Sectoral composition of growth and poverty reduction in Peru: A regional approach (2001-2016)

Using GDP data disaggregated by region and sector, this paper examines the impact of the sectoral composition of growth on poverty reduction in Peru during the period 2001-2016, finding a considerable variation in the poverty-reducing effectiveness of growth across sectors, across space, and over time. The regressions appoint that growth in services sector had more direct poverty reducing effect than growth in either agriculture, mining or industry. Intersectoral relationships also have a significant impact on poverty reduction. Also, initial conditions related to human development affected the dynamics of poverty reduction. These results support the hypothesis that the sectoral structure of economic growth affects poverty independently from overall economic growth.