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Kyrgyz Republic Poverty and Inequality in 2009 Sarosh Sattar Europe and Central Asia Region The World Bank October 6, 2011. Outline of presentation. Motivation Objectives Developments in poverty and inequality over 2006-2009 Poverty profile: selected characteristics

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Kyrgyz Republic

Poverty and Inequality

in 2009

SaroshSattar

Europe and Central Asia Region

The World Bank

October 6, 2011


Outline of presentation
Outline of presentation

  • Motivation

  • Objectives

  • Developments in poverty and inequality over 2006-2009

  • Poverty profile: selected characteristics

  • Concluding remarks


Motivation
Motivation

  • Opportunity to show the importance of micro data to really understand what is happening to the population in the Kyrgyz Republic

  • Economic growth does not benefit all groups equally therefore it is important to look at disaggregated data


Objectives
Objectives

  • To monitor development’s in the population’s welfare – especially those who are the most vulnerable

  • A descriptive report which complements the National Statistical Committee’s publication on poverty indictors

  • Stimulate interest by raising more questions than are answered


Dynamics of Poverty

& Inequality,

2006 - 2009


Economic context large movements in macroeconomic aggregates
Economic ContextLarge movements in macroeconomic aggregates




Growth improved the livelihoods of lower income groups more
Growth improved the livelihoods of lower income groups more….




Inequality fell as measured by the gini coefficient
Inequality fell as measured by the the previous yearGini coefficient



Macro and micro points
Macro and micro points of the population

  • What we know….

    • Before 2008 economic growth and remittances went hand in hand with falling poverty rates

    • In 2009 there were dramatic changes in growth, remittances, and public expenditures and poverty remained level

  • What we don’t know

    • Why the bottom 40 percent of the population benefited the most in 2006-2009.

    • What economic developments occurred that were “pro-poor” and are they a result of government policies?


A puzzle
A puzzle….. of the population

Why using household level data raises interesting questions for policy makers… and example





What could be happening
What could be happening…. in rural areas?

  • Farm income rose due to high food price increases but volume didn’t change

  • Non-farm income is rising

  • Remittances could have increased substantially

  • …. Or something else


Another puzzle
Another puzzle….. in rural areas?

Large differences across regions and large changes over just a few years….




Poverty rates and mean consumption are strongly correlated
Poverty rates and mean consumption are strongly correlated by oblast

Osh’s poverty rate is relatively high


Obvious questions
Obvious questions by oblast

  • Why is there such high diversity among mean consumption levels and poverty rates across oblasts?

  • What factors could explain this?

    • Private sector development?

    • Education and productivity of labor?

    • Government spending?

  • Why are changes in poverty rates so dramatic but different across oblasts?


POVERTY by oblastPROFILE

2009







Extreme poor more dependent on social assistance, but no significant difference between poor and nonpoor



Concluding Thoughts head): negative relationship


Key messages
Key Messages head): negative relationship

  • Macroeconomic developments had a significant impact on the population’s living standards and the welfare of low income groups

  • Many interesting and unresolved issues of poverty and development

  • A large research agenda remains that could help policy makers pursue more thoughtful solutions


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