Journal of African Economies Advance Access originally published online on March 27, 2006
Journal of African Economies 2007 16(1):70-101; doi:10.1093/jae/ejk018
Growth and Poverty in Burkina Faso: A Reassessment of the Paradox
a Department of Economics, University of Göttingen, Platz der Göttinger Sieben 3, 37073 Göttingen, Germany
b DIW, Berlin
c DIAL, Paris
* Michael Grimm is the corresponding author, e-mail: mgrimm{at}uni-goettingen.de
Previous poverty assessments of Burkina Faso neglected some important methodological issues. They were therefore misleading and led to the so-called Burkinabè GrowthPoverty Paradox, i.e., increasing poverty despite sustained macro-economic growth and constant inequality. We estimate that poverty significantly decreased between 1994 and 2003, i.e., growth was in contrast to what previous poverty estimates suggested pro-poor. However, we also demonstrate that between 1994 and 1998, poverty indeed increased despite a good macro-economic performance. This was caused by a severe drought and the devaluation of the CFA Franc, which led to a profound deterioration of the purchasing power of the poor, an issue, which was also overseen by previous studies.
JEL classification: D12 D63 132 O12