What does the growth elasticity of poverty reduction tell us

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Reference no: EM131679253

Assignment

In this assignment, you will find and analyze data on the poverty rate at $1.90/day, the poverty rate at $3.10/day, and the Gini index for China and India. You will compare the countries and try to explain the reasons behind the differences between them.

Datasets:

World Bank World Development Indicators

Background data collection and analysis:

1. Download data on the poverty rate at $1.90/day and $3.10/day for China and India for the earliest year available (1981 for China, 1983 for India) and the latest year available (2013 for China, 2011 for India). Use the series Poverty headcount ratio at $1.90 a day (2011 PPP) (% of population) and Poverty headcount ratio at $3.10 a day (2011 PPP) (% of population).

2. Download GDP per capita for the same year as the poverty data (use GDP per capita (constant 2010 US$)), and examine the relationship between GDP per capita and the poverty rate.

3. Ravallion (2010) calculates the growth elasticity of poverty reduction. Calculate this variable for both China and India by dividing the percentage change in the $1.90-a-day poverty rate (over the longest period available) by the percentage change in per-capita GDP over the same period. Measure the percentage changes using the compound annual growth rate (CAGR) formula given in Assignment 1.

4. Download the Excel spreadsheet provided (Assignment3_Gini.xlsx) showing the Gini index for China, India, and Canada for the earliest and latest years available (1981 for China and Canada, 1983 for India as the earliest years; 2010 for Canada, 2011 for India, and 2012 for China as the latest years).

Essay:

In your essay, describe the changes over time in poverty and inequality in China and India. Compare the two countries to each other, and discuss the reasons why you believe these countries have experienced these changes over time. What government policies does Ravallion (2010) identify that have affected poverty and inequality in China and India? What does the growth elasticity of poverty reduction tell us?

Your essay must have a title, an introduction, a conclusion, and a data appendix. Make sure to define all terms and provide appropriate background information.

The maximum length is 500 words plus a two-page data appendix; include a word count at the end of your submission. Include the grading rubric as the first page of your submission. Use Chicago or APA style, and write in 11 or 12 point font, double-spaced, with one-inch margins. You must submit a hard copy (in class) by the deadline. Late submissions will be penalized at 20% per day, starting immediately.

Reference no: EM131679253

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