DECEMBER 14, 2013
⇐RETURN TO AGENDA
About the Author:
Erik Thorbecke is the H.E. Babcock Professor of Economics Emeritus and Graduate School and International Professor at Cornell University and one of the creators of the Foster-Greer-Thorbecke (FGT) metric for measuring poverty.
Professor Thorbecke is also former Director of the Program on Comparative Economic Development at Cornell, and he is a longstanding member of the Advisory Board for the Cornell Institute for African Development. His past positions include Chairman of the Department of Economics at Cornell, a professorship at Iowa State University, and associate assistant administrator for program policy
at the Agency for International Development. In 1981, Professor Thorbecke was awarded an honorary doctorate degree by the University of Ghent. He has made contributions in the areas of economic and agricultural development, the measurement and analysis of poverty and malnutrition, the Social Accounting Matrix and general equilibrium modeling, and international economic policy. The Foster-Greer-Thorbecke poverty measure (Econometrica 1984) that he developed (with James Foster and Joel Greer) has been adopted as the standard poverty measure by the World Bank and many UN agencies and is widely used by researchers doing empirical work on poverty. A variant of the FGT was adopted by the Mexican government and used to allocate federal government funds to educational, health, and nutrition programs benefiting the poor. Since the early 1990s, he has been closely associated with the African Economic Research Consortium, a “public, not-for-profit organization devoted to the advancement of economic policy research and training.” He serves as the Chairman of the Thematic Research Group on “Poverty, Income Distribution and Food Security.” Over the past several years (2005–2010), Professor Thorbecke has been co-directing (with Machiko Nissanke) a large-scale research project on “The Impact of Globalization on the World’s Poor” under the auspices of the United Nations University’s World Institute for Development Economics Research. He is the author or co-author of more than 25 books and over 150 articles.
The Present Pattern of Growth, Inequality and
in Sub-Saharan Africa
Can inclusive growth in Africa contribute to a more pro-poor globalization process? This is the main question the paper would try to answer.
In the last decade economic growth has been remarkable in sub-Saharan Africa (SSA). Of the ten fastest growing economies, six were in SSA. The process of globalization has definitely contributed to a high GDP growth which has been fueled, among others, by high prices for commodities, an acceleration in the inflow of foreign capital, improved governance and an apparent (temporary) reduction in inter-ethnic conflicts. The high pace of growth has led to a reduction in poverty but at rates much lower than in other developing regions. The pattern of growth has tended to be narrowly focused on a few resource extractive sectors with relatively little employment creation. Likewise, much of the capital inflow has been directed to obtaining access to resources and land at terms often favoring the foreign investors. It is not yet clear that this pattern of growth is sustainable.
On the positive side, African governments are presently embracing a more inclusive growth pattern that would be broadly based and help all segments of society. The proposed inclusive growth strategy would rely on providing more equal opportunities to the poor and destitute (e.g. through education, improved health and nutrition) and on creating new productive jobs. By complementing the process of globalization with an appropriate inclusive growth strategy, the impact of globalization on poverty and inequality reduction could become much stronger.
There is some evidence that the structural transformation in a number of SSA countries during the recent growth spell has been more inclusive and more in line with the highly successful Asian historical pattern than prior to 2000 when it was essentially flawed. Workers moving out of agriculture appeared to get slightly more productive jobs in other sectors. Employment creation remains the sine qua non of a successful and sustainable growth pattern in SSA.
Download PRESENTATION POWERPOINT (PDF)