(Luận văn) the role of growth and income distribution in poverty reduction, the case of the south eastern asian countries

International Institute of Social Study University of Economics Erasmus University of Rotterdam, Ho Chi Minh City, Vietnam t to The Netherlands ng hi VIETNAM – THE NETHERLANDS PROGRAMME FOR M.A IN DEVELOPMENT ECONMICS ep w n lo ad y th ju THE ROLE OF GROWTH AND INCOME DISTRIBUTION IN POVERTY yi pl REDUCTION: THE CASE OF THE SOUTH-EASTRN ASIAN COUNTRIES n ua al n va fu ll by Hồ Quốc Tuấn oi m nh at A Thesis Submitted in Partial Fulfillment of the Requirements for the Degree of z z k jm ht vb Master of Art in om l.c gm Development Economics an Lu Under the Supervision of Assoc Prof Dr Nguyễn Trọng Hoài n va ey t re Vietnam – Netherlands Programme, August 2013 International Institute of Social Study University of Economics Erasmus University of Rotterdam, Ho Chi Minh City, Vietnam t to The Netherlands ng hi VIETNAM – THE NETHERLANDS PROGRAMME FOR M.A IN DEVELOPMENT ECONMICS ep w n lo ad y th ju THE ROLE OF GROWTH AND INCOME DISTRIBUTION IN POVERTY yi pl REDUCTION: THE CASE OF THE SOUTH-EASTRN ASIAN COUNTRIES n ua al n va fu ll by Hồ Quốc Tuấn oi m nh at A Thesis Submitted in Partial Fulfillment of the Requirements for the Degree of z z k jm ht vb Master of Art in om l.c gm Development Economics an Lu Under the Supervision of Assoc Prof Dr Nguyễn Trọng Hoài n va ey t re Vietnam – Netherlands Programme, August 2013 DECLARATION This is to certify that thesis entitled “The Role of Growth and Income Distribution in t to Poverty Reduction: The Case of South-Eastern Asian Countries”, which is submitted ng hi by me in fulfillment of the requirement for the degree of Master of Art in ep Development Economic to Vietnam-The Netherlands Programme The thesis w n comprises only my original work and due supervision and acknowledgement have lo ad been made in the text to all other material used y th ju Hồ Quốc Tuấn yi pl n ua al n va ll fu oi m at nh z z k jm ht vb om l.c gm an Lu n va ey t re CERTIFICATION t to ng hi ep w n lo ad ju y th yi pl n ua al n va ll fu oi m at nh z z k jm ht vb om l.c gm an Lu n va ey t re v ACKNOWLEDGEMENT I would not be possible to write this master thesis without the help and support of t to ng people surrounding me hi ep Above all, I am grateful to my supervisor, Assoc Prof Dr Nguyễn Trọng Hoài, for w his helpful comments and supervisions This thesis research would not be feasible n lo without the advices, supports and guidance from him ad y th I would like to acknowledge all the lecturers at the Vietnam – Netherlands ju yi Programme for their knowledge of all the courses, during the time I studied at the pl ua al program Besides, I would like to thank all the academic and technical staffs of the n Vietnam – Netherlands Programme for supporting me during that time n va ll fu I would like to express my gratitude to my family, especially my parents I would not m oi complete this thesis, as well as study in this program, without their scarification, nh encouragement and important support Additionally, I am also grateful to my better at z half for her personal support and patience at all times, which accelerate my thesis z vb jm ht writing process For the love and expectation of my family, which motivate my effort to complete this master degree, my mere expresses of gratitude here have never been k l.c gm sufficient om Last, but not least, I thank my friends and people, who have any help and support for an Lu my thesis but are not above-mentioned n va ey t re vi ABBREVIATIONS Fixed Effect GDP Gross Domestic Product Gini Gini coefficient t to FE ng hi ep w n Generalized Least Squares lo GLS ad Gross National Product ju y th GNP yi MDG Millennium Development Goal pl al Ordinary Least Squares n ua OLS va Poverty Headcount ratio P2 Poverty gap index P3 Poverty squared gap index RE Random Effect n P1 ll fu oi m at nh z z k jm ht vb om l.c gm an Lu n va ey t re vii ABSTRACT This thesis research contributes to exploring the impact of economic growth and t to ng inequality on poverty In detail, this research aims to identify the effect of income hi ep growth on poverty and the impact of inequality on the rate at which growth reduces poverty This research use unbalanced-panel data for South-Eastern Asian countries in w n lo the period from 1981 to 2010 The research argues that for all three measures of ad poverty, i.e headcount ratio (P0), poverty gap (P0) and poverty squared gap (P2) y th ju income growth has a significant and negative impact on poverty The estimated yi pl growth elasticity of poverty for the whole region is -3.25 for P0, -4.00 for P1 and -4.47 al n ua for P2 Additionally, inequality as well as the level of initial inequality is found to n va affect the impact of income growth on poverty reduction significantly Higher ll fu inequality as well as higher initial level of inequality decelerates the growth elasticity m oi of poverty in absolute value Finally, the impacts of income growth and inequality are nh larger on the more sensitive measures of poverty at z z k jm ht vb om l.c gm an Lu n va ey t re viii TABLES OF CONTENTS LIST OF TABLES xi t to LIST OF FIGURES .xii ng hi ep Chapter INTRODUCTION 1.1 Problem Statement w n lo 1.2 Research Objectives ad ju y th 1.3 Research Questions yi 1.4 Research Scope and Data pl LITERATURE REVIEW n Chapter ua al 1.5 Organization of the Thesis n va 2.1 Definitions ll fu oi m 2.1.1 Poverty nh 2.1.2 Economic Growth at z z 2.1.3 Inequality vb jm ht 2.2 The Important Role of Economic Growth in Poverty Reduction k 2.3 Growth and Redistribution Components of Poverty Reduction 10 gm om l.c 2.4 The Impact of Inequality on the Responsiveness of Poverty to Growth 12 2.5 Analytical Framework 15 an Lu 2.6 Chapter Remark 16 RESEARCH METHODOLOGY 18 n va Chapter 3.3 Measurements of Variables 22 ey 3.2 Research Hypothesis 21 t re 3.1 Model Specification 18 ix 3.3.1 Poverty 22 3.3.2 Inequality 23 t to 3.3.3 Income 25 ng hi ep 3.3.4 Initial Inequality and Initial Income or Consumption 25 3.3.5 Growth Rate of Poverty, Income and Inequality 25 w n lo 3.4 Data Collection 26 ad ju y th 3.5 Estimation Strategy 27 yi 3.5.1 The Constant Coefficients Model 27 pl ua al 3.5.2 Random Effects Regression Model 28 n 3.5.3 Fixed Effects Regression Model 28 n va 3.5.4 Choosing between the FE Model and RE Model: The Hausman fu ll Specification Test 29 oi m DATA ANALYSIS 31 z Chapter at nh 3.6 Chapter Remark 30 z ht vb 4.1 South-Eastern Asian Countries: An Overview on Poverty, Income and k jm Inequality 31 l.c gm 4.2 Poverty, Income Growth and Inequality: The Interrelationship 32 4.3 Empirical Results 35 om 4.3.1 Estimation Process 35 an Lu 4.3.2 Choosing the Most Appropriate Model 36 n va 4.3.3 Discussions on the Research Results 37 4.5 Chapter Remark 43 ey t re 4.4 Estimating the Growth Elasticity of Poverty 41 x Chapter CONCLUSION AND POLICY IMPLICATION 44 5.1 Conclusion 44 t to 5.2 Policy Implication 45 ng hi ep 5.3 Limitation and Suggestion of Further Research 46 REFERENCES 48 w n lo APPENDIX A: DESRRIPTION OF THE DATASET 53 ad ju y th APPENDIX B: DESCRIPTIVE STATISTICS OF VARIABLES 59 yi APPENDIX C: RESULTS OF HAUSMAN TEST 62 pl ua al APPENDIX D: REGRESSION RESULTS 65 n APPENDIX E: ESTIMATION OF GROWTH ELASTICITY OF POVERTY 68 n va ll fu oi m at nh z z k jm ht vb om l.c gm an Lu n va ey t re n lo ad y th 55 ju yi pl n ua al Headcount Poverty Gap Squared Gap Year Type Indonesia 1987 Consumption 36.08 Indonesia 1984 Consumption 38.26 30.47 Lao DPR 2008 Consumption 62.93 36.74 Lao DPR 2002 Consumption 51.08 32.63 Lao DPR 1997 Consumption 49.06 34.91 49.32 Lao DPR 1992 Consumption 43.30 30.43 55.68 Malaysia 2009 Income 399.76 46.21 0.00 Malaysia 2007 Income 374.49 46.00 0.00 Malaysia 2004 Income 204.31 37.91 0.54 0.06 Malaysia 1997 Income 328.17 49.15 0.54 Malaysia 1995 Income 263.29 48.52 Malaysia 1992 Income Malaysia 1989 Malaysia 1987 Initial Gini Index Index Coefficient 29.27 68.16 23.14 10.11 38.26 30.47 62.84 21.36 9.57 38.26 30.47 33.88 8.95 3.33 43.30 30.43 43.96 12.11 4.55 43.30 30.43 14.85 6.07 43.30 30.43 16.24 6.22 43.30 30.43 0.00 241.67 48.63 0.00 0.00 241.67 48.63 0.01 241.67 48.63 0.05 241.67 48.63 2.08 0.26 0.05 241.67 48.63 253.06 47.65 1.62 0.14 0.02 Income 228.00 46.17 1.91 0.29 0.08 Income 233.14 47.04 2.39 0.36 0.09 n Coefficient Ratio Lu Initial Income gm va Mean Gini Country oi m ll fu at nh z z k jm ht vb 0.00 om l.c an 0.01 va n re 241.67 48.63 y te 48.63 241.67 48.63 ac th 241.67 si eg cd jg hg n lo ad y th 56 ju yi pl n ua al Headcount Poverty Gap Squared Gap Year Type Malaysia 1984 Income Philippines 2009 Consumption 103.65 42.98 Philippines 2006 Consumption 98.99 Philippines 2003 Consumption 101.51 44.48 Philippines 2000 Consumption 103.16 46.09 22.45 Philippines 1997 Consumption 104.88 46.16 21.61 Philippines 1994 Consumption 83.45 42.89 28.11 Philippines 1991 Consumption 80.88 43.82 30.68 Philippines 1988 Consumption 74.98 40.63 30.48 8.15 Philippines 1985 Consumption 68.82 41.04 34.90 10.27 Thailand 2010 Consumption 220.34 39.37 0.38 0.04 0.01 Thailand 2008 Consumption 210.46 40.51 0.37 0.04 0.01 Thailand 2006 Consumption 209.10 42.35 1.01 0.18 0.05 Thailand 2002 Consumption 171.08 41.98 1.64 0.29 0.09 Coefficient Ratio Index Index Initial Income Initial Gini Coefficient n va Mean Gini Country 0.66 0.23 241.67 48.63 18.42 3.72 1.00 68.82 41.04 22.62 5.48 1.74 68.82 41.04 21.99 5.52 1.83 68.82 41.04 5.48 1.76 68.82 41.04 5.25 1.68 68.82 41.04 gm 2.70 68.82 41.04 8.57 3.13 68.82 41.04 2.87 68.82 41.04 Lu 68.82 41.04 101.95 45.22 oi 3.22 m ll fu 241.67 48.63 nh 44.04 at z z k jm ht vb 7.60 om l.c an 3.99 va n re 101.95 45.22 y te 45.22 101.95 45.22 ac th 101.95 si eg cd jg hg n lo ad y th 57 ju yi pl n ua al Headcount Poverty Gap Squared Gap Type Thailand 2000 Consumption 157.63 42.84 Thailand 1999 Consumption 161.17 43.09 Thailand 1998 Consumption 163.63 41.46 Thailand 1996 Consumption 169.45 42.90 Thailand 1994 Consumption 150.65 43.47 4.11 Thailand 1992 Consumption 143.41 47.86 8.60 Thailand 1990 Consumption 119.09 45.27 11.55 Thailand 1988 Consumption 106.58 43.84 17.20 Thailand 1981 Consumption 101.95 45.22 21.92 5.51 Timor-Leste 2007 Consumption 55.41 31.93 37.44 8.88 Timor-Leste 2001 Consumption 49.18 39.52 52.94 19.13 8.90 Vietnam 2008 Consumption 85.31 35.57 16.85 3.75 1.24 Vietnam 2006 Consumption 79.05 35.75 21.42 5.30 1.87 Vietnam 2004 Consumption 70.79 36.81 28.25 7.21 2.46 Coefficient Ratio Initial Income Initial Gini Index Coefficient 3.04 0.50 0.13 101.95 45.22 3.17 0.46 0.10 101.95 45.22 2.07 0.33 0.09 101.95 45.22 2.48 0.41 0.10 101.95 45.22 0.74 0.20 101.95 45.22 1.56 0.46 101.95 45.22 0.74 101.95 45.22 3.43 0.92 101.95 45.22 1.83 101.95 45.22 49.18 39.52 49.18 39.52 n Index gm Year va Mean Gini Country oi m ll fu at nh z z k jm ht vb 2.36 om l.c Lu an 2.91 va n re 40.07 35.68 y te 35.68 40.07 35.68 ac th 40.07 si eg cd jg hg n lo ad y th 58 ju yi pl n ua al Year Type Vietnam 2002 Consumption 59.72 Vietnam 1998 Consumption 49.79 35.52 Vietnam 1992 Consumption 40.07 35.68 Headcount Poverty Gap Squared Gap Initial Income Initial Gini Coefficient Ratio Index Index Coefficient 37.55 40.05 11.20 4.09 40.07 35.68 49.65 15.05 5.95 40.07 35.68 63.74 23.57 11.01 40.07 35.68 n va Mean Gini Country oi m ll fu at nh z Source: ‘PovcalNet: the online tool for poverty measurement developed by the Development Research Group of the World Bank’ z k jm ht vb om l.c gm an Lu va n y te re ac th si eg cd jg hg 59 t to APPENDIX B: DESCRIPTIVE STATISTICS OF VARIABLES ng hi Table B-1 Summary statistics of poverty, income and inequality: Whole Region ep Variable Mean Std Dev Min Max 56 24.86161 19.65108 37 68.16 56 6.795179 6.410411 04 23.57 56 2.555357 2.781897 01 11.01 121.3622 86.13955 36.08 399.76 1.515928 -1.936546 4.972931 5.912587 28.99 49.15 w Obs n lo p0 ju yi 58 pl Y y th p2 ad p1 39.70655 ll fu Source: Author’s calculations n va 58 n G 1.931183 ua 58 al gY oi m at nh z z k jm ht vb om l.c gm n a Lu n va y te re th 59 60 t to Table B-2 Summary statistics of poverty, income and inequality: Individual ng Country 31.154 10.60923 18.6 44.5 p1 7.642 3.530619 3.51 11.95 p2 2.542 1.399257 96 4.29 Y 72.064 10.12687 56.54 80.48 gY 1.791398 1.047346 2.519097 G 39.676 3.366613 36.03 44.37 p0 10 42.22 18.22257 18.06 68.16 10 11.837 7.134721 3.3 23.14 p2 4.587 3.361002 81 10.11 Y 10 55.225 16.73458 36.08 83.33 gY 10 1.723209 1.603672 -1.936546 3.286494 G 10 31.199 2.457724 28.99 35.57 p0 45.71 9.227574 33.88 55.68 p1 13.0375 8.95 16.24 p2 5.0425 1.36839 3.33 6.22 Y 51.5925 8.245821 43.3 62.93 gY 1.639905 1.155506 2.529285 G 33.6775 2.741136 30.43 36.74 p0 1.757143 970373 54 3.22 p1 26 2118962 05 p2 07 0776745 01 23 Y 280.6544 69.54345 204.31 399.76 gY 5013626 1.398335 -1.190656 2.381442 G 46.36444 3.378603 37.91 49.15 p0 25.69556 5.495865 18.42 34.9 p1 6.671111 2.076623 3.72 10.27 p2 2.3 9307524 3.99 ju y th p0 om ad Max vb lo Min z n Std Dev oi w Mean m Obs va ep Cambodia Variable yi hi Country pl n ua 10 n Indonesia al p1 ll fu at nh 3.220201 z l.c gm 66 n a Lu n va y te re th 60 k Philippines jm Malaysia ht Lao DPR 61 hi ep w Mean Std Dev Min Max Y 91.14667 14.06529 68.82 104.88 gY 2.194432 1.013426 3.573384 G 43.57 1.937298 40.63 46.16 p0 13 5.964616 6.902907 37 21.92 p1 13 1.219231 1.638325 04 5.51 p2 13 3638462 5267279 01 1.83 Y 13 160.3492 37.73632 101.95 220.34 gY 13 2.351309 1.001217 3.445187 13 43.08923 2.194294 39.37 47.86 45.19 10.96016 37.44 52.94 14.005 7.247844 8.88 19.13 5.905 4.235569 2.91 8.9 52.295 4.405275 49.18 55.41 1.419711 2.007774 5.366941 31.93 39.52 17.93868 16.85 63.74 n Obs z ng Variable m t to Country lo ad ju y th Thailand yi pl G n va gY 1.003887 G 35.725 p0 36.66 p1 11.01333 7.40085 3.75 23.57 p2 4.436667 3.642327 1.24 11.01 Y 64.12167 17.43285 gY 3.73716 1.900989 G 36.14667 8378225 35.52 ll Y jm fu oi at nh z ht vb Vietnam p2 n Timor-Leste ua p1 al p0 40.07 85.31 k 37.55 l.c gm 4.972931 om Source: Author’s calculations n a Lu n va y te re th 61 62 t to APPENDIX C: RESULTS OF HAUSMAN TEST ng hi Table C-1 Result of Hausman Test for Equation (4.1a) ep Coefficients (b) (B) FEp0 REp0 w n lo ad -.6932427 0048449 0591558 8637231 355342 -.5781765 -2.54313 1.825156 sqrt(diag(V_b-V_B)) S.E -1.048585 5830214 2.602286 -.9614327 385889 5328493 9450854 3301061 b = consistent under Ho and Ha; obtained from xtreg B = inconsistent under Ha, efficient under Ho; obtained from xtreg ju y th y g Gi_y Yi_g (b-B) Difference yi Ho: difference in coefficients not systematic pl Test: n ua al chi2(4) = (b-B)'[(V_b-V_B)^(-1)](b-B) = 21.84 Prob>chi2 = 0.0002 n va ll fu Table C-2 Result of Hausman Test for Equation (4.1b) m oi Coefficients (b) (B) FEp1 REp1 -1.321863 6393526 3.259809 -1.198802 4548546 6280795 1.11399 3891023 z z -.0899226 0208372 -1.271639 1.429908 sqrt(diag(V_b-V_B)) S.E at -1.411785 6601898 1.98817 2311069 nh y g Gi_y Yi_g (b-B) Difference vb Test: Ho: jm ht b = consistent under Ho and Ha; obtained from xtreg B = inconsistent under Ha, efficient under Ho; obtained from xtreg difference in coefficients not systematic k om l.c gm chi2(4) = (b-B)'[(V_b-V_B)^(-1)](b-B) = 27.18 Prob>chi2 = 0.0000 n a Lu n va y te re th 62 63 t to Table C-3 Result of Hausman Test for Equation (4.1c) ng hi Coefficients (b) (B) FEp2 REp2 ep w y g Gi_y Yi_g n lo ad y th -.3179159 3691171 -.5650993 1.166601 sqrt(diag(V_b-V_B)) S.E -1.386511 5812399 3.408374 -1.238676 4941882 6823927 1.210322 4227499 b = consistent under Ho and Ha; obtained from xtreg B = inconsistent under Ha, efficient under Ho; obtained from xtreg Ho: ju Test: -1.704427 950357 2.843275 -.0720757 (b-B) Difference difference in coefficients not systematic yi chi2(4) = (b-B)'[(V_b-V_B)^(-1)](b-B) = 27.17 Prob>chi2 = 0.0000 pl n ua al va n Table C-4 Result of Hausman Test for Equation (4.2a) ll fu m Coefficients (b) (B) FElnP0 RElnP0 oi (b-B) Difference 1.324086 2.125813 -.2927568 2.015256 2.799852 5873705 z -7.680991 -.8187542 1.208626 at -6.356905 1.307059 915869 nh lnY lnG lnY_lnG sqrt(diag(V_b-V_B)) S.E z Ho: difference in coefficients not systematic om l.c gm chi2(3) = (b-B)'[(V_b-V_B)^(-1)](b-B) = 6.97 Prob>chi2 = 0.0727 k jm Test: ht vb b = consistent under Ho and Ha; obtained from xtreg B = inconsistent under Ha, efficient under Ho; obtained from xtreg n a Lu n va y te re th 63 64 t to Table C-5 Result of Hausman Test for Equation (4.2b) ng hi Coefficients (b) (B) FElnP1 RElnP1 ep w lnY lnG lnY_lnG n -7.932932 1.365335 1.13345 lo -9.403663 -.8947978 1.473485 sqrt(diag(V_b-V_B)) S.E 1.470732 2.260132 -.3400349 2.248967 3.124194 654625 b = consistent under Ho and Ha; obtained from xtreg B = inconsistent under Ha, efficient under Ho; obtained from xtreg ad y th Test: (b-B) Difference Ho: difference in coefficients not systematic ju yi chi2(3) = (b-B)'[(V_b-V_B)^(-1)](b-B) = 5.06 Prob>chi2 = 0.1678 pl n ua al n va Table C-6 Result of Hausman Test for Equation (4.2c) fu ll Coefficients (b) (B) FElnP2 RElnP2 -11.09707 -1.795916 1.806577 sqrt(diag(V_b-V_B)) S.E .7336698 1.276654 -.1282117 2.50746 3.480888 7283355 at -10.3634 -.5192625 1.678366 nh lnY lnG lnY_lnG oi m (b-B) Difference z z b = consistent under Ho and Ha; obtained from xtreg B = inconsistent under Ha, efficient under Ho; obtained from xtreg difference in coefficients not systematic chi2(3) = (b-B)'[(V_b-V_B)^(-1)](b-B) = 3.56 Prob>chi2 = 0.3130 k jm ht Ho: vb Test: om l.c gm n a Lu n va y te re th 64 65 t to APPENDIX D: REGRESSION RESULTS ng hi Table D-1 Estimation Results of equation (4.1a) ep w Fixed-effects (within) regression Group variable: countryid Number of obs Number of groups = = 50 R-sq: Obs per group: = avg = max = 6.3 12 n within = 0.8367 between = 0.4937 overall = 0.6651 lo ad y th corr(u_i, Xb) ju yi p0 Std Err -.6932427 0048449 0591558 8637231 -19.4533 n ua al 3444265 5057791 8458728 3600026 2.659541 -2.01 0.01 0.07 2.40 -7.31 P>|t| 48.68 0.0000 [95% Conf Interval] 0.051 0.992 0.945 0.021 0.000 -1.390498 -1.019051 -1.653224 1349359 -24.83725 0040122 1.028741 1.771536 1.59251 -14.06934 (fraction of variance due to u_i) fu F(7, 38) = 6.06 ll F test that all u_i=0: n 13.768617 10.033675 65314443 t = = va sigma_u sigma_e rho Coef pl y g Gi_y Yi_g _cons F(4,38) Prob > F = 0.0547 Prob > F = 0.0001 m oi Source: Author’s calculation at nh z Table D-2 Estimation Results of equation (4.1b) z Number of obs Number of groups = = 50 R-sq: Obs per group: = avg = max = 6.3 12 ht vb Fixed-effects (within) regression Group variable: countryid k F(4,38) Prob > F = -0.1708 = = p1 Coef y g Gi_y Yi_g _cons -1.411785 6601898 1.98817 2311069 -32.71318 3691258 5420493 9065317 385819 2.850261 sigma_u sigma_e rho 17.956213 10.753206 73603564 (fraction of variance due to u_i) t -2.159042 -.4371316 1529929 -.5499428 -38.48323 -.6645292 1.757511 3.823348 1.012157 -26.94313 n 0.000 0.231 0.034 0.553 0.000 [95% Conf Interval] a Lu -3.82 1.22 2.19 0.60 -11.48 P>|t| om n va F(7, 38) = 8.46 Prob > F = 0.0000 y te re F test that all u_i=0: Std Err 35.90 0.0000 l.c gm corr(u_i, Xb) jm within = 0.7908 between = 0.2156 overall = 0.4549 th Source: Author’s calculation 65 66 t to Table D-3 Estimation Results of equation (4.1c) ng hi ep Fixed-effects (within) regression Group variable: countryid Number of obs Number of groups = = 50 R-sq: Obs per group: = avg = max = 6.3 12 within = 0.7457 between = 0.1486 overall = 0.3478 w n corr(u_i, Xb) F(4,38) Prob > F = -0.2703 = = 27.86 0.0000 lo Coef y th ad p2 -1.704427 950357 2.843275 -.0720757 -41.49734 3920296 5756827 9627807 4097585 3.027116 20.162728 11.420428 75710343 (fraction of variance due to u_i) ju yi t P>|t| -4.35 1.65 2.95 -0.18 -13.71 [95% Conf Interval] 0.000 0.107 0.005 0.861 0.000 -2.498049 -.2150518 8942268 -.9015885 -47.62542 -.9108043 2.115766 4.792322 7574371 -35.36927 F(7, 38) = 9.11 Source: Author’s calculation Prob > F = 0.0000 n va F test that all u_i=0: n ua al sigma_u sigma_e rho pl y g Gi_y Yi_g _cons Std Err ll fu m oi Table D-4 Estimation Results of Equation (4.2a) Number of obs Number of groups = = 56 Obs per group: = avg = max = 7.0 13 at within = 0.8157 between = 0.9882 overall = 0.9471 z R-sq: nh Random-effects GLS regression Group variable: countryid z vb Wald chi2(3) Prob > chi2 = = z -7.680991 -.8187542 1.208626 20.24074 2.377295 2.75332 6372465 10.14815 sigma_u sigma_e rho 08492484 32776702 06291008 (fraction of variance due to u_i) 0.001 0.766 0.058 0.046 [95% Conf Interval] -12.3404 -6.215163 -.0403543 3507432 -3.02158 4.577654 2.457606 40.13074 n a Lu lnY lnG lnY_lnG _cons -3.23 -0.30 1.90 1.99 P>|z| om Coef l.c lnP0 gm Std Err 713.27 0.0000 k jm ht Random effects u_i ~ Gaussian corr(u_i, X) = (assumed) va n Source: Author’s calculation y te re th 66 67 t to Table D-5 Estimation Results of Equation (4.2b) ng hi ep Random-effects GLS regression Group variable: countryid Number of obs Number of groups = = 56 R-sq: Obs per group: = avg = max = 7.0 13 within = 0.8506 between = 0.9914 overall = 0.9579 w Wald chi2(3) Prob > chi2 n Random effects u_i ~ Gaussian corr(u_i, X) = (assumed) = = 957.00 0.0000 lo ad lnP1 Coef y th ju lnY lnG lnY_lnG _cons -9.403663 -.8947978 1.473485 22.37149 z 2.572031 2.961704 6885865 10.93109 yi P>|z| -3.66 -0.30 2.14 2.05 [95% Conf Interval] 0.000 0.763 0.032 0.041 -14.44475 -6.699631 1238798 9469584 -4.362575 4.910035 2.823089 43.79603 pl 08100429 36599089 0466988 al (fraction of variance due to u_i) n ua sigma_u sigma_e rho Std Err n va Source: Author’s calculation fu ll Table D-6 Estimation Results of Equation (4.2c) Number of obs Number of groups = = 56 Obs per group: = avg = max = 7.0 13 at nh R-sq: oi m Random-effects GLS regression Group variable: countryid z within = 0.8568 between = 0.9933 overall = 0.9610 z Random effects u_i ~ Gaussian corr(u_i, X) = (assumed) Wald chi2(3) Prob > chi2 lnP2 Coef lnY lnG lnY_lnG _cons -11.09707 -1.795916 1.806577 26.62826 2.734693 3.120586 7307812 11.54163 sigma_u sigma_e rho 06291415 40253777 02384526 (fraction of variance due to u_i) Std Err z P>|z| 1133.03 0.0000 jm ht vb = = [95% Conf Interval] k -16.45697 -7.912153 3742725 4.007086 -5.737167 4.32032 3.238882 49.24944 om l.c 0.000 0.565 0.013 0.021 gm -4.06 -0.58 2.47 2.31 a Lu n Source: Author’s calculation n va y te re th 67 68 t to APPENDIX E: ESTIMATION OF GROWTH ELASTICITY OF POVERTY ng hi Table E-1: Estimated Coefficients of equation (3.1.3) ep P0 P1 P2 b1 -7.68 -9.40 -11.10 b3 1.21 1.47 1.81 w Coefficient n lo ad y th ju Source: Author’s calculation yi pl Country n ua al Table E-2: Point Estimates of Growth Elasticity of Poverty lnG P1 P2 -3.25 -4.00 -4.47 -3.24 -3.98 -4.45 -4.34 -4.89 -4.23 -4.75 -3.75 -4.17 n va P0 3.67 Cambodia 3.68 Indonesia 3.44 Lao DPR 3.51 -3.43 Malaysia 3.83 -3.05 Philippines 3.77 -3.12 Thailand 3.76 -3.13 Timor-Leste 3.57 -3.37 -4.14 Vietnam 3.59 -3.35 -4.12 ll fu Whole Region oi m at nh -3.53 z z ht vb -4.28 -3.86 -4.30 k jm -4.65 -4.62 om l.c gm n a Lu Source: Author’s calculation -3.84 n va Notes: The growth elasticity of poverty is calculated by using the estimated coefficients of lnY (b1) and lnYlnG (b3) The values of lnG used for computing point estimates is obtained from the sample mean The values of lnG used for calculating interval estimates are the max and value of the sample y te re th 68 69 t to Table E-3: Interval Estimates of Growth Elasticity of Poverty ng hi P0 ep Country lnGmin w n Whole Region lo ad Cambodia y th Indonesia ju P2 max max Max 3.37 3.89 -2.97 -3.61 -3.66 -4.44 -4.06 -5.01 3.58 3.79 -3.10 -3.35 -3.82 -4.12 -4.25 -4.62 3.37 3.57 -3.36 -3.61 -4.14 -4.44 -4.64 -5.01 3.42 3.60 -3.33 -3.55 -4.09 -4.37 -4.59 -4.93 3.89 -2.97 -3.29 -3.66 -4.05 -4.06 -4.53 3.83 -3.05 -3.20 -3.76 -3.95 -4.17 -4.40 -3.01 -3.24 -3.70 -3.99 -4.11 -4.46 -3.24 -3.49 -3.99 -4.30 -4.45 -4.84 -3.37 -4.06 -4.14 -4.55 -4.65 pl 3.64 ua al Malaysia yi Lao DPR P1 lnGmax Thailand 3.67 Timor-Leste 3.46 3.68 Vietnam 3.57 3.63 va n ll fu m -3.30 at nh Source: Author’s calculation 3.87 oi 3.70 n Philippines z z Notes: The terms “min” and “max” in this table refers to and max of absolute value of the elasticity k jm ht vb om l.c gm n a Lu n va y te re th 69