Growth Is Good For The Poor

Forthcoming: Journal of Economic Growth

Growth Is Good for the Poor
David buck Aart Kraay Development Research Group The World Bank rootage Draft: March 2000 This Draft: March 2002 Abstract: total incomes of the poorest one-fifth part of society rise proportionately with average incomes. This is a consequence of the strong empirical regularity that the share of income accruing to the goat quintile does not vary systematically with average income. In this base we document this empirical regularity in a intumescent sample of 92 countries spanning the past four decades, and show that it holds crossways regions, time periods, income levels, and emergence rates. We next ask whether the factors that explain cross country differences in growth rates of average incomes have differential assembles on the poorest fifth of society. We find that several determinants of growth -- such as good rule of law, openness to multinational trade, and developed financial markets -- have little systematic effect on the share of income that accrues to the bottom quintile. Consequently these factors benefit the poorest fifth of society as much as everyone else.



There is both(prenominal) weak evidence that stabilization from high inflation as well as reductions in the overall size of political sympathies not only raise growth but alike increase the income share of the poorest fifth in society. Finally we sample several factors commonly thought to disproportionately benefit the poorest in society, but find little evidence of their effects. The absence of robust findings emphasizes that we know relatively little empirically about the gigantic forces that account for the cross-country and intertemporal variation in the share of income accruing to the poorest fifth of society. JEL Classification Numbers: D3, I3, O1 Keywords: Income inequality, poverty, growth. _________________________ 1818 H Street N.W., Washington, DC, 20433 (ddollar@worldbank.org (202 473-7458), akraay@worldbank.org (202 473-5756)). We are satisfying Dennis Tao for...If you want to get a full essay, order it on our website: Ordercustompaper.com



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