Global Poverty and Inequality: Is There New Capacity for Redistribution in Developing Countries?

Abstract

Amartya Sen's famous study of famines found that people died not because of a lack of food availability in a country but because some people lacked entitlements to that food. Is a similar situation now the case for global poverty, meaning that national resources are available but not being used to end poverty? This paper argues that up to three-quarters of global poverty, at least at the lower poverty lines, could now be eliminated -in principlevia redistribution of nationally available resources. This paper finds that even at lower poverty lines ending global poverty by growth alone could take over 200 years. At the higher poverty lines ending global poverty by growth alone could take 300-500 years. We argue that the findings imply rationale for a stronger consideration of some national redistribution for purely instrumental reasons: to end global poverty quicker. We find that at lower poverty lines ending global poverty may now be within the financial capacities of most national governments of developing countries either in the form of potential new taxation or reallocation of existing public finances though this is not the case at higher lines. In summary, reducing global poverty at lower poverty lines is increasingly a matter of national inequality.

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