International Poverty Centre Strengthening the employment nexus between growth and poverty reduction...

International

Poverty Centre

Strengthening the employment nexus between growth and poverty reduction

Comments

By N. Kakwani Director

International Poverty CentreBrasilia BrazilEmail: nanak.kakwani@undp-povertycentre.org

International Poverty Centre

Comments on

• S. R. Osmani

• Azizur Rahman Khan

• Iyanatul Islam

• K. Sundram and S. Tendulkar

International Poverty Centre

Poverty growth curve: Thailand

10 20 30 40 50 60 70 80 90 1005

6

7

8

9

10

Fig1:Poverty growth curve: 1988-1990

10 20 30 40 50 60 70 80 90 1002

3

4

5

6

7

8

Fig2:Poverty growth curve:1990-1992

International Poverty Centre

Poverty growth curve: Thailand

10 20 30 40 50 60 70 80 90 1007.5

8

8.5

9

9.5

10

Fig3:Poverty growth curve:1992-1994

10 20 30 40 50 60 70 80 90 1005.5

6

6.5

7

7.5

Fig4:Poverty growth curve:1994-1996

International Poverty Centre

Poverty growth curve: Thailand

10 20 30 40 50 60 70 80 90 100-3

-2.5

-2

-1.5

-1

-0.5

Fig5: Poverty growth curve:1996-1998

10 20 30 40 50 60 70 80 90 100-5

-4

-3

-2

-1

0

Fig6:Poverty growth curve:1998-2000

International Poverty Centre

Osmani’s framework

1. Growth factor: expansion of production potential

2. The elasticity factor: enhancing employment potential

a. Quantity of employment generated by growth b. Quality of employment : adequate returns from employment

3. The integration factor: expansion of employment potential of the poor.

International Poverty Centre

Growth factor

Y = Total Income or Output in the CountryN = Population

Growth Potential = )/log( NY Elasticity factor

Quantity of employment potential = )/

/log(

NY

Ne

Integration factor

Employment potential of the poor = )/

/log(

Ne

Ne PP

e = employment in the population

Pe

PN

= employment among the poor

= number of poor

International Poverty Centre

Productivity of employment among the poor= )/

log(/ PNP

PP

e

NY

PY = income of the poor.

)/log( PP NYGrowth potential of income of the poor=

)/log( PP NY = )/log( NY + )/

/log(

NY

Ne +

)/

/log(

Ne

Ne PP+ )/

log(/ PNP

PP

e

NY+

If the last three terms are positive for all values of p, then we can say that the growth is pro-poor, which will achieve a maximum reduction in poverty with a given growth rate.

International Poverty Centre

International Poverty Centre

SBS – Ed. BNDES, 10º andar

70076-900 Brasilia DF Brazil

povertycentre@undp-povertycentre.org

www.undp.org/povertycentre

Telephone +55 61 2105 5000