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Inter-Governmental Panel on Climate Change

In the last two decades, developing countries have outstripped developed countries when it comes to economic growth. In many places around the world, that economic growth has fueled reductions in poverty levels. And yet, many countries around the world continue to suffer from high poverty rates even as the monetary value of all the finished goods and services produced within their borders, or gross domestic product (GDP), continues to grow.

Atlas-award winner Augustin Kwasi Fosu at the University of Ghana examined these trends in regions and countries around the world in an articlepublished in Research in Economics. The hope is that his analysis can now serve as a roadmap for further study and continued efforts to reduce poverty around the world.

“In some countries, there’s been tremendous growth, but because of an increase in inequality or an initial inequality that’s so high, the poverty reduction outcome has been quite discouraging,” Fosu said. “We can try to understand what are the variables that might have contributed to this outcome and how changes can be made to ensure next time an increase in growth can be transformed into higher poverty reduction.”

Fosu analyzed regional trends in GDP growth and poverty reduction for the periods 1981-1995 and 1996-2005. He selected those two time periods because of a clear shift in the mid-1990s, when economic growth in developing nations took off. The question Fosu sought to explore was how that increasing growth at the level of entire countries has played out in terms of income growth and poverty reduction.