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Within-country poverty convergence: evidence from Mexico

Research output: Contribution to journalArticlepeer-review

Luis F. López-Calva, Eduardo Ortiz-Juarez, Carlos Rodríguez-Castelán

Original languageEnglish
Pages (from-to)2547–2586
Number of pages40
JournalEmpirical Economics
Issue number5
Early online date16 Aug 2021
E-pub ahead of print16 Aug 2021
PublishedMay 2022

Bibliographical note

Funding Information: The authors are grateful to Ted Enamorado for his comments and research assistance. The authors would also like to thank Maria E. Dávalos and Gerardo Esquivel for significant contributions to this work, as well as Oscar Calvo-González, Paloma Anos-Casero, Louise Cord, Jozef Draaisma, Norbert Fiess, Thania de la Garza Navarrete, Rodrigo García-Verdú, Gonzalo Hernández-Licona, Fernando Blanco, Sandra Martínez-Aguilar, Edgar Medina, Pablo Saavedra, Kinnon Scott, Paul Segal, Andy Sumner, Miguel Székely, Gaston Yalonetzky, Robert Zimmerman, officials at CONEVAL and Mexico’s Ministry of Social Development, and participants at the 24th Annual LACEA Meeting 2019 held in Puebla, Mexico, and the EADI Nordic Conference 2017, held in Bergen, Norway, for helpful comments and suggestions. We also thank the editor and two anonymous reviewers for their constructive comments and suggestions, which greatly improved this paper. Publisher Copyright: © 2021, The Author(s), under exclusive licence to Springer-Verlag GmbH Germany, part of Springer Nature.

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Trends in aggregate growth and poverty reduction hide a multiplicity of development processes at the local level. The analysis reported in this paper exploits a unique panel dataset of poverty maps covering almost 2400 municipalities in Mexico and spanning 22 years, first, to test hypothesis that there is within-country income convergence. Second, through a decomposition of the poverty convergence elasticity, the analysis investigates whether this convergence, if it exists, has translated into poverty convergence. In a context of overall stagnant economic growth and poverty reduction since 1990, the analysis finds evidence of both income and poverty convergence among municipalities. As a cause of these, the results point to a combination of positive performance among the poorest municipalities and stagnant or deteriorating performance among more well-off municipalities. Redistributive programs such as cash transfers to poor households have played an important role in driving these results by bolstering income growth among the poorest municipalities, while also inducing progressive changes in the distribution of income.

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