• Economic growth, income inequality and poverty reduction: A regional comparative analysis

    Author(s):

     Alexander Bilson Darku* and Eric Agyemang#


    alexander.darku@uleth.ca, eric.agyemang@uleth.ca
    2024-08-01 05:39:57

    96 Downloads 289 Views

    Abstract

    This paper uses data on countries in sub-Saharan Africa (SSA), South and East Asia (SEA), and Latin America and Caribbean countries (LAC) to examine the impact of economic growth on income and human poverty, and assess the role income inequality plays in that relationship. Unlike previous studies, we use System GMM estimator which addresses the endogeneity problem associated with dynamic panel data analysis. We found that in general economic growth has led to reduction in both income and human poverty levels in all the three regions. The reduction in income poverty is greater in SEA than in LAC and SSA, while the reduction in human poverty is greater in SSA than in LAC and SEA. We also found that the positive impact of economic growth on poverty reduction is higher when income inequality is low. Finally, the results showed that economic growth has significantly reduced inequality in SSA, increased inequality in LAC, and has no significant effect on inequality in SEA.

    Keywords
    Economic growth; Income inequality; Poverty; Regional analysis’ System GMM.

    Email it to me(Requires login) Download this PDF file
Top