A major discrepancy exists between figures on economic growth in poor countries on the one hand, and statistics on global poverty on the other. Are the growth figures too optimistic, or the poverty figures too pessimistic? One likely reason for this gap is the Purchasing Power Parity (PPP) adjustment undertaken in order to make real income or poverty data internationally comparable. Methods for PPP adjustment are disputed, and recent research has indicated that growth in poor countries may have been exaggerated. This project studies the price structures in poor countries: what explains them, how they are affected by development and globalisation, and how they affect the measurement of poverty.
Research Council of Norway