Probing Beneath Gross-national Averages: Poverty, Inequality, and Growth in the Philippines

Date: March 2002
Type: Papers and Briefs
Country:
Subject:
Series: Economics Working Papers
ISSN: 1655-5252 (print)
Author: Balisacan, Arsenio M.; Pernia, Ernesto M.

Description

Recent research employing cross-national regressions shows that the incomes of the poor move one-for-one with overall average incomes, suggesting that economic growth is virtually sufficient for poverty reduction. This paper attempts to probe beneath cross-country averages by analyzing provincial data on the poverty-growth nexus in the Philippines. The results show that economic growth explains a lot but not all about poverty. The balance that seems fairly large can be accounted for by other factors (e.g., infrastructure, human capital, and location-specific characteristics) and institutions (e.g., political economy and agrarian reform).

Thus, while growth is indeed good for the poor, it is not good enough. How much is not good enough is illustrated by this paper and will become clearer as subnational analysis is extended to more countries. For policy purposes, an intracountry examination of the determinants of poverty reduction seems clearly superior to cross-country analysis.

Contents

  • Abstract
  • Introduction
  • National Context and Measurement Issues
  • Growth and Poverty Reduction: The National Picture
  • Provincial Differences in Living Standards
  • Other Determinants of Poverty Reduction
  • Differential Effects on Various Quintiles
  • Conclusion
  • Appendix 
  • References