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Articles 1 - 20 of 20
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How Long Will It Take To Lift One Billion People Out Of Poverty?, Martin Ravallion
How Long Will It Take To Lift One Billion People Out Of Poverty?, Martin Ravallion
Martin Ravallion
Alternative scenarios are considered for reducing by one billion the number of people living below $1.25 a day. The low-case, “pessimistic,” path to that goal would see the developing world outside China returning to its slower pace of growth and poverty reduction of the 1980s and 1990s, though with China maintaining its progress. This path would take another 50 years or more to lift one billion people out of poverty. The more optimistic path would maintain the (impressive) progress against poverty since 2000, which would instead reach the target by around 2025-30. This scenario is consistent with both linear projections …
Why Don’T We See Poverty Convergence?, Martin Ravallion
Why Don’T We See Poverty Convergence?, Martin Ravallion
Martin Ravallion
No abstract provided.
Poverty Lines Across The World, Martin Ravallion
Poverty Lines Across The World, Martin Ravallion
Martin Ravallion
National poverty lines vary greatly across the world, from under $1 per person per day to over $40 (at 2005 purchasing power parity). What accounts for these huge differences, and can they be understood within a common global definition of poverty? For all except the poorest countries, the absolute, nutrition-based, poverty lines found in practice tend to behave more like relative lines, in that they are higher for richer countries. Prevailing methods of setting absolute lines allow ample scope for such relativity, even when nutritional norms are common across countries. Both macro data on poverty lines across the world and …
Mashup Indices Of Development, Martin Ravallion
Mashup Indices Of Development, Martin Ravallion
Martin Ravallion
Countries are increasingly being ranked by some new “mashup index of development,” defined as a composite index for which existing theory and practice provides little or no guidance to its design. Thus the index has an unusually large number of moving parts, which the producer is essentially free to set. The parsimony of these indices is often appealing—collapsing multiple dimensions into just one, yielding seemingly unambiguous country rankings, and possibly reducing concerns about measurement errors in the component series. But the meaning, interpretation and robustness of these indices and their implied country rankings are often unclear. If they are to …
Troubling Tradeoffs In The Human Development Index, Martin Ravallion
Troubling Tradeoffs In The Human Development Index, Martin Ravallion
Martin Ravallion
The 20th Human Development Report introduced a new version of its famous Human Development Index (HDI), which aggregates country-level attainments in life expectancy, schooling and income. The main change was to relax the past assumption of perfect substitutability between its components. Most users will not, however, realize that the new HDI has also greatly reduced its implicit weight on longevity in poor countries, relative to rich ones. By contrast, the new HDI’s valuations of extra schooling are now very high—many times the economic returns. An alternative index is proposed that embodies less troubling tradeoffs while still allowing imperfect substitution.
On Multidimensional Indices Of Poverty, Martin Ravallion
On Multidimensional Indices Of Poverty, Martin Ravallion
Martin Ravallion
No abstract provided.
The Developing World's Bulging (But Vulnerable) Middle Class, Martin Ravallion
The Developing World's Bulging (But Vulnerable) Middle Class, Martin Ravallion
Martin Ravallion
The “developing world’s middle class” is defined as those who live above the median poverty line of developing countries but are still poor by US standards; the “Western middle class” are those not poor by US standards. Although barely 80 million people in the developing world entered the Western middle class over 1990-2002, economic growth and global distributional shifts allowed an extra 1.2 billion people to join the developing world’s middle class. Four-fifths came from Asia, and half from China. Most remained fairly close to poverty, with incomes bunched up just above $2 a day. One in six people now …
Bailing Out The World's Poorest, Martin Ravallion
Bailing Out The World's Poorest, Martin Ravallion
Martin Ravallion
While the 2008 financial crisis is global in nature, it is likely to have heterogeneous welfare impacts within the developing world, with some countries, and some people, more vulnerable than others. It also threatens to have lasting impacts for some of those affected, notably through the nutrition and schooling of children in poor families. These features point to the need for a differentiated social policy response, aiming to provide rapid income support to those in most need, while preserving the key physical and human assets of poor people and their communities. The paper points out some mistakes in past crisis …
Are There Lessons For Africa From China’S Success Against Poverty?, Martin Ravallion
Are There Lessons For Africa From China’S Success Against Poverty?, Martin Ravallion
Martin Ravallion
At the outset of China’s reform period, the country had a far higher poverty rate than for Africa as a whole. Within five years that was no longer true. This paper tries to explain how China escaped from a situation in which extreme poverty persisted due to failed and unpopular policies. While acknowledging that Africa faces constraints that China did not, and that context matters, two lessons for Africa stand out. The first is the initial importance of productivity growth in smallholder agriculture, which will require both market-based incentives and public support. The second is the role played by strong …
Decentralizing Eligibility For A Federal Antipoverty Program, Martin Ravallion
Decentralizing Eligibility For A Federal Antipoverty Program, Martin Ravallion
Martin Ravallion
In theory, the informational advantage of decentralizing the eligibility criteria for a federal antipoverty program could come at a large cost to the program’s performance in reaching the poor nationally. Whether this happens in practice depends on the size of the local income effect on the eligibility cut-offs. China’s Di Bao program provides a case study. Poorer municipalities are found to adopt systematically lower thresholds—roughly negating inter-city differences in need for the program and generating considerable horizontal inequity, whereby poor families in rich cities fare better. The income effect is not strong enough to undermine the program’s overall poverty impact; …
Dollar A Day Revisited, Martin Ravallion
Dollar A Day Revisited, Martin Ravallion
Martin Ravallion
The paper presents the first major update of the international “$1 a day” poverty line, first proposed in 1990 for measuring absolute poverty by the standards of the world’s poorest countries. In a new data set of national poverty lines we find that a marked economic gradient only emerges when consumption per person is above about $2.00 a day at 2005 purchasing power parity. Below this, the average poverty line is $1.25, which we propose as the new international poverty line. Relative poverty appears to matter more to developing countries than has been thought. Our proposed schedule of relative poverty …
How Relevant Is Targeting To The Success Of An Antipoverty Program?, Martin Ravallion
How Relevant Is Targeting To The Success Of An Antipoverty Program?, Martin Ravallion
Martin Ravallion
Policy-oriented discussions often assume that “better targeting” implies larger impacts on poverty or more cost-effective interventions for fighting poverty. The literature on the economics of targeting warns against that assumption, but evidence has been scarce, and the lessons from the literature have often been ignored by practitioners. The paper shows that standard measures of targeting performance are uninformative, or even deceptive, about the impacts on poverty, and cost-effectiveness in reducing poverty, of a large cash transfer program in China. The results suggest that in program design and evaluation, it would be better to focus directly on the program’s outcomes for …
Land In Transition: Reform And Poverty In Rural Vietnam, Martin Ravallion, Dominique Van De Walle
Land In Transition: Reform And Poverty In Rural Vietnam, Martin Ravallion, Dominique Van De Walle
Martin Ravallion
No abstract provided.
How Have The World’S Poorest Fared Since The Early 1980s?, Martin Ravallion, Shaohua Chen
How Have The World’S Poorest Fared Since The Early 1980s?, Martin Ravallion, Shaohua Chen
Martin Ravallion
We present new estimates of the extent of the developing world’s progress against poverty. By the frugal $1 per day standard, we find that there were 1.1 billion poor in 2001 — almost 400 million fewer than 20 years earlier. Over the same period, the number of poor declined by over 400 million in China, though half of this decline was in the first few years of the 1980s. The number of poor outside China rose slightly over the period. A marked bunching up of people between $1 and $2 per day has also emerged, with an increase over time …
An Econometric Method Of Correcting For Unit Nonresponse Bias In Surveys, Martin Ravallion, Anton Korinek, Johan Mistiaen
An Econometric Method Of Correcting For Unit Nonresponse Bias In Surveys, Martin Ravallion, Anton Korinek, Johan Mistiaen
Martin Ravallion
Past approaches to correcting for unit nonresponse in sample surveys by re-weighting the data assume that the problem is ignorable within arbitrary subgroups of the population. Theory and evidence suggest that this assumption is unlikely to hold, and that household characteristics such as income systematically affect survey compliance. We show that this leaves a bias in the re-weighted data and we propose a method of correcting for this bias. The geographic structure of nonresponse rates allows us to identify a micro compliance function, which is then used to re-weight the unit-record data. An example is given for the US Current …
Are There Lasting Impacts Of Aid To Poor Areas? Evidence From Rural China, Martin Ravallion, Shaohua Chen, Ren Mu
Are There Lasting Impacts Of Aid To Poor Areas? Evidence From Rural China, Martin Ravallion, Shaohua Chen, Ren Mu
Martin Ravallion
The paper re-visits the site of a large, World Bank-financed, rural development program in China, 10 years after it began and four years after disbursements ended. The program emphasized community participation in multi-sectoral interventions (including farming, animal husbandry, infrastructure and social services). Data were collected on 2,000 households in project and non-project areas, spanning 10 years. A double-difference estimator of the program’s impact (on top of pre-existing governmental programs) reveals sizeable short-term income gains that were mostly saved. Only small and statistically insignificant gains to mean consumption emerged in the longer-term — though in rough accord with the gain to …
China's (Uneven) Progress Against Poverty, Martin Ravallion, Shaohua Chen
China's (Uneven) Progress Against Poverty, Martin Ravallion, Shaohua Chen
Martin Ravallion
While the incidence of extreme poverty fell dramatically in China over 1980-2001, progress was uneven over time and across provinces. Rural areas accounted for the bulk of the gains to the poor, though migration to urban areas helped. Rural economic growth was far more important to national poverty reduction than urban economic growth; agriculture played a far more important role than the secondary or tertiary sources of GDP. Taxation of farmers and inflation hurt the poor; local government spending helped them in absolute terms; external trade had little short-term impact. Provinces starting with relatively high inequality saw slower progress against …
Partially Awakened Giants: Uneven Growth In China And India, Martin Ravallion, Shubham Chaudhuri
Partially Awakened Giants: Uneven Growth In China And India, Martin Ravallion, Shubham Chaudhuri
Martin Ravallion
The paper examines the ways in which recent economic growth has been uneven in China and India and what this has meant for inequality and poverty. Drawing on analyses based on existing household survey data and aggregate data from official sources, the authors show that growth has indeed been uneven—geographically, sectorally and at the household-level—and that this has meant uneven progress against poverty, less poverty reduction than might have been achieved had growth been more balanced, and an increase in income inequality. The paper then examines why growth was uneven and why this should be of concern. The discussion is …
Evaluating Anti-Poverty Programs, Martin Ravallion
Evaluating Anti-Poverty Programs, Martin Ravallion
Martin Ravallion
The chapter critically reviews the methods available for the ex-post counterfactual analysis of programs that are assigned exclusively to individuals, households or locations. The emphasis is on the specific problems encountered in applying these methods to anti-poverty programs in developing countries, drawing on examples from actual evaluations. Two main lessons emerge. Firstly, despite the claims of advocates, no single method dominates; rigorous, policy-relevant evaluations should be open-minded about methodology, adapting to the problem, setting and data constraints. Secondly, future efforts to draw useful lessons from evaluations call for more policy-relevant data and methods than the classic (“black box”) assessment of …
Land Reallocation In Vietnam’S Agrarian Transition, Martin Ravallion, Dominique Van De Walle
Land Reallocation In Vietnam’S Agrarian Transition, Martin Ravallion, Dominique Van De Walle
Martin Ravallion
Liberalizing key factor markets is a crucial step in the transition from a socialist control-economy to a market economy. However, the process can be stalled by imperfect information, high transaction costs and covert resistance from entrenched interests. The paper studies agricultural land reallocation in the wake of Vietnam’s efforts to establish a free market in land-use rights following de-collectivization. Inefficiencies in the initial administrative allocation are measured against an explicit counterfactual. Land allocation responded positively but slowly to the initial inefficiencies. There is no sign that the transition favored the land rich or that it was thwarted by local officials.