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Séminaire 

Amory Gethin

Distributional growth accounting:
Education and the reduction of global poverty, 1980-2022

Abstract: This article studies the role played by education in the decline of global poverty. In a companion paper, I estimate that the rise of government redistribution in the form of cash transfers, education, healthcare, and other public services accounts for 30% of worldwide poverty reduction since 1980. In this paper, I incorporate in this analysis the causal impact of schooling on pretax incomes, combining survey microdata covering 95% of the world’s population with a simple model of education and the wage structure. Private returns to schooling account for 50-60% of global economic growth, 60-70% of income gains among the world’s poorest 20% individuals, and 60-90% of the decline in global gender inequality since 1980. Combining direct redistribution and indirect investment benefits from education brings the contribution of public policies to global poverty reduction to 50-80% or more.