economic growth to aggregate public spending.
Poverty reduction strategies have been at the center stage of development programmes. Agriculture has been a central element of focus on poverty reduction strategy. Nigerian agriculture is dominated by small scale farmers who produce the bulk of food in the country. The vicious circle of poverty among these farmers largely accounts for unimpressive performance of the agricultural sector. Increasing growth in the agricultural sector is the most efficient means of alleviating poverty and generating long-term sustainable development. Resources must be used much more efficiently, with more attention paid to eliminating waste. The success in achieving broad-based economic growth depends largely on the ability to efficiently utilize the available resources. A very little empirical literature exists on the link between resource use efficiency and poverty reduction among farming households. This book, therefore, provides useful information on poverty and inequality among farming households. This book should help shed some light on the link between resource use efficiency and poverty reduction among farming households, and should be especially useful as a guide for poverty reduction policy.
This is a critical examination of the relative importance of electricity in the economics of growth, poverty reduction and the success of micro-enterprise with a direct impact on livelihood. While not all governments in developing countries seem to acknowledge the importance of the relationship between energy (electricity) and poverty reduction, some do recognize it as an essential link when promoting economic development. This research provides empirical data on the link between electricity and poverty reduction. It considers the role of electricity in poverty reduction through an assessment of the impact of acquiring and continuous access to electricity by micro enterprises and the impact of the changes on the livelihoods of their household. This describes the problem formulation thus: Does acquiring access to electricity have any effect on the viability of micro enterprises (ME) and poverty reduction? The focus is on the changes in the livelihood of the ME. Six main assets are identified as important to the livelihood of ME; human, social, technological, natural, physical and financial assets.
This study examines the likely impact of government expenditure policy on long run growth and poverty, in both rural and urban Nigeria, drawing on insights from research on some sectors in the Nigerian economy on the direct and indirect links between government spending, growth and poverty reduction. The main objective is to simulate if government expenditure in priority areas would help to meet the Millennium Development Goals (MDG) of the United Nations. The study used an integrated sequential dynamic computable general equilibrium (CGE) micro-simulation model to study the potential impact of increasing government expenditure on growth and poverty reduction. The results of experiments indicate that it will be extremely difficult for Nigeria to achieve the Millennium Development Goals (MDG) target, in terms of poverty reduction by the year 2015, because no single policy measure in the analysis is able to meet this goal. This study therefore recommends that in order to promote economic growth and reduce poverty, investment in education and health services should receive the highest priority in the public investment portfolio.
Poverty has been the image associated to Ethiopia by different individuals for the last several years. However, if proper economic policies have been implemented, the current extent of poverty will not be so serious as it is today. This initiated me to write the paper. This work was based on the CGE-Micro Simulation Analysis. Proper Trade policy was found to have significant impact on growth and poverty reduction. This book attempts to address the effect of tariff reduction and tax replacement on growth and poverty If tariff reduction was accompanied by a direct tax replacement, there is marginal effect on growth and poverty reduction. However the industrial sector will be severely affected despite increased income for the agricultural sector. If tariff reduction was accompanied by indirect tax replacement, there would be a worsening effect of poverty and reduced income in general. This was mainly due to the inefficiency on indirect taxation system in Ethiopia. Hence before implementing tariff-indirect tax adjustment, it is crucial to develop the tax system. On the other hand, with no tax replacement, a tariff reduction has a significant effect on growth and poverty reduction.
The relationship between growth, poverty and inequality has become central in development economics due to its significance for poverty reduction. Two school of thoughts emerge, pro-growth and pro-distribution. The growth group favours only the growth led by poverty reduction irrespective of income distribution, the distributionists favour such growth, which makes the income distribution more egalitarian. The purpose of this paper is to establish a link between average per capita income and incomes of poor through poverty elasticity of growth suggested by pro-poor growth literature. It also investigate link between incomes of poor with the globalization and agriculture and find out inequality elasticity. The focus of the paper is the most vulnerable region of the world and Asia. It homes to more than 1.6 Billion population of the world with more than 50 percent living below the standard poverty line. The growth debate in this region is of supreme importance for the development practitioners and governments to rethink of the ongoing and future growth policies for transforming this region more egalitarian and pro-poor.
One of the main problems facing developing nations in the 20th. & 21st. centuries is poverty. Furthermore, due to the strong connection between poverty and organized crimes, terrorism, unlawful migrations, and environment destruction, poverty has become a global problem and forced itself on the agenda of every world conference. Therefore, many researches have been carried out on the role of various subjects in poverty reduction. Amongst them, a research done by Hernando de Soto on the role of ''secured titles'' in poverty reduction: "The Mystery of Capital", (NY: Bantam Press, 2000).Although the world has changed and there is a revolution named "Globalization"( as a result, a national economic growth is effected in one way or another by the economic grow of other nations), no research has ever investigated the role of valuation in poverty reduction. Therefore, this research work investigates the impact of valuation on poverty with the aim to reveal the importance of adopting the International Valuation Standards (IVS) for de Soto''s transformation process of ''dead capital'' into ''active capital'' for the purpose of initializing a sustainable poverty reduction course.