Publication: Pro-Growth Equity: A Policy Framework for the Twin Goals
Date
2016-11
ISSN
Published
2016-11
Abstract
Growth is an important channel for
poverty reduction. Policies to make growth more
"inclusive" have permeated the development debate
and "pro-poor growth" has been the subject of a
wide range of papers in the literature, including issues
related to measurement, modeling, and policy. However, the
analytical and particularly empirical literature to support
the idea that equity-enhancing policies have a positive
effect on growth is more scarce and limited, especially on
the potential policy links. This paper proposes a simple
conceptual framework to identify the main elements that
contribute to the income generation of households, building
on the notion that growth can be seen partly as the
aggregate outcome of the income generation capacity of
households. The framework relies on an asset-based approach,
and offers insights on how a more equitable distribution of
assets and opportunities for their productive use can feed
back into higher growth in the long term. Using this
framework, the paper links the World Bank's twin goals
to specific policy channels that have direct impacts on the
income generation capacity of households, with a particular
focus on households at the bottom of the income
distribution. The four key policy channels include (i)
implementing equitable, efficient and sustainable fiscal
policy and macroeconomic management, (ii) strengthening fair
and transparent institutions capable of delivering quality
basic services, (iii) enabling well-functioning markets, and
(iv) establishing adequate risk management instruments at
the macro and household levels.
Citation
“Lopez-Calva, Luis F.; Rodríguez-Castelán, Carlos. 2016. Pro-Growth Equity: A Policy Framework for the Twin Goals. Policy Research Working Paper;No. 7897. © World Bank, Washington, DC. http://hdl.handle.net/10986/25700 License: CC BY 3.0 IGO.”
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