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Inequality And The Impact Of Growth On Poverty: Comparative Evidence For Sub-Saharan Africa

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Executive Summary

This paper explores the extent to which inequality affects the impact of income growth on the rates of poverty changes in Sub-Saharan Africa (SSA) comparatively with non-SSA, based on a global sample of 1977-2004 unbalanced panel data. For both regions and all three measures of poverty - headcount, gap, and squared gap - the paper finds the impact of GDP growth on poverty reduction as a decreasing function of initial inequality. The impacts are similar in direction for SSA and non-SSA, so that within both regions there are considerable disparities in the responsiveness of poverty to income growth, depending on inequality.

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