Growth Elasticity of Multidimensional Poverty in India Between 2005/06 and 2015/16
Mon, 8 March, 2021
10:00am - 11:15am
Monday, March 8, 2021
10:00am – 11:15am
via WebEx
Post-reform India has generated high economic growth, yet progress in income poverty and many other key development outcomes has remained modest. This paper seeks to explore how inclusive has Indian economic growth been in terms of reducing multidimensional poverty between 2005-06 and 2015-16, employing a constellation of elasticity and semi-elasticity measures – each capturing different forms and components of inclusivity. We assess multidimensional poverty by the well-known Multidimensional Poverty Index (MPI). A growth elasticity measure captures the percentage change (relative) in a target variable due to a one percent economic growth; whereas, a growth semi-elasticity measure captures the absolute change in a target variable due to a one percent economic growth. Our estimates show that, nationally, a one percent annual economic growth during the study period is associated with 0.0027 units (absolute) or 1.34 percent (relative) annual reduction in the MPI. Our estimates of horizontal inclusiveness, assessed by the change in state MPIs associated with a one percent of national economic growth, show a wide variation across states. For instance, for every one percent national economic growth, the MPI in Bihar falls only by 0.96 percent, but the MPI in Kerala falls by 3.79 percent. Our analyses and application in the paper demonstrate the efficacy of these tools for measuring inclusiveness of economic growth in terms of reducing multidimensional poverty as well as inform policy.
Co-sponsors:
Oxford Poverty and Human Development Initiative (OPHI)
UNDP Human Development Report Office
About the Presenter:
Dr. Suman Seth is an associate professor at the Leeds University Business School. He joined the business school in 2015. He is also a Research Associate at the Oxford Poverty and Human Development Initiative (OPHI) within the Oxford Department of International Development at the University of Oxford. He obtained a PhD degree in Economics from Vanderbilt University in the USA. After his PhD, he served as a Research Office and as a Senior Research Officer at OPHI between 2010 and 2015. He is primarily interested in Development Economics with a particular emphasis on measurement methodologies and policy-oriented applications. Previously, he has served as consultants to the Regional Bureau of Latin America and the Caribbean, United Nations Development Programme (UNDP), to the Development Research Groups at the World Bank, and to the Asian Development Bank.
About the Discussant:
Ajay Chhibber is Distinguished Visiting Scholar, Institute for International Economic Policy, Elliott School of International Affairs, George Washington University and Non-Resident Senior Fellow, the Atlantic Council, Washington DC.
He was the Chief Economic Advisor, Federation of Indian Chambers of Commerce and Industry (FICCI). He was earlier the first Director General (Minister of State) , Independent Evaluation Office, Government of India and Distinguished Visiting Professor at the National Institute of Public Finance and Policy (NIPFP), India – affiliated institute of the Ministry of Finance – where he completed a major study on India’s Public Sector Enterprises.
He held senior positions at the UN as Assistant Secretary General and Assistant Administrator, UNDP and managed their program for Asia and the Pacific. At the World Bank he served as Country Director in Turkey and Vietnam and Division Chief for Indonesia and the Pacific and Lead Economist, West Africa Department. He was also Director of the 1997 World Development Report on the Role of the State. He also worked in the World Bank’s Research Department, as Advisor to the Chief Economist of the World Bank and at the Public Economics Division.
He has a Ph. D from Stanford University, a Masters from the Delhi School of Economics. He also has attended advanced management programs at the Harvard Business School, Harvard University and INSEAD, France. He taught at Georgetown University and at the University of Delhi. He has published widely including 5 books in development economics, and is a contributor (columnist) to several newspapers.
He is now writing a book on “India: A Reset for the 21st Century” under contract with Harper-Collins.
About the Moderators:
Sabina Alkire directs the Oxford Poverty and Human Development Initiative (OPHI), a research centre within the Oxford Department of International Development, University of Oxford. Dr Alkire works on a new approach to measuring poverty and well-being that goes beyond the traditional focus on income and growth. This multidimensional approach to measurement includes social goals, such as health, education, nutrition, standard of living and other valuable aspects of life. She devised a new method for measuring multidimensional poverty with her colleague James Foster (OPHI Research Associate and Professor of Economics at George Washington University) that has advantages over other poverty measures and has been adopted by the Mexican Government, the Bhutanese Government in their ‘Gross National Happiness Index’ and the United Nations Development Programme. Dr Alkire has been called upon to provide input and advice to several initiatives seeking to take a broader approach to well-being rather than just economic growth, for example, the Commission on the Measurement of Economic Performance and Social Progress (instigated by President Sarkozy); the United Nations Human Development Programme Human Development Report Office; the European Commission; and the UK’s Department for International Development.
James E. Foster is the Oliver T. Carr, Jr. Professor of International Affairs, Professor of Economics, and Co-Director of the Institute for International Economic Policy at the George Washington University. He is also a Research Associate at the Oxford Poverty and Human Development Initiative at Oxford University. Professor Foster’s research focuses on welfare economics — using economic tools to evaluate and enhance the wellbeing of people. His work underlies many well-known social indices including the global Multidimensional Poverty Index (MPI) published annually by the UNDP in the Human Development Report, dozens of national MPIs used to guide domestic policy against poverty, the Women’s Empowerment in Agriculture Index (WEAI) at USAID, the Gross National Happiness Index of Bhutan, the Better Jobs Index of the InterAmerican Development Bank, and the Statistical Performance Index of the World Bank. Prof. Foster received his PhD in Economics from Cornell University and has a Doctorate Honoris Causa from Universidad Autónoma del Estado Hidalgo (Mexico).
About the Event Series
The Institute for International Economic Policy (IIEP) at George Washington University and the Oxford Poverty and Human Development Initiative (OPHI), with the support of the United Nations Development Programme’s Human Development Report office (UNDP HDRO), are pleased to host a special seminar series on the global Multidimensional Poverty Index (global MPI). Goal 1 of the Sustainable Development Goals (SDGs) is to end poverty in all its forms and dimensions. The global MPI 2020 offers a tool to make progress towards this goal.
Produced in partnership with the UNDP HDRO, the global MPI 2020 compares acute multidimensional poverty for 107 countries in developing regions and provides a detailed image of who is poor and how they are poor. It offers both a global headline and a fine-grained analysis covering 1,279 sub-national regions, and important disaggregation such as children, and people living in urban or rural areas, together with the indicator deprivations of each group. Bringing together the academic and policy spheres, this series of seminars will highlight topics such as sensitivity analyses, overlapping deprivations, changes over time (poverty trends), and inequality using the global data. The sessions will also include work that applies the global MPI methodology, the Alkire Foster method, to innovative measures.
The seminars are taking place online on Mondays at 10 a.m. EST. They will be hosted by IIEP Co-Director Professor James Foster and are open to everyone focused on improving the lived experience of those who are deprived.