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PRWP

Reproducibility Package for Are the Poorest Catching Up?

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Reference ID
RR_WLD_2024_62-v1
DOI
https://doi.org/10.60572/t2gb-r488
Author(s)
James Frederick Cust, Alexis Rivera Ballesteros
Collections
World Bank Policy Research Working Papers
Metadata
JSON
Created on
May 07, 2024
Last modified
May 22, 2024
  • Project Description
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  • Overview
  • Reproducibility Package
  • Description
  • Scope and coverage
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  • Access and rights
  • Contacts
  • Information on metadata
  • Citation
  • Overview

    Abstract

    Are global incomes converging or diverging? Despite recent empirical evidence supporting the hypothesis of unconditional beta convergence, this paper argues that such findings overlook the stark reality facing the world’s poorest people. Many lower income countries, including those among the so-called “Bottom Billion,” continue to slip further behind the rest of the world, while the numbers of those living in extreme poverty are beginning to rise again after decades of decline. The paper explores how these contradictions can coexist and discusses the policy importance of looking beyond global average trends. The paper identifies three confusions that can arise when analyzing trends in income convergence. First, a focus on unconditional convergence can overlook important policy questions, such as whether countries are likely to eradicate extreme poverty or to catch up with the rest of the world. Tests for convergence may yield only partial answers, especially in light of recent findings that show that unconditional beta convergence can coexist with a significant group of countries slipping ever further behind the rest of the world. Meanwhile extreme poverty numbers are increasing rather than decreasing. Second, average trends can both obscure and be distorted by underlying differences in country composition. In the extreme case, while fast-growing China was below global mean incomes between 2000 and 2020, it significantly boosted empirical support for global convergence. Now that China has passed this threshold, the finding will likely reverse in the coming years as more data is available. Third, different levels of availability of time periods and country coverage can distort and even bias empirical findings, especially where limitations to data availability is correlated with lower income or diverging economies.

    Reproducibility Package

    Scripts
    Readme Get Reproducibility Package
    Link: https://reproducibility.worldbank.org/index.php/catalog/135/download/362/README.pdf
    Reproducibility package for Are the Poorest Catching Up?
    Title
    Reproducibility package for Are the Poorest Catching Up?
    Date
    2024-01
    Software
    Stata 18
    Dependencies
    Required Stata packages are included in the ado folder.
    Instructions
    See README in reproducibility package
    Notes
    Computational reproducibility verified by the Development Impact (DIME) Analytics team, World Bank.
    Software
    Stata
    Name
    Stata
    Version
    18

    Reproducibility

    Technology requirements

    5 min runtime

    Reproduction instructions

    Follow the instructions in README.

    Data

    Datasets
    World Bank’s World Development Indicators 2023
    Name
    World Bank’s World Development Indicators 2023
    Note
    Filename: wdi.dta Located at: \Data\clean It contains macroeconomic indicators obtained from the World Bank’s World Development Indicators 2023 update via the DataBank API for Stata. The indicators used are: NY.GDP.MKTP.KD – GDP (constant 2015 US$), NY.GDP.PCAP.KD – GDP per capita (constant 2015 US$), NY.GDP.MKTP.PP.KD – GDP, PPP (constant 2017 international $), SP.POP.TOTL – Population (total), NY.GDP.TOTL.RT.ZS – Total natural resources rents (% of GDP), SP.POP.GROW – Population growth (annual %), NY.GNP.MKTP.KD – GNI (constant 2015 US$), NE.GDI.FTOT.KD – Gross fixed capital formation (constant 2015 US$),
    Data URL
    https://data.worldbank.org/
    Penn World Table 10.0
    Name
    Penn World Table 10.0
    Note
    File name: pwt100.dta Located at: \Data\base This data contains GDP and other macroeconomic indicators from Penn World Table 10.0.
    Data URL
    https://www.rug.nl/ggdc/productivity/pwt/pwt-releases/pwt100?lang=en
    World Bank's Poverty and Inequality Platform data
    Name
    World Bank's Poverty and Inequality Platform data
    Note
    Filename: pip.csv Located at: \Data\base This data contains surveyed income data from World Bank's Poverty and Inequality Platform. The data is downloaded from the Poverty and Inequality Indicators dashboard, selecting 2011 as the base year from the top dropdown menu, and hitting the "Download all country data" from the download options at the bottom of the left sidebar.
    Data URL
    https://pip.worldbank.org/poverty-calculator
    Lakner and Milanovic (2013)
    Name
    Lakner and Milanovic (2013)
    Note
    Filename: lm_wpid_web.dta Located at: \Data\base This data contains the inputs to replicate the analysis from [Lakner and Milanovic (2013)]
    Data URL
    https://www.worldbank.org/en/research/brief/World-Panel-Income-Distribution
    Changing Wealth of Nations 2021
    Name
    Changing Wealth of Nations 2021
    Note
    Filename: CWON2021 Country Tool - Full Dataset.xslx Located at: \Data\base This data contains wealth accounting data from the Changing Wealth of Nations 2021 report. Click on the link in "An Excel country tool found here." on the website.
    Data URL
    https://www.worldbank.org/en/publication/changing-wealth-of-nations/data
    World Bank Commodity Markets data
    Name
    World Bank Commodity Markets data
    Note
    Filename: CMO-Historical-Data-Monthly.xlsx Located at: \Data\base This data contains data on commodity prices from World Bank Commodity Markets data. Click on the "Monthly prices"
    Data URL
    https://www.worldbank.org/en/research/commodity-markets#1
    Analysis data from Patel, Sandefur, and Subramanian(2021)
    Name
    Analysis data from Patel, Sandefur, and Subramanian(2021)
    Note
    Filename: combined_data.dta Located at: \Data\base This data contains the inputs to replicate the analysis from Patel, Sandefur, and Subramanian(2021) . The replication code and data are obtained from this link that the authors provided in their Working Paper version.
    Data URL
    https://www.dropbox.com/s/qrw06liqtil6a2r/Replication_files.zip?e=2&dl=0
    WDI indicators
    Name
    WDI indicators
    Note
    Filename: si.pov.dday.csv Located at: \Data\base This data contains the Poverty headcount ratio at $1.90 a day (discountinued) series that are no longer part of the WDI indicators, due to a change in the methodology of poverty estimation.
    Data URL
    https://data.worldbank.org/indicator/SI.POV.DDAY
    Bottom Billion group in Collier (2009)
    Name
    Bottom Billion group in Collier (2009)
    Note
    Filename: bb_countries.dta Located at: \Data\base This data contains the list of countries that are classified as part of the Bottom Billion group in Collier (2009)
    Data URL
    https://www.amazon.com/Wars-Guns-Votes-Democracy-Dangerous/dp/0061479640
    OECD Countries (2023)
    Name
    OECD Countries (2023)
    Note
    Filename: oecd.dta Located at: \Data\base This data contains the list of OECD countries as of December 2023 listed in the OECD official webpage.
    Data URL
    https://www.oecd.org/about/document/ratification-oecd-convention.htm
    World Bank’s PovCalnet data
    Name
    World Bank’s PovCalnet data
    Note
    Filenames: f_povhc_bygroup.dta , h_povhc_bygroup.dta, and povhc_byregion.dta Located at: \Data\clean These are datasets with historical and projected poverty headcount estimates constructed from country-year estimates from multiple sources that include publicly available data from World Bank’s PovCalnet data but also from other sources that are not public including World Bank’s Global Poverty and Inequality Data team and linear interpolation for gap filling.
    Data URL
    https://www.worldbank.org/en/topic/poverty
    Data statement

    All data are obtained from public sources except the data required to produce figures 13, 14, 16, and 17, where we only report aggregated data.

    Description

    Output
    Are the Poorest Catching Up?
    Type
    WP
    Title
    Are the Poorest Catching Up?
    Authors
    James Cust, Paul Collier and Alexis Rivera-Ballesteros
    Description
    PRWP 10622
    URL
    https://documents.worldbank.org/en/publication/documents-reports/documentdetail/099257212012320427/idu04b6e9b6e0a87504b5d09a0b0012bb203154e
    DOI
    10.1596/1813-9450-10622
    Authors
    Author Role Affiliation Email
    James Frederick Cust Senior Economist World Bank jcust@worldbank.org
    Alexis Rivera Ballesteros Consultant World Bank ariveraballester@worldbank.org

    Scope and coverage

    Geographic locations
    Location Code
    World WLD
    Keywords
    Economic Growth Convergence Inequality Poverty
    Topics
    ID Topic Vocabulary
    O40 Economic Growth and Aggregate Productivity: General JEL Classifications
    O15 Economic Development: Human Resources; Human Development; Income Distribution; Migration JEL Classifications
    O47 Empirical Studies of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence JEL Classifications
    E01 Measurement and Data on National Income and Product Accounts and Wealth; Environmental Accounts JEL Classifications

    Disclaimer

    Disclaimer

    The materials in the reproducibility packages are distributed as they were prepared by the staff of the International Bank for Reconstruction and Development/the World Bank. The findings, interpretations, and conclusions expressed in this event do not necessarily reflect the views of the World Bank, the Executive Directors of the World Bank, or the governments they represent. The World Bank does not guarantee the accuracy of the materials included in the reproducibility package.

    Access and rights

    License
    Name URI
    Modified BSD3 https://opensource.org/license/bsd-3-clause/

    Contacts

    Contacts
    Name Affiliation Email
    Alexis Rivera Ballesteros World Bank ariveraballester@worldbank.org
    Reproducibility WB World Bank reproducibility@worldbank.org

    Information on metadata

    Producers
    Name Abbreviation Affiliation Role
    Reproducibility WBG DIME World Bank - Development Impact Department Verification and preparation of metadata
    Date of Production

    2024-01

    Document version

    1

    Citation

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