Chapter

Growth is Good for the Poor

David Dollar and Aart Kraay

in Growth, Inequality, and Poverty

Published in print March 2004 | ISBN: 9780199268658
Published online April 2004 | e-ISBN: 9780191600876 | DOI: http://dx.doi.org/10.1093/0199268657.003.0002

Series: WIDER Studies in Development Economics

 Growth is Good for the Poor

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The world economy grew well during the 1990s, despite the financial crisis in East Asia. However, there is intense debate over the extent to which the poor benefit from this growth. The two quotes above exemplify the extremes in this debate. At one end of the spectrum are those who argue that the potential benefits of economic growth for the poor are undermined or even offset entirely by sharp increases in inequality that accompany growth. At the other end of the spectrum is the argument that liberal economic policies such as monetary and fiscal stability and open markets raise incomes of the poor and everyone else in society proportionately.

Keywords: growth; income inequality; poverty

Chapter.  15443 words.  Illustrated.

Subjects: Economic Development and Growth

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