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       Sunday, April 22, 2018       
GROWTH - POVERTY NEXUS AND INEQUALITY PERSPECTIVE: Empirical Discourse for Nigeria

GROWTH - POVERTY NEXUS AND INEQUALITY PERSPECTIVE: Empirical Discourse for Nigeria

 

Abstract: This study examines the empirical relationship among growth, inequality, and poverty in Nigeria. The rise in income inequality has diminished the poverty-reducing effects of higher growth. Using data on national income and poverty incidence, the paper estimated the empirical relationship for Nigeria using the White Heteroscedasticity-consistent SEs and covariance procedure. The regression results showed that growth- poverty nexus in Nigeria is nonlinear. An increase of 10 per cent in income would be translated to an increase in poverty of 17.2 per cent, while a mean Gini value of 42.7 would reduce inequalityy by 67.8 per cent. Also, a 10 per cent rise in income would result in reduction of the head-count poverty ratio of between 0.2 and 6.8 per cent. It concluded that the benefits in poverty reduction from growth would vary among different policy regimes. The paper canvassed for a stable macroeconomic framework, optimal policy mix, low and stable inflation, pro-poor government expenditure, as well as anti-poverty policies that ensure that people who escape from poverty never return to it.

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