GDP per capita, PPP (current international $)
For Sub-Saharan Africa and Uganda between the years 1980 and 2010.
1. For Sub-Saharan Africa, graph the evolution of the poverty headcount ratio, and GDP per
capita over time.
2. Is an increase in GDP per capita associated with a decrease in poverty?
3. Now graph, in a scatter plot, the poverty headcount ratio as a function of GDP per capita (x-axis: GDP, y-axis: poverty). What do we see?
4. To make it more visual, draw a linear trend (display the equation on the graph). What is the relationship between poverty and GDP?
5. Criticize this result (sample size, linear trend, scarcity of specification, omitted variable bias, reverse causality)
6. If we nonetheless believe this result, let us look at the implications:
a. Graph GDP over time, draw a linear trend, and display the equation
b. If this were to continue, what would be the GDP in 2030?
c. Considering the relationship between GDP and poverty, what would be the poverty rate in 2030?
d. Will there be significant progress on the poverty front, because of an increase in GDP? Conclude in terms of policy implications for poverty-oriented policies.
7. Do the same for Uganda, and conclude for the case of Uganda