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Economic Growth and Poverty Reduction in Nepal in last decade Dr Shiva Sharma General Secretary National Labour Academy PowerPoint Presentation
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Economic Growth and Poverty Reduction in Nepal in last decade Dr Shiva Sharma General Secretary National Labour Academy. Nov 20, 2007. Table 1: Trends in the Incidence of Poverty. Source: NESAC (1998). CBS Differences in Poverty line over surveys Comparable data in NLSS I and II

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Economic Growth and Poverty Reduction in Nepal in last decadeDr Shiva SharmaGeneral SecretaryNational Labour Academy

Nov 20, 2007

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Table 1: Trends in the Incidence of Poverty

  • Source: NESAC (1998). CBS
  • Differences in Poverty line over surveys
  • Comparable data in NLSS I and II
  • Difficulty in disaggregated analysis of poverty
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Table 2 : Contribution of Growth and Redistribution of Income in Poverty

  • Source: Computed from the NLSS II poverty results.
  • Decomposition
  • economic growth and [-24.1%]
  • income distribution [ + 13.2%]
  • Had income distribution remained neutral, the decline in poverty would have been more than 24 percentage points.
  • Had there been no growth and income distribution only worsened as shown by the Gini coefficient, absolute poverty would have gone up to 44 per cent
  • Urban areas, inequality not a deterent
  • Had income distribution not worsened in the rural areas, the decline in poverty in rural areas would have been at least 17 percentage points
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Table 3 : Gini Coefficients of Income Distribution Patterns

Income Distribution Pattern

Source: NESAC 1998, NLSS II, CBS.

  • inequality growing over the years
  • rural inequality lower than urban
  • but rural inequality growing faster
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Inequality—household incomes

Inequality—household incomes

Source: NLSS I and NLSS II, CBS.

Inequality measured in terms of share of income of the poorest and the richest households has worsened in the NLSS II survey year 2004 compared to the NLSS I survey year 1996. The Lorenz curve has bulged to the right.

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Table 4: Share of Remittance in Household Income by Consumption Quintile

  • Source: NLSS II, CBS (2004).
  • Poorest 33%
  • Richest 40% of income
  • Poorest might not be having access to external market
  • Will be illuminating to learn:
  • who received and those households who did not receive remittance, and
  • who received lower amount of remittance than those who received higher amount.
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On the whole, the following points reveal the accentuation of inequality in 2004 as compared to 1996 [info in tables below]

  • contraction of the size of operational land
  • increase in the share of rented-in land
  • fall in the consumption share of the poorest 20 per cent
  • slower growth of income vis-a-vis consumption
  • inequality in the receipt from remittances
  • a sharper fall in employment share in agriculture and a modest increase in non-agricultural employment
  • fall in employment share of longer duration