Pro-poor Growth and Pro-growth Poverty Reduction: Meaning, Evidence, and Policy Implications

The paper addresses two questions. First, what do regressions reveal about the link from growth to poverty reduction, with differing (i) initial conditions, such as the degree of inequality; and (ii) types of growth, e.g., sectoral balance? Growth on average appears not to redistribute income, pro-poor or antipoor. More interesting is the large cross-country variation; there are hints in a sample of 23 developing countries that: (i) growth may be relatively antipoor in countries that start with high inequality: and (ii) in those countries, agricultural growth may be especially antipoor, a paradoxical finding rejected in country-level studies. The second question is, are there reverse links from asset and income distribution and redistribution lo growth? The nature of inequality might matter, ascribed inequality being antigrowth but some achieved inequality pro-growth. Reductions in severe inequality may be particularly pro-growth. High inequality is associated with low elasticity of poverty to growth. In poor countries, pro-poor growth is best stimulated by policies encouraging appropriate technical progress in agriculture, land redistribution, and fertility reduction.