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.
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.
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 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.
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.
Financial crisis of 2008,a disastrous consequence of weak financial sector performance, affected masses of people all over the globe. This highlighted the significance of financial sector in every economy all over the world. Financial system works quietly in the background, yet contributes a lot in economic development through various channels resulting in employment generation and poverty reduction. Therefore a developed, dynamic, efficient and sustainable financial sector works as a pivot for the economic development of any economy. Over the time Pakistan has passed through many changes to improve its financial system and related economic policies. Those in turn have many repercussions on the economic scene of the country. This book is an effort to provide an answer to the question that either this financial sector development has contributed towards economic development of the country or not? We found working on time series data from 1973 to 2007 related to Pakistan that a developed financial sector blooms not only in human capacity building but also in economic uplift of the country through improving investment and trade and lessening the unemployment rate in the country.
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 book talks about how Malaysia capitalised on its potential to attract FDI, adjusted its policies and legislation to sustain FDI assisted growth while making sure, to a considerable extent, that all parts of the country benefitted from the economic boom. A good lesson, though not perfect, to all developing countries trying to make the most of natural resources and cheap labour while having to manage political instability, racial issues and corruption. It also highlights how the Malaysian government has consistently found compromise between the demands of investors and the need to protect the interests of its poeple to remain an attractive destination for FDI.
In order to find trend in poverty different techniques are employed by different authors resulting in no clear cut outcome in Pakistan.The same story is about inequality estimation.It is necessary to quantify the roles of growth and income redistribution towards changes in poverty in the short and long run.It is also necessary to know whether the growth is pro-poor or not. This study employed the same technique to find poverty,inequality and growth estimates from 1993 to 2006.Rural area experienced more poverty as compared to urban area throughout the period,whereas the results of inequality showed an opposite story.During some periods growth was dominant over adverse income redistribution while for the other years story was opposite to it.For headcount ratio the growth was not pro-poor.Poverty is inversely related with age,education,foreign remittances,sewing machine,livestock and owned land, while it is positively associated with household size.There is positive relationship between inequality and growth.Net elasticity of poverty to growth is less than the gross elasticity of poverty to growth.This study should help the government in tackling poverty and inequality problems.
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
Economic Integration is increasingly felt as an important instrument for better allocation of resources, greater volume of trade and for mutual benefits to the countries involved in such process of unification. ASEAN and SAARC are the two important regional trade blocks in developing Asia. Regional economic integration in terms of trade and investment among the member countries provides a logical response to their common problems of poverty and economic backwardness. Question may arise as to how and to what extent member countries have integrated them in respect of foreign polices and how far they have achieved their cherished goals of human development and poverty reduction. Is there any significant relation between economic integration and poverty reduction? What is the pattern of development in developing Asia? Are they converging in income and human development? What is the role of two Asian Giants, China and India, in this regard? This book has developed a theoretical framework and examined these issues empirically. Hope, this book will benefit the policy makers, researchers, trade analysts and academicians interested in international trade and development.
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.