Ali Nazmi Cora

Economic Growth And Poverty Reduction Ali Nazmi Cora

This study examines the question of whether economic growth tends to reduce poverty, where poverty is measured by the incomes of the poorest 20% and 40% of a population. GDP growth of ten percent per year is associated with income growth of ten percent for the poorest 40% of the population. For the poorest 20% the elasticity of response is 0.921; GDP growth of 10% is associated with income growth of9.21%. These results give strong support to the proposition that growth in per capita GDP can be and usually is a powerful force in reducing poverty.