Publication: Inequality Is Bad for the Poor
Loading...
Files in English
626 downloads
Published
2005
ISSN
Date
2012-06-26
Author(s)
Editor(s)
Abstract
It has been argued that inequality should be of little concern in poor countries on the grounds that 1) absolute poverty in terms of consumption (or income) is the overriding issue in poor countries and 2) the only thing that really matters to reducing absolute income poverty is the rate of economic growth. The author takes 1) as given but questions 2). He argues that there are a number of ways in which the extent of inequality in a society, and how it evolves over time, influences the extent of poverty today and the prospects for rapid poverty reduction in the future.
Link to Data Set
Citation
“Ravallion, Martin. 2005. Inequality Is Bad for the Poor. © World Bank. http://hdl.handle.net/10986/9141 License: CC BY 3.0 IGO.”
Associated URLs
Associated content
Other publications in this report series
Journal
Journal Volume
Journal Issue
Collections
Related items
Showing items related by metadata.
Publication Inequality is Bad for the Poor(World Bank, Washington, DC, 2005-08)It has been argued that inequality should be of little concern in poor countries on the grounds that (1) absolute poverty in terms of consumption (or income) is the overriding issue in poor countries, and (2) the only thing that really matters to reducing absolute income poverty is the rate of economic growth. The author takes (1) as given but questions (2). He argues that there are a number of ways in which the extent of inequality in a society, and how it evolves over time, influences the extent of poverty today and the prospects for rapid poverty reduction in the future.Publication More Relatively-Poor People in a Less Absolutely-Poor World(World Bank, Washington, DC, 2012-07)Relative deprivation, shame and social exclusion can matter to the welfare of people everywhere. The authors argue that such social effects on welfare call for a reconsideration of how we assess global poverty, but they do not support standard measures of relative poverty. The paper argues instead for using a weakly-relative measure as the upper-bound complement to the lower-bound provided by a standard absolute measure. New estimates of global poverty are presented, drawing on 850 household surveys spanning 125 countries over 1981-2008. The absolute line is $1.25 a day at 2005 prices, while the relative line rises with the mean, at a gradient of 1:2 above $1.25 a day. The authors show that these parameter choices are consistent with cross-country data on national poverty lines. The results indicate that the incidence of both absolute and weakly-relative poverty in the developing world has been falling since the 1990s, but more slowly for the relative measure. While the number of absolutely poor has fallen, the number of relatively poor has changed little since the 1990s, and is higher in 2008 than 1981.Publication Comment on 'Counting the World's Poor' by Angus Deaton(Washington, DC: World Bank, 2001-10)This issue provides a usefully critical discussion of the current methods used by the World Bank for measuring poverty. The author will not address all the points raised by Deaton- avoiding those on which the author thinks there is broad agreement that the World Bank s current methods can be improved. These include the way that (invariably troublesome) income surveys are handled, the scope for better use of subjective-qualitative welfare data, and the need to better acknowledge the limitations of welfare metrics based solely on consumption of market goods. This leaves two main issues that are very important for global poverty measurements- namely, how currency conversions are done and whether the poverty measures should be anchored to the national accounts. On both counts, Deaton makes recommendations for changing current methods. Before considering his recommendations, the author will briefly describe how the World Bank measures poverty.Publication Gender Inequality and Growth : The Case of Rich vs. Poor Countries(World Bank Group, Washington, DC, 2015-01)This paper uses cross-section data for 107 countries to explore the relationship between gender inequality and economic growth. The paper departs from the literature by using a broad measure of gender inequality that goes well beyond gender inequality in education, which has been the focus of most studies. Another novelty of the paper lies in exploring heterogeneity in the growth-gender inequality relationship. The results confirm that greater gender inequality is strongly associated with lower economic growth. However, this negative relationship between gender inequality and growth is entirely due to the relatively poor countries, with the relatively rich countries showing no such relationship. The findings have important implications for the design and targeting of gender-specific policies.Publication Asset Inequality and Agricultural Growth: How Are Patterns of Asset Inequality Established and Reproduced?(Washington, DC: World Bank, 2005)The relationship between distributions of asset inequality, how these distributions are created and maintained, and agricultural growth are explored. The paper studies Ethiopian agriculture to investigate how differential access to productive assets in the agricultural sector, at various levels (regional, community and household), effect inequalities in agricultural outcomes in terms of productivity and poverty. The dominant discourse on agricultural productivity and distribution has been largely focused on input-output relationships, defined and measured with a yardstick specific to economics. In this study, the processes and institutions that link inequality and productivity are explored. In the Ethiopian case, the persistent nature of inequality is causally related to historical choices and path dependency. What is observed is a complex system whereby inequality affects growth which in turn reinforces processes that exacerbate and reproduce inequalities.
Users also downloaded
Showing related downloaded files
Publication Social Cohesion and Forced Displacement(Washington, DC: World Bank, 2022)This report presents new evidence from 26 background studies on forced displacement and social cohesion to expand the current knowledge base on how to prevent social conflict and promote social cohesion in forced displacement contexts. The background studies are geographically and methodologically diverse. They examine social cohesion in a variety of low-, middle-, and high-income countries across Africa, Asia, Central, and South America, and Europe. Building on this new evidence, the report provides lessons on how development investments and policies can reduce inequalities, alleviate social tensions, and promote social cohesion between and within displaced populations and host communities. Overall, the findings demonstrate that, while displacement can exacerbate existing inequalities and create new inequalities and the potential for conflict, especially in areas with strained services and limited economic opportunities, inclusive policies and development investments can effectively mitigate the negative effects of displacement and promote social cohesion.Publication Classroom Assessment to Support Foundational Literacy(Washington, DC: World Bank, 2025-03-21)This document focuses primarily on how classroom assessment activities can measure students’ literacy skills as they progress along a learning trajectory towards reading fluently and with comprehension by the end of primary school grades. The document addresses considerations regarding the design and implementation of early grade reading classroom assessment, provides examples of assessment activities from a variety of countries and contexts, and discusses the importance of incorporating classroom assessment practices into teacher training and professional development opportunities for teachers. The structure of the document is as follows. The first section presents definitions and addresses basic questions on classroom assessment. Section 2 covers the intersection between assessment and early grade reading by discussing how learning assessment can measure early grade reading skills following the reading learning trajectory. Section 3 compares some of the most common early grade literacy assessment tools with respect to the early grade reading skills and developmental phases. Section 4 of the document addresses teacher training considerations in developing, scoring, and using early grade reading assessment. Additional issues in assessing reading skills in the classroom and using assessment results to improve teaching and learning are reviewed in section 5. Throughout the document, country cases are presented to demonstrate how assessment activities can be implemented in the classroom in different contexts.Publication Morocco Economic Update, Winter 2025(Washington, DC: World Bank, 2025-04-03)Despite the drought causing a modest deceleration of overall GDP growth to 3.2 percent, the Moroccan economy has exhibited some encouraging trends in 2024. Non-agricultural growth has accelerated to an estimated 3.8 percent, driven by a revitalized industrial sector and a rebound in gross capital formation. Inflation has dropped below 1 percent, allowing Bank al-Maghrib to begin easing its monetary policy. While rural labor markets remain depressed, the economy has added close to 162,000 jobs in urban areas. Morocco’s external position remains strong overall, with a moderate current account deficit largely financed by growing foreign direct investment inflows, underpinned by solid investor confidence indicators. Despite significant spending pressures, the debt-to-GDP ratio is slowly declining.Publication Sourcebook on the Foundations of Social Protection Delivery Systems(Washington, DC: World Bank, 2020-07-30)The Sourcebook synthesizes real-world experiences and lessons learned of social protection delivery systems from around the world, with a particular focus on social and labor benefits and services. It takes a practical approach, seeking to address concrete “how-to” questions, including: How do countries deliver social protection benefits and services? How do they do so effectively and efficiently? How do they ensure dynamic inclusion, especially for the most vulnerable and needy? How do they promote better coordination and integration—not only among social protection programs but also programs in other parts of government? How can they meet the needs of their intended populations and provide a better client experience? The Sourcebook structures itself around eight key principles that can frame the delivery systems mindset: (1) delivery systems evolve over time, do so in a non-linear fashion, and are affected by the starting point(s); (2) additional efforts should be made to “do simple well”, and to do so from the start rather than trying to remedy by after-the-fact adding-on of features or aspects; (3) quality implementation matters, and weaknesses in the design or structure of any core system element will negatively impact delivery; (4) defining the “first mile” for people interface greatly affects the system and overall delivery, and is most improved when that “first mile” is understood as the weakest link in delivery systems); (5) delivery systems do not operate in a vacuum and thus should not be developed in silos; (6) delivery systems can contribute more broadly to government’s ability to intervene in other sectors, such as health insurance subsidies, scholarships, social energy tariffs, housing benefits, and legal services; (7) there is no single blueprint for delivery systems, but there are commonalities and those common elements constitute the core of the delivery systems framework; (8) inclusion and coordination are pervasive and perennial dual challenges, and they contribute to the objectives of effectiveness and efficiency.Publication Digital Africa(Washington, DC: World Bank, 2023-03-13)All African countries need better and more jobs for their growing populations. "Digital Africa: Technological Transformation for Jobs" shows that broader use of productivity-enhancing, digital technologies by enterprises and households is imperative to generate such jobs, including for lower-skilled people. At the same time, it can support not only countries’ short-term objective of postpandemic economic recovery but also their vision of economic transformation with more inclusive growth. These outcomes are not automatic, however. Mobile internet availability has increased throughout the continent in recent years, but Africa’s uptake gap is the highest in the world. Areas with at least 3G mobile internet service now cover 84 percent of Africa’s population, but only 22 percent uses such services. And the average African business lags in the use of smartphones and computers as well as more sophisticated digital technologies that catalyze further productivity gains. Two issues explain the usage gap: affordability of these new technologies and willingness to use them. For the 40 percent of Africans below the extreme poverty line, mobile data plans alone would cost one-third of their incomes—in addition to the price of access devices, apps, and electricity. Data plans for small- and medium-size businesses are also more expensive than in other regions. Moreover, shortcomings in the quality of internet services—and in the supply of attractive, skills-appropriate apps that promote entrepreneurship and raise earnings—dampen people’s willingness to use them. For those countries already using these technologies, the development payoffs are significant. New empirical studies for this report add to the rapidly growing evidence that mobile internet availability directly raises enterprise productivity, increases jobs, and reduces poverty throughout Africa. To realize these and other benefits more widely, Africa’s countries must implement complementary and mutually reinforcing policies to strengthen both consumers’ ability to pay and willingness to use digital technologies. These interventions must prioritize productive use to generate large numbers of inclusive jobs in a region poised to benefit from a massive, youthful workforce—one projected to become the world’s largest by the end of this century.