Intertemporal pro-poorness

Abstract

A long-lasting scientific and policy debate queries the impact of growth on distribution. A specific branch of the micro-oriented literature, known as 'pro-poor growth', seeks in particular to understand the impact of growth on poverty. Much of that literature supposes that the distributional impact should be measured in an anonymous fashion. The income dynamics and mobility impacts of growth are thus ignored. The paper extends this framework in two important manners. First, the paper uses an 'intertemporal pro-poorness' formulation that accounts separately for anonymous and mobility growth impacts. Second, the paper's treatment of mobility encompasses both the benefit of "mobility as equalizer" and the variability cost of poverty transiency. Several decompositions are proposed to measure the importance of each of these impacts of growth on the pro-poorness of distributional changes. The framework is applied to panel data on 23 European countries drawn from the 'European Union Statistics on Income and Living Conditions' (EU-SILC) survey.Keywords: pro-poorness, income mobility, growth, poverty dynamics.JEL Classification: D31, D63, I32 * We are very grateful to Philippe Van Kerm and Roberto Zelli for helpful suggestions and comments.

Evaluating Patterns of Income Growth when Status Matters: A Robust Approach

“…The resulting dominance conditions would help to increase the possibility of ordering countries, although at the cost of further restricting the family of social evaluation functions to which such conditions would apply. Second, the framework proposed in this paper could be extended to endorse an intertemporal perspective, as recently explored in Bresson et al (2015), which does not simply compare in a non-anonymous fashion the initial and the final periods, but is able to account for the income and status variation of individuals between these two periods. These extensions will be the subject of future research.…”

The individual poverty incidence of growth

“…This information allows us to find out who are the winners and the losers from growth, useful data, for example, in the evaluation of the efficacy of policy reforms. Grimm (2007), Foster and Rothbaum (2016), and Bresson et al (2018) propose different ways to fill this gap. Grimm (2007) and Bresson et al (2018) provide aggregate measures of pro-poor growth in a non-anonymous fashion.…”

“…Grimm (2007), Foster and Rothbaum (2016), and Bresson et al (2018) propose different ways to fill this gap. Grimm (2007) and Bresson et al (2018) provide aggregate measures of pro-poor growth in a non-anonymous fashion. Grimm (2007) proposes integrating the area under the na-GIC up to the initial headcount ratio, obtaining the variation over time of the Watt index of poverty for all the individuals who were poor in the first period.…”

“…This measure, by focusing exclusively on the initially poor, does not inform on the income trajectories of those individuals who become poor during a given growth period. Bresson et al (2018) propose comparing an aggregate measure of intertemporal poverty with aggregate poverty in the first period. Their measurement procedure, although incorporating the individual poverty dynamic into the aggregate measure of intertemporal growth, loses the individual-based perspective.…”

Growth, Mobility and Social Welfare

“…InAaberge and Mogstad (2015) they consider the special case when time invariant equivalent income is replaced by the present value of the income stream.3 See alsoBresson et al (2018) for a multiperiod approach to evaluate the impact of growth on poverty.…”