Poorer but less poor : notes on the Philippine poverty trends 2000-2003

This paper attempts to shed light on the debate sparked by the seemingly conflicting trend from 2000 to 2003 where we note a decrease in real incomes accompanied by a decrease in poverty incidence. A comparison of income and expenditure figures across space and over time gives us two important lessons: The first is that in order to have a radical impact on poverty reduction, we really need to bring the economy to a higher growth path. The second is that lapses in economic performance, even if only momentary, are costly in terms of poverty reduction efforts. We recommend that a comprehensive poverty alleviation program should include a macro growth strategy, efforts to improve linkages between the high-growth and broad-based sectors of the economy, and measures to address vulnerabilities among those who will graduate out of poverty.