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inclusive growth

How can Latin America and the Caribbean keep up inclusive growth?

Louise Cord's picture
The Latin America and Caribbean (LAC) region has been the most inclusive region in the world over the last decade: not only did it cut extreme poverty in half, it also realized the highest income growth rate among the bottom 40 percent of income earners in absolute terms, as well as relative to the total population. Between 2006 and 2011, the average growth rate per year in the mean income of LAC’s bottom 40 was approximately 5.2%. Moreover, when compared with the rest of the world, the region’s bottom 40 enjoyed the most rapid income growth relative to the total population (Figure 1).

Inclusive growth for shared prosperity

Vinaya Swaroop's picture
Announced in April 2013, the twin global goals of the World Bank – eliminating extreme poverty by 2030 and boosting shared prosperity – have become the guiding principles of its development work.  While reducing poverty has always anchored the Bank’s work, the goal of boosting shared prosperity – measured by the income of the bottom 40 percent – is new.

Inclusive Growth Revisited: Measurement and Evolution

Saurabh Mishra's picture

Inclusive growth refers to both the pace and distribution of economic growth. For growth to be sustainable and effective in reducing poverty, it needs to be inclusive (Berg and Ostry 2011a, Kraay 2004). Traditionally, poverty (or inequality) and economic growth analyses have been conducted separately. Recent work indicates that there may not be a trade-off between equity and efficiency, as suggested by Okun (1975), and “that it would be a big mistake to separate analyses of growth and income distribution” (Berg and Ostry 2011b). Ianchovichina and Gable (2012) describe inclusive growth as raising the pace of growth and enlarging the size of the economy by providing a level playing field for investment and increasing productive employment opportunities.