Has Economic Growth in Mozambique been Pro-Poor?

Abstract

Using the 1996–7 and 2002–3 nationally representative household surveys, we examine the extent to which growth in Mozambique has been pro-poor. Although all segments of the income distribution experienced a rapid increase in consumption between the sample periods, the rate of growth in consumption was slightly higher for richer households. This has led to a moderate increase in inequality at the national level, as demonstrated by the rise in the Gini coefficient from 0.40 to 0.42. However, this slight increase in inequality at the national level is not statistically significant, and its impact on poverty reduction efforts is small: the poverty headcount would have been 53.0% in 2002–3 if all sections of society had enjoyed the mean growth rate in consumption, compared with the 54.1% at which it actually stood. Interestingly, static decompositions of the generalised entropy class of inequality measures indicate that inequality in real consumption between provinces and regions has diminished over time, in contrast to popular claims. Maputo City continues to have the highest rates of inequality in the country and witnessed a significant increase in inequality between 1996–7 and 2002–3 (the Gini coefficient rose from 0.44 to 0.52).