Economic Growth and Poverty Reduction by Region: Chile 1990‐96

This article examines the evolution of poverty in Chile during 1990‐96, a period of rapid economic growth. It shows that Chile has embarked on a significant poverty‐reduction trajectory. The robustness of this result is examined by using nonparametric estimates of the income distribution and a stochastic dominance test. Growth is an important factor in explaining the poverty reduction that has occurred. Using the Datt‐Ravallion decomposition, it accounts for over 85% of poverty reduction at the national level. However, the pattern varies significantly across regions. Both growth, and its contribution to poverty reduction, vary significantly among regions. This seems to reflect the sectoral composition of growth across regions, with export‐oriented activities producing a larger poverty‐reduction impact.     

Sector Approaches,Sustainable Livelihoods and Rural Poverty Reduction

This article examines the relationship between sector‐wide approaches (SWAps), sustainable livelihoods approaches (SLAs) and rural poverty reduction. The authors suggest that SLAs provide one means by which SWAps can focus more effectively on poverty reduction, whilst SWAps provide an entry point via which government and donor initiatives can be made supportive of the livelihoods of the poor. The article puts forward guidelines indicating the core issues upon which donors should focus to enhance the poverty impact of sector‐wide approaches.     

From Poverty Reduction to Mutual Interests? The Debate on Differentiation in EU Development Policy

Aid to middle‐income countries has become one of the most discussed issues among development researchers and in the current modernisation of the development policy of the European Union. This article argues that the question needs to be dealt with in the context of two interlinked challenges: (i) the need to reconceptualise dominant approaches to global poverty reduction beyond national income, and (ii) the growing range of global challenges and the strategically important role of middle‐income countries. For EU development policy, the implications are twofold: (i) a better‐co‐ordinated cross‐country division of labour, and (ii) a diversification of objectives towards a global rationale of development policy involving closer co‐ordination with other EU external policies.     

Can Trade Help Poor People? The Role of Trade,Trade Policy and Market Access in Tanzania

Many development economists prescribe trade as a poverty‐reducing formula. But how is this elixir supposed to work? This article contributes to the lively debate on this topic with household evidence from Tanzania — a poor country even within sub‐Saharan Africa, the poorest region. About 81% of the poor work in agriculture, which accounts for 88% of the export bundle. The article describes existing poverty and then evaluates the poverty‐reduction potential of trade, trade policy and market access. The article extends the analysis by simulating tariff changes and four switching scenarios that swap some poor households into trade‐related sectors, such as cash cropping or tourism, to project national poverty reductions of up to 5.6% and household income increases of up to 21.5%.     

From Schism to Synthesis: The Off‐Centre Radical‐Reformist Role of Development Management

In a wide range of issues such as aid effectiveness, poverty reduction and planning, development management has witnessed a schism between reformists and radicals. This article traces the ‘schism’ between reformist and radical views, critiques their unnecessary dichotomization and proposes an epistemologically‐grounded metaphor for managing divergent ideas. Moving beyond the schism, the article examines current conceptions from Gulrajani that the synthesis should be at the ‘centre’ of the spectrum between radical and reformist frames. The article then proposes an ‘off‐centre’ radical‐reformist synthesis with a less apologetic acceptance of reformist or ‘managerialist’ approaches.     

Uganda: No More Pro‐poor Growth?

This article explores changing growth regimes in Uganda, from pro‐poor growth in the 1990s to growth without poverty reduction, actually even with a slight increase in poverty, after 2000. Not surprisingly, it finds that good agricultural performance is the key determinant of direct pro‐poor growth in the 1990s, while lower agricultural growth is the root cause of the recent increase in poverty. At the same time, after 2000 low agricultural growth appears to have induced important employment shifts out of agriculture, which have dampened the increase in poverty. The article also assesses the indirect form of pro‐poor growth by analysing the incidence of public spending and the tax system, and finds that indirect pro‐poor growth has been achieved to only a limited extent.     

The Macro Content of PRSPs: Assessing the Need for a More Flexible Macroeconomic Policy Framework

This article analyses the content of 15 Poverty Reduction Strategy Papers from a growth and poverty reduction perspective. Contrary to new trends in developed and middle‐income countries, their policy frameworks lack the necessary flexibility to deal with external shocks and address macroeconomic volatility appropriately. Their fiscal and monetary policies are too narrowly focused on fiscal balance and price stability and consequently pay too little attention to economic fluctuations arising from external shocks, which have major effects on poverty and growth. To address these issues, the article proposes a set of policy measures, including avoidance of excessively tight inflation and fiscal targets (with provisions for fluctuations in commodity prices), more room for countercyclical policy and the adoption of permanent safety nets.     

Distributional Effects of FDI: How the Interaction of FDI and Economic Policy Affects Poor Households in Bolivia

This article provides a CGE analysis of the medium to long‐run impact of FDI inflows on poverty and income distribution in Bolivia. The simulation results suggest that FDI inflows enhance economic growth and reduce poverty. However, the income distribution typically becomes more unequal. In particular, FDI widens disparities between urban and rural areas. The Bolivian government may promote the growth‐enhancing and poverty‐alleviating effects by overcoming labour‐market segmentation and providing complementary public investment in infrastructure. But simulated policy reforms or alternative productivity scenarios are hardly effective in reducing the economic divide.     

Why Agriculture Remains a Viable Means of Poverty Reduction in Sub‐Saharan Africa: The Case of Ethiopia

Although there is much empirical evidence of the importance of agricultureled economic growth, there is a renewed emphasis in development circles on the industrial sector as the main driver of growth, even for the low‐income countries of sub‐Saharan Africa. This article applies a simplified model of agricultural growth linkages to illustrate the importance of agricultural growth for increasing employment and accelerating poverty reduction in Ethiopia. Achieving rapid agricultural growth, however, will require the engagement of small commercial farmers, large enough to adopt new technologies and produce significant marketed surpluses, but small and numerous enough to have spending patterns that drive a large, vibrant rural non‐farm sector.     

Commodity Price Volatility,Vulnerability and Development

This article examines the meaning and consequences of the developing countries’ vulnerability to the volatility of commodity prices. It first considers how to define and measure a country’s shocks and exposure arising from commodity price volatility in order to identify structural as distinct from policy vulnerability. The main channels through which price vulnerability influences economic growth are then presented. Finally, the policy implications for development aid, its allocation and design, are outlined. It is found that, while structural vulnerability is bad for growth, a policy of openness contributes to resilience. With the right rules, aid could play an important growth‐enhancing and poverty‐reducing role if allocated at least partly on the basis of vulnerability.     

Will ‘Emerging Donors’ Change the Face of International Co‐operation?

Responding to the recent upsurge of interest in ‘emerging donors’, this article argues that the DAC share of aid is likely to decline only slowly from what is a historically high level, and at least some non‐DAC donors are likely to see DAC approaches and norms as relevant. Nevertheless, low‐income countries seem likely to have a wider range of financing options. Three key risks are that: they prejudice their debt situation by borrowing on inappropriate terms; they use low‐conditionality aid to postpone necessary adjustment; and they waste resources on unproductive investments. DAC members should develop constructive dialogue with other bilateral donors based on recognition that sustainable development and poverty reduction should be the core purpose of aid.     

Urban poverty,economic restructuring and poverty reduction policy in urban China: Evidence from Shanghai, 1978–2008

This article uses the city of Shanghai as a case study to analyze the changing institutional mechanisms for the new urban poverty stratum in China. Specifically, the article examines urban poverty in relation to economic restructuring and the transformation of the welfare provision system in three stages of market reforms. The article first examines the overall economic growth strategies at the national level, and then examines local government policy outcomes at the city level. The impacts of institutional changes on urban poverty and social inequality are subsequently. Finally, the article assesses the current poverty reduction policies and proposes a “social inclusion” framework to alleviate urban poverty in China.     

Assessing the Role of Tourism in Poverty Alleviation: A Research Agenda

Understanding the tourism‐poverty link is critical if tourism is to be used as a mechanism for reducing poverty. Yet, the available empirical analysis is insufficient for this. This article proposes a research agenda for closing this gap in the literature. It argues that, while analysing the link poses peculiar challenges, models exist to do so. Second, it contends that the key question is not whether the link exists but under what conditions it is strongest. Finally, it maintains that the best way to analyse the link is to incorporate accurate diagnosis and evaluations into tourism projects, using the approaches and concepts of the literature on impact evaluation.     

The Politics of Investment and Growth in Egypt: Experimenting with a New Approach

‘Improve the investment climate!’ is the dominant advice for governments wishing to achieve substantial increases in productive private investment. However, national‐level investment‐climate approaches have been criticised for not paying adequate attention to context and feasibility. This article experiments with a new approach which focuses on sectors and on relationships between policy‐makers and investors, and shows how their common interest helped to overcome obstacles to investment and growth in Egypt. Such public‐private relationships can be abused but they have provided effective transitional arrangements for enhancing investment and inducing a new growth dynamic.     

Questioning the Pro‐Poor Agenda: Examining the Links between Social Protection and Poverty

This article investigates an empirical puzzle. Taking the case of Botswana, how is it that poverty is so high, when the country largely conforms to pro‐poor growth strategies? This article suggests that the minimal role of social‐security policies partly explains the relatively high poverty levels. This hypothesis is tested in a large‐N study of developing countries which shows that broad‐based and generous, rather than pro‐poor, social‐security policies impact strongly on poverty levels. The analysis further alludes to other obstacles to poverty reduction, such as economic transformation, which may be combined with a pro‐active social‐policy agenda. Thus, poverty‐alleviating strategies should be refocused to allow for a wider and more coherent role for social‐security policies.     

Enacting the Millennium Development Goals: Political Technologies of Calculation and the Counter-calculation of Poverty in Namibia

Abstract

This paper advances that the Millennium Development Goals (MDGs) act as a governmentality that brings with them assemblages of international and national policies and practices of poverty reduction. These assemblages are characterized by neoliberal rationalities that shape relationships and practices with and of the poor themselves by repositioning and deploying the values and norms of the market as the principal means for the establishment of development aid partnerships. Such rationalities, we argue, are exercised through political technologies that make visible and operable certain governing schemes such as calculative practices. Drawing on extensive interview, policy, programme, and archival documents, the paper advances the argument that the MDGs and the national development plan for Namibia, Vision 2030, shape ideas of poverty reduction through political technologies of calculation and via multi-scale partnership arrangements. These technologies emerge from diverse elements, subsume the shaping of social and political spaces, and have diverse effects on the lives of the poor. Our analysis also highlights an approach to poverty reduction in Namibia, that of BIG, a Basic Income Grant scheme. We view BIG as a potential counter-calculation of poverty, and counter-partnership to poverty reduction efforts, which can develop into a more socially just and sustainable means to reduce poverty and lead to an overturn of contemporary neoliberal assemblages of poverty reduction.     

No Country Left Behind? Performance Standards and Accountability in US Foreign Assistance

The accountability movement in public policy hails a new programme for US foreign assistance – the Millennium Challenge Account established in 2004 with the aim of ‘picking winners’ for grants among developing countries based on their demonstrated quality of governance. This article uses the MCA's own rating system to dispute its claim to know in advance which countries are best positioned to meet major development goals. High governance scores alone bear little or no relationship to growth in national income or decline in poverty. Attempting to measure public‐policy performance limits the range of choice available to policy‐makers, and may inadvertently limit true performance.     

Paddling on One Side of the Canoe? The Changing Nature of New Zealand's Development Assistance Programme

New Zealand's aid policy has undergone a revolution under the National Party government elected in 2008. Prior to this, NZAID, a semi‐autonomous unit, had evolved to manage aid in line with internationally agreed principles. Under the new government, NZAID was reincorporated into the Ministry of Foreign Affairs and Trade, its focus was shifted from poverty reduction to economic growth, and its programme was aligned with foreign policy. This article aims to provide an overview of the shifts in New Zealand's aid policy over four decades, to explore the relationship between the global aid regime and national practice, and to analyse the influence of politics, and of key individuals, in setting the direction of aid policy.     

Growth and Poverty Reduction in Uganda, 1999–2000: Panel Data Evidence

To explore factors underlying growth and poverty reduction in Africa while overcoming some of the limitations of cross‐country analysis, this article uses micro‐level survey and panel‐data evidence from Uganda spanning 1992–2000. The high elasticity of both income growth and poverty reduction with respect to agricultural output (coffee) prices confirms the benefits from Uganda's decisive liberalisation of output markets. It also suggests the importance of product diversification to protect the poor against price shocks and the potential of cotton‐market improvements in tackling persistent poverty in the North. The importance of improving access to basic education and health care emerges more clearly than in cross‐country analysis, but benefits depend on complementary investments in electricity and other infrastructure, and reductions in civil strife.     

Collective Action and Property Rights for Poverty Reduction: A Review of Methods and Approaches

This article provides a review of literature on the relationship between poverty and the institutions of collective action and property rights, as outlined in the conceptual framework of Di Gregorio et al. (2008). Using the elements of the framework as a guide, it offers an overview of how researchers and practitioners identify and evaluate these concepts. The article emphasises the multidimensionality of poverty and the necessity of applying various approaches and tools to conceptualising and measuring it. In addition to highlighting the crucial role that institutions play in poverty reduction, it shows power relations and the political context to be of fundamental importance in poverty‐related studies.