Delivering on the Promise of Propoor Growth Insights and Lessons from Country Experiences

2007·9.7 MB·English

by  Timothy Besley

Copyrightedmaterial
DELIVERING ON THE PROMISE
OF PRO-POOR GROWTH
Copyrightedmaterial
Copyrightedmaterial
DELIVERING ON THE
PROMISE OF PRO-POOR
GROWTH
Insights andLessonsfrom CountryExperiences
TimothyBesleyandLouise Cord,Editors
J.
A copublication of Palgrave Macmillan
and the World Bank
Copyrightedmaterial
©1821080H7TSthreeeItnNterWnationalBankforReconstructionandDevelopment/TheWorldBank
WashingtonDC20433
Telephone:[phone]
Internet:www.worldbank.org
E-mail:[email protected]
Allrightsreserved.
1 234 10090807
AcopublicationofTheWorldBankandPalgraveMacmillan.
PalgraveMacmillan
Houndmills,Basingstoke,HampshireRG216XSand
175FifthAvenue,NewYork,NY10010
Companiesandrepresentativesthroughouttheworld
PalgraveMacmillanistheglobalacademicimprintofthePalgraveMacmillandivisionofSt.Martin's
Press,LLCandofPalgraveMacmillanLtd.
Macmillan®isaregisteredtrademarkintheUnitedStates,UnitedKingdom,andothercountries.Pal-
graveisaregisteredtrademarkintheEuropeanUnionandothercountries.
ThisvolumeisaproductofthestaffoftheInternationalBankforReconstructionandDevelopment/
TheWorld Bank.The findings, interpretations,andconclusionsexpressed inthisvolumedo not
necessarilyreflecttheviewsoftheExecutiveDirectorsofTheWorldBankorthegovernmentsthey
represent.
TheWorldBankdoesnotguaranteetheaccuracyofthedataincludedinthiswork.Thebound-
aries,colors,denominations,andotherinformationshownonanymapinthisworkdonotimplyany
judgementonthepartofTheWorldBankconcerningthelegalstatusofanyterritoryortheendorsement
oracceptanceofsuchboundaries.
RightsandPermissions
Thematerialinthispublicationiscopyrighted.Copyingand/ortransmittingportionsorallofthiswork
withoutpermissionmaybeaviolationofapplicablelaw.TheInternationalBankforReconstructionand
Development/TheWorldBankencouragesdisseminationofitsworkandwillnormallygrantpermission
toreproduceportionsoftheworkpromptly.
Forpermissiontophotocopyorreprintanypartofthiswork,pleasesendarequestwithcomplete
informationtotheCopyrightClearanceCenterInc.,222RosewoodDrive,Danvers,MA01923,USA;
telephone:[phone];fax:[phone];Internet:www.copyright.com.
All other queries on rights and licenses, including subsidiary rights, should be addressed to
the Office ofthe Publisher,TheWorld Bank, 1818 H Street NW,Washington, DC 20433, USA;
fax:[phone];e-mail:[email protected].
ISBN-10:0-8213-6515-0(softcover)
ISBN-10:0-8213-6670-X(hardcover)
ISBN-13:978-0-8213-6515-1
eISBN-10:0-8213-6516-9
eISBN-13:978-0-8213-6516-8
DOI:10.1596/978-0-8213-6515-1
LibraryofCongressCataloging-in-PublicationsDatahasbeenappliedfor.
Coverdesign:PaineBluettPaine,Inc.
Copyrightedmaterial
Contents
Acknowledgments IX
Abbreviations xi
1. Overview
LouiseJ.Cord
2. HowIndonesiaConnectedthePoortoRapid
EconomicGrowth 29
C.PeterTimmer
3. ThePolicyOriginsofPovertyandGrowthinIndia 59
TimothyBesley,RobinBurgess,andBertaEsteve-Volart
4. ExplainingPro-PoorGrowthinBangladesh:
Puzzles,Evidence,andImplications 79
BinayakSen,MustafaK.Mujeri,andQuaziShahabuddin
5. Pro-PoorGrowthinVietnam:MiracleorModel? 119
RainerKlump
6. Ghana:TheChallengeofTranslatingSustained
GrowthintoPovertyReduction 147
ErnestAryeeteyandAndrewMcKay
7. Uganda'sExperiencewithOperationalizing
Pro-PoorGrowth,1992to2003 169
JohnA.Okidi,SarahSsewanyana,LawrenceBategeka,
andFredMuhumuza
8. TheSuccessofPro-PoorGrowthinRuralandUrbanTunisia 199
MohamedHediLahouel
9. HumanCapital,Inequality,andPro-PoorGrowthinBrazil 219
NaercioMenezes-FilhoandLigiaVasconcellos
Index 245
v'\ Contents
TABLES
1.1 InitialConditionsintheEightCountriesStudied 3
1.2 BasicPoverty,Growth,andInequalityTrendsintheEight
CountriesStudied 5
2.1 IncomeDistributionandtheShareofthePoorinNationalIncome,
1964/65-2002 37
2.2 PercentageofEmploymentbyMajorSector,UrbanandRuralAreas,
FormalandInformalSectors,Indonesia,1986-2004 38
2.3 FactorsAffectingChangesintheHeadcountIndexofPoverty 43
2.4 RoadsandTrucksinIndonesia,1939-98 49
3.1 PovertyandGrowthacrossIndianStates 63
3.2 ClassificationofStatesaccordingtoTotalPovertyElasticityand
GrowthComponents 64
3.3 RankingsofGrowthElasticitiesofPoverty,GrowthRates,and
PoliciesofIndianStates,1958-2000 73
4.1 TrendsinFoster-Greer-ThorbeckeMeasuresofPoverty:
ConsumptionExpenditureData 81
4.2 SocialDevelopmentinBangladesh:PredictedversusActualValues 83
4.3 AverageAnnualEconomicGrowthinBangladeshatConstant
1995/96Prices 85
4.4 TrendsinInequality:ConsumptionData(Tk/month/person) 86
4.5 OrdinaryGrowthandPro-PoorGrowthRatesinBangladesh:
1990sversus1980s 87
4.6 OrdinaryGrowthandPro-PoorGrowthRatesinBangladesh:
Rural,Urban,andNational,1991/92-2000 88
4.7 RelativePerformanceofMacroeconomicIndicators,1975-2000 89
4.8 PercentageDistributionofPublicExpenditureinAgriculturalandRural
DevelopmentinBangladesh:1980-2001 91
4.9 ReturnstoLaborbyModeandSectorofEmploymentandbyPoverty
StatusinRuralAreas:1999/2000 98
4.10 PercentageofRuralLaborForceinNonfarmSector,1983-2000 99
4.11 ChangesinLandTenure:1983/84-1996 100
4.12 RuralIncomeInequalityandItsSources,1991-2000 106
4.13 UrbanIncomeInequalityandItsSources,1991-2000 108
5.1 Vietnam'sPerCapitaIncome(Percentage)RelativetoImportant
NeighboringCountries,1950-99 121
5.2 DimensionsofPovertyinVietnam,1993-2004 124
5.3 IndicatorsofGrowthandInequalityinVietnamduringthe1990s 124
5.4 RatesofPro-PoorGrowth,1993-2002 126
5.5 GrowthAccountingforVietnam,1987-2002 127
5.6 NetEnrollmentRates(%)inVietnam,1993-2002 129
5.7 OwnershipStructureofTotalInvestmentinVietnam,1991-2000 131
5.8 GrowthandStructuralChangesintheVietnameseEconomy,
1986-2001 132
5.9 SectoralEmploymentElasticitiesandLaborProductivities,1986-2001 133
6.1 ChangesinPovertyandInequalityattheNationalLevel,
1991/92-1998/99 " 150
Cop
Contents vii
6.2 lrendsmPovertyIncidencebyMainEconomic
ActivityofHousehold,1991/92and1998/99 152
6.3 PovertyReductionbyMainhconomicActivityDecomposed
intoIntragroupandMigrationEffects(Percentage
Contributions),1991/92-1998/99 153
6.4 CollinsandBosworthGrowthAccounting-basedDecompositionof
SourcesofGrowth,GhanaversusSub-SaharanAfrica,1960-97 153
7.1 DecomposingPovertyTrendsinUganda,1992-2003 172
7.2 ContributionofGrowthandInequalitytoPovertyReductionby
RegionandCategoryofEmployment,1992-2003 175
7.3 RatesofAverageExpenditureandPro-PoorGrowth,1992-2003 176
7.4 GrowthRatesbyIndustryGroup,1992-2003 177
8.1 IncidenceofPovertyinTunisia:HeadcountRatiosfortheLowerand
UpperPovertyLines,1980-2000 201
8.2 PovertyIncidenceinTunisia:RegionalHeadcountRatiosfortheLower
PovertyLevel,1980-2000 202
8.3 GrowthPerformance,1962-2000(AnnualAverages) 203
8.4 GrowthDecomposition,1962-2000(inPercentageofTotalGDPGrowth) 203
8.5 TrendsinIncomeInequality,1980-2000(GiniCoefficient) 205
8.6 Pro-PoorGrowthRates,1980-2000 206
8.7 PopulationGrowthandPoverty 215
9.1 InequalityDecompositionsinBrazil(%) 220
9.2 EffectofPensionsonExtremePoverty 223
9.3 GrowthandInequalityPovertyDecomposition,1981-2001 227
9.4 DistributionofStudentsinPublicSchools
byConsumptionBrackets(%) 227
9.5 GrowthElasticityofPovertybyStateandArea 232
9.6 DeterminantsofPro-PoorGrowth 236
9.7 DeterminantsofGrowth 237
FIGURES
1.1 TheEightCountries 2
1.2 UrbanPovertyFellMoreRapidlythanRuralPovertyexcept
inIndonesia 6
1.3 MostPovertyReductionOccurredinRuralAreasexceptinBrazil 6
1.4 EconomicGrowthReducesPoverty 7
1.5 ConsumptionbythePoorGenerallyGrewSlowerthanAverage
Consumption 8
1.6 NationalAveragesinGhanaMaskSignificantRegionalVariation
intheContributionsofGrowthandInequalitytoPovertyReduction 9
1.7 ChangesinGrowthandInequalityAreRelated 10
1.8 SignificantPovertyReductionbutRisingInequalityin
Bangladesh,Uganda,andVietnam 10
1.9 NonagriculturalGrowthWasalmostTripleAgriculturalGrowth 16
2.1 Indonesia'sGrowthIncidenceCurve,1996-2002 33
vm Contents
2.2 IncomeGrowthforBottomQuintilePlottedagainstGrowthforAverage
PerCapitaIncomes,Indonesia,1967-2002 33
2.3 RoadtoPro-PoorGrowth 35
3.1 ChangesinTotalRealIncomePerCapita,TotalOfficialPoverty,
andInequality,byIndianState,1957-2000 61
4.1 Long-TermTrendsinInfantMortality 84
4.2 Bangladesh'sGrowthIncidenceCurves,1991/92-2000 87
5.1 Vietnam'sGrowthIncidenceCurve,1993-2002 125
6.1 Ghana'sGrowthIncidenceCurve,1991-98 149
7.1 Priorto2000GrowthWasRobustandPro-PoorinAbsoluteTerms 173
7.2 StructuralTransformationTaperedOff,1992-2003 178
7.3 UgandanPolicyMakersControlInflationtoaSingleDigit,1991-2004 183
7.4 PolicyLiberalizationReversesCapitalFlightandAttractsFDIto
IndustryandServices 184
7.5 AftertheBoomoftheMid-1990s,CoffeePricesPlummeted 185
8.1 Tunisia'sGrowthIncidenceCurve,1980-2000 206
9.1 PovertyReductioninthe1970s 222
9.2 Brazil'sGrowthIncidenceCurve,1981-2001 226
9.3 AverageYearsofSchoolingandIncomebyBrazilianState,1981 228
9.4 YearsofSchoolingandInequalitybyState,1981 229
9.5 AverageEducationbyRaceandState 230
9.6 AverageEducationbyGenderandState 230
9.7 InitialShareofHigherEducationandtheGrowthElasticityof
Poverty,1981 233
9.8 PreviousChangeinHigherEducationandintheGrowthElasticity
ofPovertybyState,1981-93 233
9.9 ChangeinHigherEducationandInequalitybyState,1981-2001 234
9.10 ChangeinHigherEducationandPovertyReductionbyState,
1981-2001 235