Poverty reduction, economic growth and inequality in Africa

Fassil Fanta and Mukti Upadhyay ()

Applied Economics Letters, 2009, vol. 16, issue 18, 1791-1794

Abstract: We study the relationships among economic growth, inequality and poverty. Economists agree that growth is fundamental to reducing poverty. But the links among growth, distribution and poverty is still a subject of debate because the growth elasticity of poverty seems to differ from one country to another. Using a data set for 16 African countries, based on household budget surveys, we find strong support that poverty decreases in response to economic growth, with the estimated elasticity ranging between -0.5 and -1.10. Other variables, albeit important in varying degrees, are much less significant as determinants of poverty.

Date: 2009
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DOI: 10.1080/13504850701719587

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