C. Journal articles published externally
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These are journal articles by World Bank authors published externally.
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Publication
Purchasing Power Parity Exchange Rates for the Global Poor
( 2011-04)The global poverty count uses a common global poverty line, often referred to as the dollar-a-day line, currently $1.25 at 2005 international prices, whose construction and application depends on purchasing power parity (PPP) exchange rates for consumption. The price indexes that underlie the PPPs used for this purpose are constructed for purposes of national income accounting, using weights that represent patterns of aggregate consumption, not the consumption patterns of the global poor. We use household surveys from 62 developing countries to calculate global poverty-weighted PPPs and to calculate global poverty lines and new global poverty counts. -
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Was Vietnam's Economic Growth in the 1990s Pro-poor? An Analysis of Panel Data from Vietnam
( 2011)International aid agencies and almost all economists agree that economic growth is necessary for reducing poverty, yet some economists question whether it is sufficient for poverty reduction. Vietnam enjoyed rapid economic growth in the 1990s, but a modest increase in inequality during that decade raises the possibility that the poor in Vietnam benefited little from that growth. This article examines the extent to which Vietnam's economic growth has been "pro-poor," giving particular attention to two issues. The first is the appropriate comparison group. When comparing the poorest x% of the population at two points in time, should the poorest x% in the first time period be compared to the poorest x% in the second time period (some of whom were not the poorest x% in the first time period) or to the same people in the second time period (some of whom are no longer among the poorest x%)? The second is measurement error. Estimates of growth among the poorest x% of the population are likely to be biased if income or expenditure is measured with error. Household survey data show that Vietnam's growth has been relatively equally shared across poor and nonpoor groups. Indeed, comparisons of the same people over time indicate that per capita expenditures of the poor increased much more rapidly than those of the nonpoor, although failure to correct for measurement error exaggerates this result. -
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Alleviating Extreme Poverty in Chile: The Short Term Effects of Chile Solidario
( 2011)This paper evaluates the effect of an anti-poverty program, Chile Solidario, during its first two years of operation. We find that the program tends to increases significantly their take-up of cash assistance programs and of social programs for housing and employment, and to improve education and health outcomes for participating households. There is no evidence that the participation to employment program translates into improved employment or income outcomes in the short term. Finally, we provide suggestive evidence of the key role that the psycho-social support had in enabling this change, by increasing awareness of social services in the community as well as households' orientation towards the future. -
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Impacts of the Triple Global Crisis on Growth and Poverty : The Case of Yemen
( 2011)Yemen is an oil-exporting and food-importing country with the highest levels of poverty in the Middle East and North Africa. The impacts of the triple crisis are likely to further complicate pre-existing conditions of conflict, oil depletion and governance failure. Using a dynamic CGE model, this article finds that oil-driven growth in 2008 dominated the negative growth impacts of the food crisis, but that growth was not pro-poor. The financial crisis of 2009 slowed growth sharply and raised the poverty rate to 42.8%, up from 34.8% in 2005/6. Poverty continues to be higher in rural areas, where almost half the population live in poverty. -
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Would Freeing Up World Trade Reduce Poverty and Inequality? The Vexed Role of Agricultural Distortions
( 2011)Trade policy reforms in recent decades have sharply reduced the distortions that were harming agriculture in developing countries, yet global trade in farm products continues to be far more distorted than trade in non-farm goods. Those distortions reduce some forms of poverty and inequality but worsen others, so the net effects are unclear without empirical modelling. This article summarises a series of new economy-wide global and national empirical studies that focus on the net effects of the remaining distortions to world merchandise trade on poverty and inequality globally and in various developing countries. The global Linkage model results suggest that removing those remaining distortions would reduce international inequality, largely by boosting net farm incomes and raising real wages for unskilled workers in developing countries, and would reduce the number of poor people worldwide by 3 per cent. The analysis based on the Global Trade Analysis Project model for a sample of 15 countries, and nine stand-alone national case studies, all point to larger reductions in poverty, especially if only the non-poor are subjected to increased income taxation to compensate for the loss of trade tax revenue. -
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Gender Implications of Biofuels Expansion in Africa : The Case of Mozambique
( 2011)We use a gendered dynamic CGE model to assess the implications of biofuels expansion in a low-income, land-abundant setting. Mozambique is chosen as a representative case. We compare scenarios with different gender employment intensities in producing jatropha feedstock for biodiesel. Under all scenarios, biofuels investments accelerate GDP growth and reduce poverty. However, a stronger trade-off between biofuels and food availability emerges when female labor is used intensively, as women are drawn away from food production. A skills-shortage among female workers also limits poverty reduction. Policy simulations indicate that only modest improvements in women's education and food crop yields are needed to address food security concerns and ensure broader-based benefits from biofuels investments. -
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Business and Human Development in the Base of the Pyramid: Exploring Challenges and Opportunities with Market Heat Maps
( 2011)Roughly a little under half of the world's population is mired in poverty, most in the developing world--about 3 billion people constitute the global base of the economic pyramid. Building on earlier work by Banerjee and Duflo (2007), this paper uses survey data from three countries in order to provide a clear visualization of the spatial dimension of the economic lives of the poor and their access to markets. It develops a framework that could be used to map market inclusiveness, and then applies this to a number of markets that are critical to reducing poverty and increasing human welfare: water, credit and telecommunications. These "market heat maps" help to illustrate the extent of the challenges and in some cases reveal potential opportunities in growing more inclusive markets for the poor. -
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The Two Poverty Enlightenments: Historical Insights from Digitized Books Spanning Three Centuries
( 2011)Word searches of Google's library of digitized books suggest that there have been two "Poverty Enlightenments" since 1700, one near the end of the 18th century and the second near the end of the 20th. The historical literature suggests that only the second came with a widespread belief that poverty could and should be eliminated. After the first Poverty Enlightenment, references to "poverty" (as a percentage of all words) were on a trend decline until 1960, after which there was a striking resurgence of interest, which came with rising attention to economics and more frequent references to both general and specific policies relevant to poverty. Developing countries also became more prominent in the literature. Both Enlightenments came with greater attention to human rights. The written record reflects the push-back against government intervention and the retreat from leftist economics and politics since the late 1970s. Although many debates from 200 years ago continue today, there is little sign that the modern revival of the classical 19th century views on the limitations of government has come with a revival of the complacency about poverty that was common early in that century. -
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Sources of Income Persistence: Evidence from Rural El Salvador
( 2011)This article uses a unique panel data set of rural El Salvador to investigate the main sources of persistence and variability in incomes. Our econometric framework validly reduces a general panel model to a dynamic linear model with a covariance structure that can be estimated efficiently with short panels. We find that life-cycle incomes are largely explained by the productive characteristics of families, such as education and access to public goods, and unobserved heterogeneity. Pure state dependence, arising from income shocks persistency, is of second order. In El Salvador, frequent transitory shocks are a more important source of income variation than in developed countries. -
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Using Pseudo-panels to Measure Income Mobility in Latin America
( 2011)This paper presents a comparative overview of mobility patterns in 14 Latin American countries between 1992 and 2003. Using three alternative econometric techniques on constructed pseudo-panels, the paper provides a set of estimators for the traditional notion of income mobility as well as for mobility around extreme and moderate poverty lines. The estimates suggest very high levels of time-dependent unconditional immobility for the region. However, the introduction of socioeconomic and personal factors reduces the estimate of income immobility by around 30 percent. There are also large variations in country-specific income mobility (estimated to explain some additional 10 percent of inter-temporal income variation). Analyzing the determinants of changes in poverty incidence within cohorts revealed statistically significant roles for age, gender, and education of the household head, the latter subject to distinctive effects across levels of attainment and transition in and out of poverty.