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Absent actual panel household survey data, this paper constructs, for the first time, synthetic panel data for more than 20 countries accounting for two-thirds of the population in Sub-Saharan Africa. In this process, the analysis employs repeated cross sections that span, on average, a six-year period for each country. The analysis suggests that all these countries as a whole have had pro-poor growth. One-third of the poor population escaped poverty during the studied period, which is larger than the proportion of the population that fell into poverty in the same period. The region also saw a 9 percent reduction in poverty and a 28 percent increase in the size of the middle class. However, chronic poverty remains high, and a considerable proportion of the population is vulnerable to falling into poverty. There is some limited evidence that most resource-rich and middle-income countries have more upward mobility than downward mobility. Post-secondary education is especially strongly associated with higher upward mobility and less downward mobility, which holds to some extent for female-headed and urban households.
Middle Class --- Poverty --- Pro-Poor Growth --- Vulnerability --- Welfare Dynamics
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This book examines the effects of trade on growth and poverty. It addresses the following questions:1) Which are the channels through which trade openness may affect the economic activities of a given country? ; 2) What are the effects of trade openness on growth? ; and 3) What are the effects of trade openness on poverty and income distribution?.
Economic Growth --- Inequality --- Macroeconomics and Economic Growth --- Poverty --- Poverty Reduction --- Pro-Poor Growth --- Trade --- Trade Liberalization
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Medicinal and aromatic plants (MAPs) offer opportunities for sustainable economic growth in Nepal.Nepal currently does not hold a significant share of global markets for MAPs, but MAPs are relatively more important in Nepal's export basket compared with other countries.Nepal currently does not hold a significant share of global markets for MAPs, but MAPs are relatively more important in Nepal's export basket compared with other countries.Market access is affected by non-tariff measures in this sector.Currently, Nepal primarily competes in the segment of raw and unbranded MAPs for the non-discerning user. This segment has minimal value addition and a high degree of global competition.This study identifies two segments where Nepal is well positioned to compete in the short to medium term: (i) lightly processed products for the discerning and conscientious consumer, specifically personal care products; and (ii) heavily processed, mass-produced products for non-discerning buyers, specifically Ayurvedic and traditional medicine products.Personal care products are an attractive market segment for individual Nepali entrepreneurs and micro, small and medium enterprises (MSMEs).Nepali firms have the potential to integrate into regional and global value chains for traditional herbal and Ayurvedic medicinal products.While Nepali firms have the potential to compete successfully in the two identified segments, they face many challenges that need to be addressed. Many of the constraints in the MAPs value chains in Nepal are similar to those across the broader agribusiness sector.These challenges include issues with land rental and aggregating land; lack of investment in physical infrastructure; lack of R and D; distortions in input markets (fertilizer and seeds); poor extension services; inadequate support for building firm capabilities; weak quality infrastructure (for testing and certification) that restricts access to foreign markets; poor logistics; insufficient investment in supply chains; and poor access to finance for smaller players in the sector.Sustainability of MAPs is a major concern, especially in higher elevation areas, and requires continued conservation efforts.The government should ease trade frictions for suppliers providing raw materials to domestic manufacturers.In the personal products segment, Nepali firms could benefit from a more conducive environment for e-commerce and skills development.The Ayurvedic and traditional medicine products segment in Nepal could benefit from protecting Nepal's cultural heritage and traditional medicine systems, implementing intellectual property rights (IPR) polices to support private sector growth and attract FDI, and research support to identify the intensity of specific MAPs in their most common final products.Global demand for MAPs, especially as inputs for more complex final goods, has been increasing steadily since the turn of the century. Nepal has the potential to tap into this demand and compete successfully in this market if the challenges faced by Nepali players in the MAPs value chains are addressed.
Export Competitiveness --- Gender --- Industrial and Market Data and Reporting --- Industry --- Microenterprises --- Pro-Poor Growth
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India's manufacturing growth from 1989 to 2010 displays two intriguing properties: 1) a substantial fraction of absolute and net employment growth is concentrated in informal tradable industries, and 2) much of this growth is connected to the development of one-person establishments. This paper investigates the causes and determinants of these growth patterns. The rapid urbanization of the informal sector plays the strongest role, while there is some evidence for subcontracting by the formal sector and a "push" entrepreneurship story. The paper also finds modest connections of this growth to rising female labor force participation. The connection between the presence of informal manufacturing and local productivity levels is strong, and varies across urban and rural areas in ways that bolster urbanization and subcontracting hypotheses.
Banks and Banking Reform --- Development --- Employment --- Growth --- Labor Markets --- Labor Policies --- Manufacturing --- Pro-Poor Growth --- Trade --- Urban
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The 2014 release of a new set of purchasing power parity conversion factors (PPPs) for 2011 has prompted a revision of the international poverty line. In order to preserve the integrity of the goalposts for international targets such as the Sustainable Development Goals and the World Bank's twin goals, the new poverty line was chosen so as to preserve the definition and real purchasing power of the earlier USD 1.25 line (in 2005 PPPs) in poor countries. Using the new 2011 PPPs, the new line equals USD 1.90 per person per day. The higher value of the line in US dollars reflects the fact that the new PPPs yield a relatively lower purchasing power of that currency vis-a-vis those of most poor countries. Because the line was designed to preserve real purchasing power in poor countries, the revisions lead to relatively small changes in global poverty incidence: from 14.5 percent in the old method to 14.1 percent in the new method for 2011. In 2012, the new reference year for the global count, we find 12.7 percent of the world's population, or 897 million people, are living in extreme poverty. There are changes in the regional composition of poverty, but they are also relatively small. This paper documents the detailed methodological decisions taken in the process of updating both the poverty line and the consumption and income distributions at the country level, including issues of inter-temporal and spatial price adjustments. It also describes various caveats, limitations, perils and pitfalls of the approach taken.
Global poverty --- Macroeconomics and economic growth --- Poverty measurement --- Poverty reduction --- Pro-poor growth --- Purchasing power parity --- Rural poverty reduction
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Longstanding development issues are revisited in the light of a newly-constructed data set of poverty measures for India spanning 60 years, including 20 years since reforms began in earnest in 1991. The study finds a downward trend in poverty measures since 1970, with an acceleration post-1991, despite rising inequality. Faster poverty decline came with higher growth and a more pro-poor pattern of growth. Post-1991 data suggest stronger inter-sectoral linkages: urban consumption growth brought gains to the rural as well as the urban poor, and the primary-secondary-tertiary composition of growth has ceased to matter, as all three sectors contributed to poverty reduction.
Economic Growth --- Inequality --- Kuznets --- Poverty --- Poverty Reduction --- Pro-Poor Growth --- Rural Poverty Reduction --- Services & Transfers to Poor --- Urbanization
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The 2014 release of a new set of purchasing power parity conversion factors (PPPs) for 2011 has prompted a revision of the international poverty line. In order to preserve the integrity of the goalposts for international targets such as the Sustainable Development Goals and the World Bank's twin goals, the new poverty line was chosen so as to preserve the definition and real purchasing power of the earlier USD 1.25 line (in 2005 PPPs) in poor countries. Using the new 2011 PPPs, the new line equals USD 1.90 per person per day. The higher value of the line in US dollars reflects the fact that the new PPPs yield a relatively lower purchasing power of that currency vis-a-vis those of most poor countries. Because the line was designed to preserve real purchasing power in poor countries, the revisions lead to relatively small changes in global poverty incidence: from 14.5 percent in the old method to 14.1 percent in the new method for 2011. In 2012, the new reference year for the global count, we find 12.7 percent of the world's population, or 897 million people, are living in extreme poverty. There are changes in the regional composition of poverty, but they are also relatively small. This paper documents the detailed methodological decisions taken in the process of updating both the poverty line and the consumption and income distributions at the country level, including issues of inter-temporal and spatial price adjustments. It also describes various caveats, limitations, perils and pitfalls of the approach taken.
Global poverty --- Macroeconomics and economic growth --- Poverty measurement --- Poverty reduction --- Pro-poor growth --- Purchasing power parity --- Rural poverty reduction
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India's manufacturing growth from 1989 to 2010 displays two intriguing properties: 1) a substantial fraction of absolute and net employment growth is concentrated in informal tradable industries, and 2) much of this growth is connected to the development of one-person establishments. This paper investigates the causes and determinants of these growth patterns. The rapid urbanization of the informal sector plays the strongest role, while there is some evidence for subcontracting by the formal sector and a "push" entrepreneurship story. The paper also finds modest connections of this growth to rising female labor force participation. The connection between the presence of informal manufacturing and local productivity levels is strong, and varies across urban and rural areas in ways that bolster urbanization and subcontracting hypotheses.
Banks and Banking Reform --- Development --- Employment --- Growth --- Labor Markets --- Labor Policies --- Manufacturing --- Pro-Poor Growth --- Trade --- Urban
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Large-scale government cash transfer programs have become an important element of social protection and poverty reduction strategies throughout the developing world. Pakistan is no exception; in 2008, Pakistan established the Benazir Income Support Program (BISP) as an unconditional cash transfer targeted at the poorest of the poor. The primary goal of the BISP program is to provide the poorest households in Pakistan with unconditional transfers in order to improve their consumption and investments in children. To attain this goal, it is believed important that the transfers are provided directly to women to ensure the funds are spent as intended. Beyond changes in consumption and investment, directing these transfers to women can also serve to empower women by increasing household resources under their control. We analyze the impacts of Pakistan's BISP program on women's decision-making power within households using data collected between 2011 and 2013 as the program was rolling out. Using fuzzy regression discontinuity methods to statistically identify impacts, the BISP transfer is found to have substantial, positive impacts on some variables measuring women's decision-making power and empowerment.
Cash Transfers --- Empowerment --- Gender --- Inequality --- Poverty Reduction --- Pro-Poor Growth --- Social Protections & Assistance --- Social Protections and Labor
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Peru has been one of the most prominent performers in Latin America in the last 25 years. Peru is characterized by a complex and diverse geography that holds wealth in natural resources and several spatial development challenges.Peru has a remarkable cultural heritage and rich ethnic diversity. Peru's geography, natural endowments, and diverse population have shaped its unbalanced economic development.Geography and resource abundance have thus led to a spatial concentration of economic activities and opportunities, creating large disparities in development across the country's territory and its population groups.The virtuous cycle of growth and shared prosperity can be explained in large part by a combination of two main forces: favorable exogenous conditions and successful macro structural reforms.The new headwinds indicate that the past virtuous cycle of growth and shared prosperity may have reached its limit.These new headwinds highlight two structural challenges that have emerged from Peru's specific endowments, and that constrain the opportunities for income growth of the bottom 40 percent. First, the persistence of large spatial disparities in development consistently undermine the ability of certain population groups, particularly indigenous and Afro Peruvians, from overcoming poverty. Moreover, the capital-centric development model contributes to imbalances within the urban sector.Peru's second structural challenge relates to the large productivity gap of its private sector relative to its peers, which is constraining the demand for better-paying jobs and income opportunities. Peru's low aggregate productivity stems in part from substantial misallocation of capital and labor as its more productive firms do not necessarily hire more workers or invest more.The Systemic Country Diagnostic (SCD) prioritizes policy constraints that have the greatest impact on Peru's structural challenges of reducing the large spatial disparities and boosting private sector productivity. The SCD uses the following selection criteria to identify the constraints with the largest impact on achieving shared prosperity going forward. First, it identifies constraints that significantly affect one or both of the two main structural challenges. Second, it identifies policy constraints that present synergies to overcome these structural challenges. Third, it identifies constraints that support the sustainability of addressing Peru's structural challenges. Applying the three criteria described above, the SCD identifies a set of constraints that are pivotal to address Peru's two main structural challenges and should thus be the focus of policies in coming years.
Economic Growth --- Human Capital --- Inequality --- Macroeconomics and Economic Growth --- Poverty Diagnostics --- Poverty Reduction --- Pro-Poor Growth --- Sustainability
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