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The paper examines the pattern of poverty, growth and inequality in Ethiopia in the recent decade. The result shows that growth, to a large extent depends on structural factors such as initial conditions, vagaries of nature, external shocks and peace and stability both in Ethiopia and in the region. Using a rich household panel data, the paper also shows that there is a strong correlation between growth and inequality. In such set up, the effect of implementing a pro-poor growth strategy, compared to allowing the status quo to prevail, can be quite dramatic. On the basis of realistic assumptions, the paper shows that from a baseline in 2000 of a 30 per cent poverty share, over 10 years at growth of 4 per cent per capita, poverty would decline from 44 to 26 per cent for distribution neutral growth (DNG) (i.e. no change in the aggregate income distribution). In contrast, were the growth increment distributed equally across percentiles (equally distributed gains of growth, EDG), the poverty would decline by over half, to 15 per cent, a difference of almost eleven percentage points. Thus, ‘distribution matters’, even, or especially in a poor country like Ethiopia. On the basis of these results the paper outlines policies that could help to design a sustainable pro-poor growth strategy. Copyright © 2008 John Wiley & Sons, Ltd. [ABSTRACT FROM AUTHOR]

The World Development Report 2000/01 builds a complex picture of poverty, and a comprehensive approach to its reduction, which challenges the still dominant neo-liberal paradigm. The significance of inequality in determining the outcomes of economic growth, of vulnerability and the need for an agenda of social security or social protection represent advances in the discourse of international agencies. The uniform and simplistic solutions of the past are dismissed with recognition of the fragility of markets and the problems of privatization. The diversity of poverty is met by emphasis on country strategies, which need to address the issues faced by the losers from the process of economic growth. Diversity has been identified — it now needs analysis. The comprehensive approach advocated should help to stabilize development thinking, to move away from the pendulum swings of policy fashion. The constraints to poverty reduction are under-emphasised — resources to provide safety nets; the problems of preventing or resolving conflict, and the potential political resistance from elites unconvinced that poverty is their problem. Nevertheless, the report provides a basis for building a new international coalition against poverty, with the Bank as one among several agencies, a situation in which it will need to clarify its role. Copyright © 2001 John Wiley & Sons, Ltd. [ABSTRACT FROM AUTHOR]

This article compares income distribution and economic progress to neo-classical and neo-Keynesian schools. It aims to determine empirically whether there is a strong relationship between income distribution and economic progress. Its first section briefly examines the economic theories on the relationship between income inequality and economic progress within the framework of institutional economics. The second section contains the empirical analysis of the hypothesized relationship which involves construction of a model, description of the variables and data, and interpretation of the estimated results. A cross- national study with a sample of 65 countries is carried out. In the final section, conclusions and suggestions for further study are made. The analysis of income distribution and economic progress (or growth) in the past was largely dominated by the conventional approaches such as neo-classical and neo-Keynesian schools. However, institutionalism offers an alternative explanation, particularly on the relationship between income distribution and economic growth.