Growth, redistribution and poverty changes in Cameroon: A Shapley decomposition analysis

This paper studies the decomposition of poverty changes in Cameroon. Specifically, it reviews theoretical frameworks for growth-redistribution decomposition analyses, presents the data and poverty measures and estimates the growth-redistribution components of changes in measured poverty by the Shapley value-based approach using Cameroon's household surveys. By all the P-alpha class of measures, poverty increased significantly between 1984 and 1996. The growth components overaccounted for the increase, although shifts in national, rural and semi-urban distributions marginally mitigated the worse effects on the population. A decline in mean incomes as well as adverse distributional shifts contributed to a significant increase in urban poverty during the same period. These findings corroborate the general information in the literature that growth effects tend to dominate the effects of changes in the distribution of income. These results illustrate the potential contribution of distributionally neutral growth in household incomes to poverty alleviation in Cameroon. Although redistribution also has an important role to play, it should be accepted that there must be severe limits to what can be achieved by growth neutral redistribution. Growth in household incomes appears more likely to be essential for long-term poverty reduction and will be more effective if poverty alleviation programmes are targeted disproportionately in favour of rural and semi-urban areas.