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Rural poverty in China fell from 96 percent in 1980 to less than 1 percent of the population in 2019. Using PovcalNet data for China and a set of comparable countries, this paper estimates growth-poverty elasticities. It finds that China stands out for its record of sustained, fast growth, rather than because of an unusually high growth-poverty elasticity. In addition, changes in mean consumption, rather than changes in the distribution, drive Poverty Reduction. Furthermore, until 2010, changes in inequality attenuated the impact of growth on poverty. The paper also studies which channels mattered the most for rural Poverty Reduction by applying a decomposition framework to multiple rounds of Chinese Household Income Project surveys conducted in 1988, 1995, 2002, 2007, 2013, and 2018. The findings show that broad-based, labor-intensive growth in agriculture was initially the main driving force for rural Poverty Reduction, followed by the expansion of non-agriculture sectors. As the country's poverty rate approached 10 percent by 2007, transfers from migrant workers and, later, public transfers became the major drivers of further rural Poverty Reduction. Throughout the period, the fall in the demographic dependency rate also played a significant role. As China's living standards continue to rise, the official definition of poverty will have to adjust to the higher minimum. Continued structural transformation and the inclusive growth agenda retain crucial importance for sustained Poverty Reduction.

Decomposition --- Growth Elasticity --- Inequality --- Poverty Lines --- Poverty Reduction --- Rural Development --- Rural Poverty Reduction --- Structural Transformation

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Drawing on a compilation of data from household surveys representing 130 countries, many over a period of 25 years, this paper reviews the evidence on levels and recent trends in global poverty and income inequality. It documents the negative correlations between both poverty and inequality indices, on the one hand, and mean income per capita on the other. It points to the dominant role of Asia in accounting for the bulk of the world's poverty reduction since 1981. The evolution of global inequality in the last decades is also described, with special emphasis on the different trends of inequality within and between countries. The statistical relationships between growth, inequality and poverty are discussed, as is the correlation between inequality and the growth elasticity of poverty reduction. Some of the recent literature on the drivers of distributional change in developing countries is also reviewed.

Developing countries --- Distributional change --- Equity and Development --- Growth elasticity --- Household surveys --- Income --- Income inequality --- Inequality --- Mean income --- Policy Research --- Poverty Impact Evaluation --- Poverty Reduction --- Poverty reduction --- Pro-Poor Growth --- Services and Transfers to Poor

Choose an application

• Reference Manager
• EndNote
• RefWorks (Direct export to RefWorks)

Drawing on a compilation of data from household surveys representing 130 countries, many over a period of 25 years, this paper reviews the evidence on levels and recent trends in global poverty and income inequality. It documents the negative correlations between both poverty and inequality indices, on the one hand, and mean income per capita on the other. It points to the dominant role of Asia in accounting for the bulk of the world's poverty reduction since 1981. The evolution of global inequality in the last decades is also described, with special emphasis on the different trends of inequality within and between countries. The statistical relationships between growth, inequality and poverty are discussed, as is the correlation between inequality and the growth elasticity of poverty reduction. Some of the recent literature on the drivers of distributional change in developing countries is also reviewed.

Developing countries --- Distributional change --- Equity and Development --- Growth elasticity --- Household surveys --- Income --- Income inequality --- Inequality --- Mean income --- Policy Research --- Poverty Impact Evaluation --- Poverty Reduction --- Poverty reduction --- Pro-Poor Growth --- Services and Transfers to Poor