Abstract |
This paper provides an empirical investigation of the poverty-growth nexus and assesses the prospects for poverty alleviation through economic growth. The paper employs a dynamic panel estimator to capture both across- and within-country e?ects, a novel Bayesian Model Averaging robustness analysis to explicitly account for model uncertainty, and the widest possible set of potential determinants to ensure a comprehensive search for super pro-poor policies. The empirical ?ndings are broadly encouraging. Growth does indeed raise the income of the poor, although this relationship is less than one-to-one, in sharp contrast with previous results. One implication is that simply focusing on economic growth as a strategy to lower poverty may actually leave the poor worse o? relative to the average population. More encouraging is the evidence on the existence of a set of policies and conditions which are super pro-poor, namely lower in?ation, lower government consumption, higher levels of ?nancial sector development and higher educational status.
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