2004年-世界发展银行全球_A_Unified_Framework_for_Pro-Poor____________Growth_Analysis_36页_363kb

Summary of WPS3397: A Unified Framework for Pro-Poor Growth Analysis

Core Content

This paper introduces a unified analytical framework for evaluating pro-poor growth, emphasizing the role of social evaluation criteria and the impact of inequality on poverty reduction. The author, B. Essama-Nssah, argues that whether economic growth is considered pro-poor depends on the evaluative weights assigned to different income groups. The paper presents a new indicator of pro-poor growth, which is a distribution-adjusted growth rate, and demonstrates its application using data from Indonesia in the 1990s.

Main Points

• Pro-Poor Growth and Social Evaluation: Pro-poor growth is defined as economic growth that is favorable to the poor. The paper frames this concept within the logic of social evaluation, where the choice of weights determines the social desirability of growth.

• Evaluation Criteria and Weights: The paper discusses two main approaches to defining social weights:

  • Minimalist Approach: Assumes nonnegative weights and leads to dominance criteria such as the Pareto and Dalton principles.
  • Full Specification: Allows for a unique set of weights that reflect inequality aversion, typically modeled using the Yitzhaki function.

• Pro-Poor Growth Indicators:

  • The growth incidence curve (GIC) is used to assess the distributional impact of growth.
  • The poverty growth curve (PGC) is introduced as a measure based on second-order dominance.
  • A new pro-poor growth indicator, called the equally distributed equivalent growth rate, is proposed. It is a weighted average of the growth incidence curve and depends on the chosen level of inequality aversion.

• Inequality Aversion and Weights:

  • The aversion parameter $ \nu $ determines the degree of inequality aversion.
  • Weights are assigned in a way that reflects the distribution of living standards, with higher weights given to the poorer segments of the population.
  • The cut-off rank for the aversion parameter is derived from the equation $ \nu (1 - p) ^ {\nu - 1} = 1 $, and varies with $ \nu $, placing more emphasis on the poor as $ \nu $ increases.

• Impact of Inequality on Poverty Reduction:

  • Changes in inequality can either enhance or reduce the poverty impacts of growth.
  • The paper illustrates that even with growth, if inequality increases, the poverty reduction effect may be diminished.

• Empirical Illustration: Indonesia (1990s):

  • Indonesia experienced sustained economic growth and poverty reduction in the 1990s, despite initial adverse conditions in the 1980s.
  • The growth incidence curves for 1993–1996 and 1999–2002 lie entirely above zero, indicating unambiguous poverty reduction.
  • The proportion of people living below the international poverty line (about $2.16 per day) decreased from 61.5% in 1993 to 50.5% in 1996.
  • The paper also highlights that absolute and relative indicators of pro-poor growth can lead to conflicting conclusions from the same set of data.

Key Information

• The equally distributed equivalent growth rate is a new indicator that accounts for inequality in the distribution of growth impacts.
• The evaluation framework allows for the incorporation of social preferences and inequality aversion into the measurement of pro-poor growth.
• The Pareto criterion is insufficient for poverty-focused evaluation, as it does not consider inequality.
• The Dalton principle provides a more nuanced approach by assigning higher weights to the poorer individuals.
• The aversion parameter $ \nu $ allows for the calibration of the poverty focus of the evaluation.
• The empirical analysis using Indonesian data shows a strong link between growth and poverty reduction, and that inequality changes have influenced the effectiveness of growth in reducing poverty.
• Growth incidence curves (GIC) and poverty growth curves (PGC) are used to visualize the distributional impact of growth over time.

Conclusion

The paper concludes that pro-poor growth is not solely a function of economic growth but also of how growth affects the distribution of income and well-being. By introducing a new, distribution-adjusted indicator, the paper provides a more comprehensive framework for assessing the poverty implications of growth. The empirical evidence from Indonesia supports the idea that growth can be pro-poor under certain conditions, and that inequality plays a critical role in determining the extent of poverty reduction.