The Determinants of Pro-Poor Growth: Evidence from Brazil

Abstract

Pro-poor growth is good for poverty eradication if it can be achieved. Brazil is a good example of a country where growth was pro-poor between 1981 and 2014 but the pro-poor growth was reversed in 2015. The paper examined what led to pro-poor growth between 1981 and 2014 and what may have been responsible for the reversal in 2015. The dynamic ordinary least squares method was used to analyse Brazilian data from World Bank Development Indicators between 1981 and 2014 for the determinant of pro-poor growth. Regression analysis shows that job creation was responsible for the pro-poor growth between 1981 and 2014. Moreover, rise in unemployment rate in 2015 was responsible for the reversal in the pro-poor growth. The result has good policy implication for poverty and inequality reduction in Brazil.