Dessus, SebastienHerrera, SantiagoDe Hoyos, Rafael2012-03-302012-03-302008Agricultural Economics01695150https://hdl.handle.net/10986/5644This article uses a sample of 72 developing countries to estimate the change in the cost of alleviating urban poverty brought about by the recent increase in food prices. This cost is approximated by the change in the poverty deficit (PD), that is, the variation in financial resources required to eliminate poverty under perfect targeting. The results show that, for most countries, the cost represents less than 0.2% of gross domestic product. However, in the most severely affected, it may exceed 3%. In all countries, the change in the PD is mostly due to the negative real income effect of those households that were poor before the price shock, while the cost attributable to new households falling into poverty is negligible. Thus, in countries where transfer mechanisms with effective targeting already exist, the most cost-effective strategy would be to scale up such programs rather than designing tools to identify the new poor.ENMeasurement and Analysis of Poverty I320Economic Development: AgricultureNatural ResourcesEnergyEnvironmentOther Primary Products O130Economic Development: Human ResourcesHuman DevelopmentIncome DistributionMigration O150Economic Development : Regional, Urban, and Rural AnalysesTransportation O180Socialist Systems and Transitional Economies : Urban, Rural, and Regional Economics P250Agriculture: Aggregate Supply and Demand AnalysisPrices Q110Urban, Rural, and Regional Economics: Regional MigrationRegional Labor MarketsPopulationNeighborhood Characteristics R230Journal ArticleWorld Bank