Poverty reduction has been adopted as the official objective of many multilateral and bilateral development … poverty. It argues that reduction of absolute poverty should be one of the objectives of foreign assistance, but not the sole … objective. First, measures of absolute poverty are highly limited in scope. Second, the resources of foreign aid are fungible …

The authors develop a macroeconomic framework that captures links between aid, public investment, growth, and poverty … impact of policy shocks on poverty by linking the model to a household survey. They calibrate the model for Ethiopia and … should increase to reach the poverty targets of the Millennium Development Goals. …

P.T. Bauer boldly conjectured two hypotheses about the process of escaping poverty. First, he argued that foreign aid …

, growth, and poverty. Public investment is disaggregated into education, infrastructure, and health, and affects both … goods. The authors assess the impact of policy shocks on poverty by linking the model to a household survey. They calibrate … the amount by which foreign aid should increase to reach the poverty targets of the Millennium Development Goals. This …