Inequality, income, and poverty: comparative global evidence.
Objectives. The study seeks to provide comparative global evidence on the role of income inequality, relative to income growth, in poverty reduction.Methods. An analysis-of-covariance model is estimated using a large global sample of 1980–2004 unbalanced panel data, with the headcount measure of poverty as the dependent variable, and the Gini coefficient and PPP-adjusted mean income as explanatory variables. Both random-effects and fixed-effects methods are employed in the estimation.Results. The responsiveness of poverty to income is a decreasing function of inequality, and the inequality elasticity of poverty is actually larger than the income elasticity of poverty. Furthermore, there is a large variation across regions (and countries) in the relative effects of inequality on poverty.Conclusion. Income distribution plays a more important role than might be traditionally acknowledged in poverty reduction, though this importance varies widely across regions and countries.
United Nations University—Institute for Development Economics Research (UNU-WIDER).
Augustin Kwasi
AK
Fosu
D003431:Cross-Cultural Comparison; D004651:Employment / Q000191:economics / Q000266:history / Q000331:legislation & jurisprudence / Q000523:psychology; D049673:History, 20th Century; D049674:History, 21st Century; D007182:Income / Q000266:history; D038622:Internationality / Q000266:history / Q000331:legislation & jurisprudence; D011203:Poverty / Q000191:economics / Q000208:ethnology / Q000266:history / Q000331:legislation & jurisprudence / Q000523:psychology; D012923:Social Class / Q000266:history; D012940:Social Problems / Q000191:economics / Q000208:ethnology / Q000266:history / Q000331:legislation & jurisprudence; D012941:Social Responsibility; D012959:Socioeconomic Factors / Q000266:history