Growth, Urbanization and Poverty Reduction in India
Longstanding development issues are revisited in the light of our newly-constructed dataset of poverty measures for India spanning 60 years, including 20 years since reforms began in earnest in 1991. We find a downward trend in poverty measures since 1970, with an acceleration post-1991, despite rising inequality. Faster poverty decline came with both higher growth and a more pro-poor pattern of growth. Post-1991 data suggest stronger inter-sectoral linkages: urban consumption growth brought gains to the rural as well as the urban poor and the primary-secondary-tertiary composition of growth has ceased to matter as all three sectors contributed to poverty reduction.
For comments the authors thank Frederico Gil Sander and seminar participants at the University of Waikato, New Zealand, and the World Resources Institute, Washington DC. These are the views of the authors and do not necessarily represent those of their employers, including the World Bank, any of its member countries, or the National Bureau of Economic Research.