Poverty Reduction

Imai et al. (2010) has analyzed the effect of the IMF approach and the IMF loans in the poverty household economy in India. The study was conducted on the basis of national-level data, and household economy provided by rural systems in India. The approach showed that the presence of IMFs and the loans offered by them have significant effect in poverty reduce. The used data was indexed by IBR indicator, indicator that reflects the dimensional aspects of poverty, food security, assets, health, employment and agricultural activities. The findings showed that families in poor areas, the approach to poverty reduction is greater when these families borrow from MFIs, than in the case of simply having only access to MFIs. In urban areas, access simply by MFIs has the largest average effect on poverty than taking loans from MFIs for productive purposes. The costumer’s purpose for loans is important in determining the outcomes for poverty reduction.

The debate about policy and poverty reduction touches on three interrelated issues: the measurement of pov- erty, the arithmetic decomposition of poverty reduction into growth and distribution effects, and the causal relationships between growth, distribution and policy variables affecting them. The appropriateness and ac- curacy of measures of poverty have come under repeated scrutiny. There are wide variations in the measures, and small changes in underlying measurement techniques can have significant effects on measured poverty. These measurement problems make it difficult enough to identify trends, and certainly make it very difficult to test complex causal relationships with satisfactory degrees of confidence. On the other hand, the arithme- tic relationship among mean incomes, income distribution and poverty is relatively simple, and can be used to decompose poverty reduction into income growth and distribution components. But these decomposi- tions do not directly tell us much about the causal relationships among growth, distribution and the variables that jointly affect them, which have been the subject of considerable debate. This paper focuses primarily on these causal links, looking particularly at the likely causal relationships between good governance reforms and poverty reduction, operating through effects of governance reforms on distribution. But we begin by outlining the key measurement and arithmetic issues underlying the analysis.

In poor countries, the need to balance short-term fiscal policies with long- term development goals (such as those expressed in the Millennium Devel- opment Goals) typically is associated with the government’s commitment to implementing a poverty reduction strategy. Particularly in sub-Saharan Africa, this commitment takes place within the context of the debt relief provided under the Enhanced Heavily Indebted Poor Countries (HIPC) Initiative and more recently under the Multilateral Debt Relief Initiative (MDRI). Given this context, the first theme covered in this book is debt sustainability. Along with taxation, monetary financing, internal borrow- ing, and quasi-fiscal activities, foreign debt historically has been one of the most important ways through which governments raise the resources needed to implement their development policies. In some cases, however, this has been a double-edged sword, given the need to repay the loans ob- tained from donors and other creditors. Reliance on external debt was not always determined by how much debt could be serviced and repaid, tak- ing into account real growth and international interest rates, and the use of the loans received did not necessarily provide poor people the greatest benefit.

From the estimated regression equation above indicate that when everything else is kept constant one unit increasing in tourism earning rises the GNI as a proxy of poverty by 1.68$, which are compatible with the result of Komsan (2012) who conducted the study on modeling the linkage between tourism and multiple dimension of poverty in Thailand using a seemingly unrelated regression and the result indicated that tourism contributes toward poverty reduction. The increasing in Gross National Income meaning that local people in Tanzania raising their income and their basic necessity are met and on so doing their poverty is reduced. Therefore from these results, the null hypothesis, that tourism earning contributes toward poverty reduction is not rejected.

FDI provides the modern technology and investment capital so important for economic growth (Klein et al., 2001). The resulting economic growth plays an important role in poverty reduction. Sumner (2005) highlighted the importance of FDI on investment capital through the capital account net effect. A net positive transfer on the capital account leads to an increase in investment, which results in high economic growth (Sumner 2005). The effect of FDI on investment capital depends on the net effect of FDI inflows and repatriation of profits, royalties, and intra-subsidiary loans paid out by the foreign subsidiary (Sumner 2005). The increase in investment capital as a result of FDI inflows also depends on the substitution and complementarity between FDI and domestic capital (see De Mello 1999).The more FDI is complementary to domestic investment, the higher is its contribution to poverty reduction (De Mello 1999). On the other hand, if FDI substitutes domestic investment, which results in the crowding out of domestic firms, then FDI’s effect on total investment capital and poverty reduction depends on whether the crowd-out effect is fully offset by the new FDI investment (De Mello 1999).

The study examined the impact of international remittances on poverty reduction in Nigeria. Using time series data on poverty incidence, inward and outward remittances, ODA and technical cooperation grants in Nigeria and applying the ARDL method in analyzing the data, the result indicates that: inward and outward remittances have diverse effects on poverty reduction in Nigeria in the short run. Also in the short run, inward remittances impact was significant while outward remittance was not. ODA and technical cooperation grants also have conflicting effect on poverty in the short run. In the long run, inward remittances intensified poverty while outward remittances, ODA and technical cooperation grants all reduced poverty incidence in Nigeria given their negative coefficients. All the explanatory variables were insignificant in the long run. Based on this result, the study recommended for investment in foreign countries in order to diversify the income source of the economy, create conducive atmosphere for inflow of grants and reduce bottlenecks that hinder inflows of foreign funds as possible ways of reducing poverty in Nigeria.

Pakistan’s current three-year poverty reduction strategy which receives financial support from the IMF, the World Bank and the Asian Development Bank addresses the concerns voiced in Dr Ghayur’s paper. Increased budget outlays for empowering the poor through basic education and preventive health care, even if resulting in a larger fiscal deficit during the first year, is a hallmark of this programme. The emphasis on tax reform, as opposed to expenditure cuts, is tailored to Pakistan’s specific circumstances. Severance compensation helps cushion the blow of lay-offs associated with privatisation of commercial banks. The IFI’s contribute substantially to building capability in banking, public expenditure and taxation, and toward improved governance.

Since the World Bank’s earliest days attempts to reduce poverty have centered around large global organizations. Working through state 3 governments and other formal institutions, credit was distributed to developing countries as long as they adhered to policies prescribed by the World Bank. The focus of poverty reduction from the 1950s-1980s was to integrate poor populations into the economy through better macroeconomic performance. Economists had identified the poor as part of a huge “informal” sector that remained “essentially invisible, in government plans and budgets, in economists’ models, in bankers’ portfolios, and in national policies” (Robinson, 2001, pp. 12). As onlookers observed, the attempt to reduce poverty seemed hopeless. These programs were called structural-adjustment programs, and they were highly unsuccessful. States’ loan

microcredits, and types of microcredit can be viewed as a broad spectrum of microfinance institution services. While (Khavul S., 2010)[3], says that microfinance provides some innovative solutions to avoid problems which may come as a result of adverse selection, moral hazard, and transaction costs. Charity is not a solution to poverty; it creates dependence and lowers self confidence, says (Alam M. & Getubig M., 2010) [4] in his study. He further points out that microcredit can create self-employment almost immediately, while women have the highest rate of poverty and suffer most from its consequences, but on the other hand they are factors that have the most direct impact on their families. The study of (Branjeree A. et.al., 2015) [5] concludes that microfinance affects job offer solutions, here we note that households that have access to credit, noticeable engagement is seen in their businesses, while in other conditions they have been forced to shorten the jobs. Thus, microcredit plays its role as a financial product, in an environment where access to credit and savings is limited for the poor.Based on the survey, in his study (Khandker S.R., 2005) [6] has found strong results at the levels of micro economy and macro economy, thus microcredit has contributed to poverty reduction among poor borrowers, as well as within local economy. Impact seems to be greater for families who have been very poor. (Chemin M., 2008) [7], found that microfinance has had a positive impact on participant’s spending on microcredit programs, on labor supply, and on education, for both men and women. According to (Imai K. & Azam SH., 2012) [8], it can be inferred from the obtained results that the loans offered by microfinance institutions have had significant effects in poverty reduction, particularly in income and consumption of households.

However, the best type of fiscal policy for growth depends on the economic situation and the implementation schedule. In the long term, fiscal policy should aim to maintain public debt at sustainable levels. In the short term, the fiscal policy choices vary between contractionary policy forareas with high budget deficits and expansionary policy inareas that have achieved fiscal stabilit y but have to face recession problems . Moreover, an expansionary fiscal policy may also be justified in low -income areaswith the aim to increase public spending as part of poverty reduction strategy.

Firstly as recognised by PRSP, environment as a function is very wide. Whereas in some countries the concern may be pollution by industries and motor vehicles in Rwanda, concerns are more on land degradation, water, deforestation or generally the degradation of the ecosystem. There is a need for an identification of the balance and mix of priority item in environmental management in Rwanda. Planting trees is important as a remedial action in conserving the environment. However in relation to growth and poverty reduction, there are equally urgent issues of managing the marshlands and relieving over cultivation by applying more inputs especially fertilisers. The latter statement should not imply that fertiliser application is panacea to major land problems in Rwanda. Fertiliser profitability varies with agro economic areas and crops(Kelly and Murekezi 2000).It is neither a substitute to anti erosion conservation.

The largest recipient in terms of the size of A i is the Democratic Republic of Congo, with 34.4 percent of its own GDP in aid receipts, closely followed by two other countries with extremely high poverty rates; Burundi and Liberia. The last country to receive aid in the benchmark allocation is Laos, with 0.72 percent of its GDP in aid. In the tables the countries are ranked by the ratio of y i to h i , from smallest to largest. This means that the countries on top of the list are expected to be allocated the largest A i , as can be seen from the allocation rule in equation (9.1). India, which would by far be the largest recipient in Collier & Dollar’s allocation, and whose aid receipts they constrain to its actual level, is one of the first countries to receive 0 in my benchmark allocation. This may be partly explained by the country’s steady economic growth and poverty reduction the past decade, but could also be due to differences in the estimates from the growth regression. 33 In absolute dollar terms, a few populous countries are the largest recipients in the benchmark allocation. These are Bangladesh and Nigeria, which combined receive more than one third of the total aid budget of $90.4 billion. The dollar amounts are shown for the $2 headcount allocation in table 9.2 together with aid as percentage of GDP. The share of the total aid budget pertaining to each country in the benchmark allocation is shown in table 9.4, where it is compared to the actual allocations of donors. I get back to this comparison in section 9.7

This paper shows that poverty cannot be eradicated, but reduced to the level of living comfort. The causes, effects and solutions to poverty are addressed. The principle of tilling the ground to meet the geometrical wave of food insufficiency across the globe was discussed. The expected holy wedlock between farming and programming received due attention. Applications of Microsoft Visual Studio, 2010 to eleven models that are imperative inputs to Penman-Monteith and Priestly-Taylor equations depict that to achieve quick and drastic poverty reduction software applications should be further developed and integrated with equipment. We developed a dynamic VB.NET class library for soil heat flux, net radiation, psychometric constant, saturation vapour pressure, and slope of saturation vapour pressure curve, barometric pressure at various altitudes, actual vapour pressure, virtual absolute air temperature, mean atmospheric density and latent heat of vapourization. Besides, a flexible and accurate client application where our class functionalities were exposed was developed. Results from our package were compared with previous works and found to be in agreement. With our package, the use of look-up table is eliminated as the required value(s) could be estimated and presented in diverse formats dynamically for use and keep.

Poverty is a complex and multidimensional issue. Over the past four decades, the number of poor in Indonesia has experienced a significant decline, from 40.10 percent in 1976 to 9.82 percent in March 2018. Nevertheless, the disparity of poverty rates between provinces is still quite high. The poverty rate in several provinces in Java Island, for example, is already at the single-digit level, while in Eastern Indonesia, is still more than double-digit level. As it is known, public spending and economic growth are two crucial instruments on poverty reduction programs. This study aims to investigate the role of economic growth and public spending, particularly education, health, and social protection on poverty reduction in Indonesia. By using panel data from 31 provinces during 2009-2018 period, this study used two regression models to analyze the effects of these two variables on poverty reduction, both in urban and rural areas. This study shows that public spending on health and education sectors has a slightly different effect on poverty reduction between urban and rural areas. Convincingly, spending allocation on health and education has had a significant effect to reduce poverty rate in rural areas, while the decline of poverty rates in urban is likely more influenced by spending on health. This study also shows that over the past ten years, economic growth and social protection spending did not have a significant effect on reducing poverty rates. Therefore, in order to reduce poverty more effectively, it would be better for the government to focus its poverty reduction programs on investment in health and education sectors.

First, economic policies that promote growth without targeting inequality are unlikely to reduce the incidence of poverty to the target level established by the RGC. Economic growth is undoubtedly the single most important source of poverty reduction insofar as it improves the mean income of the population. However, in Cambodia the redistribution effect of growth is negative for poverty since growth tends to promote incomes of the higher income groups more than those of lower income groups. Therefore, economic growth by itself is unlikely to yield a substantial reduction in poverty. Although we have not investigated the causes of increased inequality, there is abundant evidence that structural adjustment programs can negatively affect the poor in the short run (Mohan, 2000). For this reason, the RGC will need to adopt pro-poor policies that redress income inequality by targeting human resource development for poor people. These policies are already included in SEDP-II under priority public expenditures on health, education, agriculture and rural development.

Though the interim PRSP (IPRSP) of Pakistan didn’t address the issues of gender but the full PRSP includes this issue. One of the noteworthy additions to the Poverty Reduction Strategy in the full PRSP is the focus on some economy-wide issues like gender mainstreaming, employment and environment. These issues cut across many sectors and policy regimes and have been addressed above at those levels. This section highlights those aspects of the new issues which have not been dealt with earlier while avoiding repetition of policies and measures described earlier. Different measures for the gender equality and women empowerment were suggested in the Draft PRSP (Government of Pakistan, 2003).

The objective of this paper is twofold. First to theoretically derive the elas- ticities of the mean and median incomes of the poor with respect to the those of the population assuming a right-skewed income distribution and examine whether a regression with mean incomes as is usually done is able to capture the true values of the parameters of impact of aggregate growth on the in- come of the poor. Second, to derive a methodology to assess the impact of economic reforms on the income of the poor by comparing the two channels identified above (mean and median incomes) thus enabling the quantifica- tion of the trade-offs involved in poverty reduction policies as suggested in Ravallion (2004).

The study aims at providing an intellectual input to the current effort by the government on the expansion of CPRGS, and is built on the government-donor partnership. While the expansion of CPRGS itself has been conducted under the ownership of the Vietnamese government, several donors (which are actively involved in the country's infrastructure development) have expressed their willingness to assist the government in parallel— particularly in the area of establishing an analytical framework regarding how large-scale infrastructure can contribute to sustainable growth and poverty reduction in Vietnam. The study was conducted by the GRIPS Development Forum* under the initiative of the Government of Japan and with the financial support of JBIC, in close coordination with the Government of Vietnam (through the Ministry of Planning and Investment) and the World Bank, the Asian Development Bank (ADB), UK (DFID), and Australia (AusAID). The study has greatly benefited from collaboration by the concerned partners. The GRIPS study team expresses its deep appreciation to the Government of Vietnam (MPI, MoT, MoH, EVN), provincial authorities, and donors including the World Bank, ADB, Japan (Embassy of Japan, JBIC, JICA), UK (DFID), Australia (AusAID), researchers, consultants (ALMEC) and NGOs (JOICFP) for their valuable advices and research support.

Next we turn to the reduction of poverty rates through taxes and transfers and its relationship to welfare state effort. Table 8 presents the linkage between poverty reduction and social expenditure ratios for 16 European countries where all relevant data items are available. This gives a picture of the targeting of social protection efforts across European countries at one moment in time (around 2003-2005). Table 8 ranks countries according to their ‘effectiveness’ of combating poverty. Absolute antipoverty effects are divided by social spending ratios to see which country targets best per one point of GDP spent on net social expenditure. Our analysis highlights some cross-country differences of poverty alleviation in the EU15, although the ranking must be interpreted with caution due to cyclical factors. For example, each percentage point of net total public social expenditure alleviates poverty in Ireland and the Scandinavian countries by 0.65-1.05 percentage points, while the lowest scores can be found in Italy, Spain and Portugal (0.18-0.32). Especially the ‘top’ position of Ireland seems to be influenced by the recent economic performance in this particular country (high economic growth, low unemployment rates, and (therefore) the lowest level of social expenditures).

The objective of this study is to find out how Thailand achieves her economic growth along with poverty reduction without good governance practice. The relationships among economic growth, poverty indicators and governance indi- cators are computed by using Pearson’s correlation. The computed results show that the poverty reduction in Thailand is achieved through populist policies which are exercised with low quality of governance, not through growth. It sup- ports general belief that the “pro-poor growth” policy alone without good governance performance is insufficient for enhancing poverty reduction equally. A strategy for reducing poverty and income inequality for Thailand is not to en- hance economic growth but to promote major improvements in governance especially in variable that reflect the per- ception in three governance composite indicators namely Voice and Accountability, Political Stability and Absence of Violence, and Rule of Law.