World Bank Acting Chief Economist and Senior Vice President, Martin Ravallion gives a public lecture, hosted by the University of Technology, Sydney (UTS) Business School: ‘More Relatively-Poor People in a Less Absolutely-Poor World’.
The lecture (which took place on 10 July 2012) is based upon Policy Research Working Paper 6114, produced by Shaohua Chen and Martin Ravallion from the Development Research Group of the World Bank.
Martin Ravallion is ranked amongst the top 100 economists in the world. Below are some of the points that Mr Ravallion spoke about during the lecture.
In the developing world those living on less than $1.25 a day would be considered to be living in poverty. However, in the US, for example, having less than $13 a day to live on would be the equivalent. It is the developing world’s definition that is more generally used. This is where the vast majority of poverty can be found.
Mr Ravallion spoke about both the ‘Welfarist’ and ‘Non-welfarist measures of poverty. The former looks at relative deprivation and the latter at capabilities and the cost of social inclusion. He gave the example of Qat – a type of leaf and mild stimulant (although he pointed out that it didn’t affect him when he tried it) that is part of social life in Yemen. Not being able to afford to partake in this could result in social exclusion.
China has done exceptionally well at reducing poverty. “China is a huge part of the success story” Mr Ravillion said.
In 1981, 84% (835.1 million people) of China was living in poverty (defined as <$1.25/day). In 2008, this figure had fallen to only 13.1% (173m).
Millenium Development Goal 1
Mr Ravillion spoke about the Millenium Development Goal 1 (MDG1), which is to halve the 1990 ‘extreme poverty’ rate by 2015.
In 2008, 47.5% of Sub-Saharan Africa was living on less than $1.25 a day.
Towards the end of the lecture Martin Ravillion stated, “For Africa to achieve what China has achieved it’s going to require even higher growth rates than China has had…”
One of the conclusions drawn from the research was that there has been rising numbers of relative poor (except in East Asia).
Economic growth in developing countries remains a high priority for absolute poverty reduction.