Consumption Poverty and Pro-Poor Growth in Bolivia (1999-2007)

Using seven Bolivian household surveys conducted between 1999 and 2007, this paper provides a different picture of poverty dynamics in Bolivia. Consistent and accurate estimates of consumption are computed and used to create poverty profiles. Challenging the previous income-based poverty trend, it emerges that Bolivia experiences a very large poverty reduction from 2002 onwards, halving poverty headcount during the period of 2002- 2007. Growth incidence curves are also used to investigate the pro-poor component of the large welfare improvement. It shows that the poorest quintiles of the population, mostly represented by indigenous households, did benefit more than the rest of the population. The results suggest that Bolivian pro-poor growth significantly contributed to narrow the welfare inequality between indigenous and non-indigenous groups.