Can the chronically poor benefit from a pro-poor growth strategy? - - PowerPoint PPT Presentation

Can the chronically poor benefit from a pro-poor growth strategy?

Edward Anderson, Ursula Grant and Andy McKay Poverty and Public Policy Group, ODI

Introduction

 Conventional view: growth for poverty

reduction

 Direct and indirect benefits  But can this include the chronic poor?

– Vulnerable groups; fragile livelihoods

 Preliminary assessment based on

current country level evidence

Introduction (continued)



ODI research (DFID supported)

– Lessons for poorest from 14 country case studies from multi-donor Operationalising Pro-Poor Growth project – Household trajectories over time: Uganda – Non-income dimensions: Ghana and Uganda



Preliminary, incomplete picture; comments welcome

Finding 1: poorest included in growth where it happened

 Average incomes of poorest 10% grew

in countries experiencing positive growth

 e.g. 0.9% per year increase in

Bangladesh, 2.9% in Uganda, 4.1% in Vietnam

 Incomes of poorest 10% fell in Romania

(negative growth)

Finding 2: but the poorest did not benefit in proportion

 In some cases incomes of the poorest

grew faster than average …

 But in majority of cases they grew less  Some tendency to increased inequality

with growth

Finding 2 continued: cases of increasing inequality

Growth rates for poorest 10% and national growth rates

• 4
• 3
• 2
• 1

1 2 3 4 5 6

Bangladesh 1991-2000 Brazil 1993- 2001 El Salvador 1991-2000 Ghana 1991-1998 India 1994- 2000 Senegal 1994-2001 Romania 1996-2002 Vietnam 1992-2003 Growth rate (% p.a.) Poorest 10% Average growth rate

Finding 2 continued: and some pro-poor(est) cases

Growth rates for the poorest 10% and national growth rates

1 2 3 4 5 6

Bolivia 1989-2002 Burkina Faso 1994- 2003 Indonesia 1996- 2002 Uganda 1992-2003 Zambia 1991-1998 Growth rate Poorest 10% Average growth rate

Finding 3: “pro-poorest” growth has distinctive characteristics

Examples from different country case studies:

 Reduced urban-rural gap and/or strong

performance of agriculture

 Poorest sometimes less hit by downturns  Political economy focused on poorest groups  Infrastructure  Public spending beneficial to poorest

Finding 3 (continued)

 Many reasons why may be harder for

chronic poor to participate in growth e.g.

– Lack of assets – Severe vulnerability – Political exclusion

 However public policy, especially public

spending, can offset

Finding 4: considerable downward and upward mobility

 Follow same households over time to

• bserve mobility … and identify

persistent poor

 Uganda shows considerable mobility …

and fast average growth among poorest

 Substantial vulnerability

Finding 4 (continued)

Annual growth rate of consumption for panel households in Uganda, by percentile, 1992 to 1999

• 5

5 10 15 20 25 10 20 30 40 50 60 70 80 90 100 Percentile

Finding 5: mixed evidence on non- income indicators

 Importance of looking at non-income

welfare indicators (e.g. education, health, vulnerability)

 Evidence of such indicators from

household surveys in Ghana and Uganda during the 1990s shows a mixed picture.

Finding 5 (continued)

 On the positive side:

– Large increases in primary school enrolment and completion rates among the poorest in both countries – Similarly large increases in child vaccination rates among the poorest in Ghana.

Finding 5 (continued)

 On the negative side:

– 12% of surveyed households in Ghana remained asset-less in 1999, and therefore vulnerable to shocks; – Large reductions in child vaccination rates (bcg, measles, dpt) in Uganda

Summary

 Need for further work  However important that the chronic

poor are connected with growth … implications for type of growth

 But growth alone insufficient … and

much too slow to reduce chronic poverty

– Measures to reduce inequality

Summary (continued)

 Key role for public spending in relation

to chronic poor: not just social sector

 Insecurity as a major issue – key role

for social protection