Open AccessThe Role of Education and Income in Poverty Alleviation: A Cross-Country Analysis
Author(s) -
Pervez Zamurrad Janjua,
Usman Ahmed Kamal
Publication year - 2011
Publication title -
the lahore journal of economics
Language(s) - English
Resource type - Journals
eISSN - 1811-5446
pISSN - 1811-5438
DOI - 10.35536/lje.2011.v16.i1.a6
Subject(s) - poverty , economics , externality , panel data , sample (material) , income distribution , ordinary least squares , distribution (mathematics) , development economics , demographic economics , economic growth , public economics , econometrics , inequality , mathematics , mathematical analysis , chemistry , chromatography , microeconomics
The existing literature on education and poverty considers mostly primary data from an income point of view. However, the benefits of education vary from a direct income effect to positive externalities, which can help reduce poverty. This paper uses panel data for 40 developing countries for the period 1999 to 2007, and estimates coefficients by applying the random effect generalized least squares (GLS) technique. The study concludes, first, that income growth plays a moderately positive role in alleviating poverty, but that income distribution does not play a key role in poverty alleviation in the sample overall. Second, it concludes that education is the most significant contributor to poverty alleviation.