Poverty Reduction and Economic Growth In Southeast Asia
Keywords:
Poverty incidence, Economic growth, Rural poverty, Urban povertyAbstract
Since the 1970s, most Southeast Asian countries have achieved both rapid economic growth per person and large reductions in the incidence of poverty. This study focuses on the relationship between these two phenomena within the Southeast Asian economies, controlling for both the real price of food and the sectoral composition of the growth. Among other issues the paper explores whether the real price of food and the sectoral composition of economic growth – including agriculture, industry and services – affect the rate of poverty reduction, given the overall rate of economic growth. The results confirm that the rate of poverty reduction is strongly related to both of these factors. The sectoral composition of the growth is important, especially in so far as it affects the expansion of the agricultural sector relative to the rest of the economy. The results confirm that growth based on the expansion of this sector contributes more strongly to poverty reduction than growth arising from industry or services.
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