Growth, Poverty, and Income Distribution
Chapter 5
The Growth Controversy: Five Critical Questions What is the extent of relative inequality,
and how is this related to the extent of poverty?
Who are the poor? Who benefits from economic growth? Does rapid growth necessarily cause
greater income inequality? What policies can reduce poverty?
Some Basic Concepts
Size distributions
Some Basic Concepts
Size distributions Lorenz curves
Some Basic Concepts
Size distributions Lorenz curves Dualistic development: some stylized
typologies
Some Basic Concepts
Size distributions Lorenz curves Dualistic development: some stylized
typologies Gini coefficients
Some Basic Concepts
Size distributions Lorenz curves Dualistic development: some stylized
typologies Gini coefficients Functional distributions
Inequality and Absolute Poverty in Third World Countries: A Review of the Evidence
Inequality: variations among countries
Inequality and Absolute Poverty in Third World Countries: A Review of the Evidence
Inequality: variations among countries Absolute poverty: extent and magnitude
Inequality and Absolute Poverty in Third World Countries: A Review of the Evidence
Inequality: variations among countries Absolute poverty: extent and magnitude The human poverty index
Economic Characteristics of Poverty Groups Rural Poverty
Economic Characteristics of Poverty Groups Rural poverty Women and poverty Ethnic minorities, indigenous
populations, and poverty
Income Levels, Growth, and the Extent of Poverty The Kuznets hypothesis
Income Levels, Growth, and the Extent of Poverty The Kuznets hypothesis Economic growth and inequality
Redefining Development Goals: Growth With Improved Income Distribution
Growth is necessary, but not sufficient for poverty reduction
Objective: the generation of broad-based income growth while targeting the incomes of particular groups
The Role of Economic Analysis: Redistribution From Growth Growth versus income distribution GNP growth as a biased index of
national development and well-being Constructing a poverty-weighted index
of social welfare
The Role of Economic Analysis: Redistribution From Growth Growth versus income distribution GNP growth as a biased index of
national development and well-being Constructing a poverty-weighted index
of social welfare Combining the economics of growth and
distribution
The Range of Policy Options
Areas of intervention Policy options
– changing relative factor prices– asset redistribution– progressive taxation– transfer payments and public provision of
goods and services The need for a “package” of policies
Concepts for Review Absolute poverty Asset ownership Character of
economic growth Deciles Disposable income Distributive share
index
Equal-weights index Factor-price
distortions Factor share
distribution of income Factors of production Functional distribution
of income
Concepts for Review, cont’d
Gini coefficient GNP growth rate
index Headcount index Human Poverty Index Income inequality Indirect taxes Kuznets curve
Land reform Lorenz curve Personal distribution
of income Poverty gap Poverty-weighted
index Progressive income
tax
Concepts for Review, cont’d
Public consumption Quintiles Redistribution
policies
Regressive tax Size distribution of
income Subsidy
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