Unveiling the connection: Impact of economic growth on poverty reduction in Angola (1990-2020)

Resumo

This article, titled "Unveiling the Connection: Impact of Economic Growth on Poverty Reduction in Angola from 1990 to 2020," aims to analyze the relationship between economic growth and the reduction of poverty rates in the Angolan context over three decades. Methodologically, the article employed the ARDL (Auto-Regressive Distributed Lag) model based on historical data to capture the short- and long-term dynamics between the variables. The methodological approach utilized allowed for the estimation of the error correction coefficient, which presented a value of -0.746, indicating a rapid convergence towards equilibrium after economic shocks. It was found that the short-term and long-term impact of GDP_PC is not statistically significant (p>0.05), suggesting that the benefits of economic growth did not robustly translate into poverty reduction. The analysis of the control variables, shows divergence between short and long-term impacts for education spending. It demonstrates that while the immediate effects of education spending on poverty are ambiguous or even negative, its sustained, long-term impact is powerful and highly effective in reducing poverty; Health spending has, to date, been an ineffective strategy, requiring urgent reform, and unemployment remains a key structural barrier, confirming that a pro-poor growth strategy must be, by definition, a pro-employment strategy. Finally, this article, shows that Angola´s economy is not simply failing to connect growth to poverty reduction by accident; it is structurally hardwired to do so.