The Unassuming Economist

From the State Council of China:

“nding poverty has long been a major challenge for humanity since ancient times. Today, the world still has more than one billion people living in extreme poverty. In the global war on extreme impoverishment, China has blazed a trail that gives hope to all yearning for a better life.

Being the world’s largest developing country with over 1.4 billion people, China has lifted 800 million out of poverty. It has also met the poverty reduction target of the UN 2030 Agenda for Sustainable Development well ahead of schedule. UN Secretary-General Antonio Guterres lauded China’s achievement as “the greatest anti-poverty achievement in history.”

Centering on “targeted poverty alleviation,” China’s poverty reduction strategy blends rapid economic growth with tangible improvements in well-being. By tailoring solutions to local conditions, it ensures that anti-poverty measures address the specific needs of communities.

This approach has transformed some of the country’s most impoverished regions and offered useful inspiration for other nations grappling with similar challenges.

One example is the introduction of Juncao technology, which has had a transformative impact in countries like Rwanda. Developed as a sustainable method for growing mushrooms using grass, Juncao technology exemplifies China’s ability to provide practical, scalable solutions for global challenges.

In Rwanda, Juncao technology has empowered rural farmers by enabling them to cultivate mushrooms with minimal resources. This has not only diversified income sources for many households but also contributed to food security and environmental sustainability.

Across Africa, Juncao has been adopted in more than 40 countries, improving food security and advancing sustainable farming practices.

China’s contributions to global poverty alleviation extend beyond agricultural innovations. Through initiatives like the Belt and Road Initiative (BRI), China has worked with developing countries worldwide to develop projects in infrastructure, education and healthcare sectors. These projects create jobs, improve connectivity, and foster inclusive growth, helping lift millions out of poverty.

So far, China has provided development aid to over 160 countries, pursued high-quality BRI partnerships with over 150 countries, and backed more than 1,100 projects with about 20 billion U.S. dollars in development funding, injecting vital resources into the economic revitalization of the Global South.

China’s contributions to global poverty alleviation also go beyond financial and technical aid. By strengthening the self-development capacities of developing nations, it has fostered a greater and more sustainable global poverty reduction effort.

To date, China has trained over 400,000 professionals from over 180 countries and regions, boosting their capacity in poverty alleviation and development.

At the recently concluded G20 summit in Rio de Janeiro, Chinese President Xi Jinping outlined China’s eight actions for global development, which include pursuing high-quality Belt and Road cooperation, implementing the Global Development Initiative, supporting development in Africa, and supporting international cooperation on poverty reduction and food security.

Also at the summit, Xi announced China’s decision to join the Global Alliance Against Hunger and Poverty, an initiative designed to raise resources and knowledge to implement proven public policies and social technologies to combat hunger and poverty worldwide.

These actions represent China’s latest commitment to common prosperity and shared development, proving that China will always be a reliable long-term partner of developing countries, and a doer and go-getter working for global development.

Meanwhile, starting Dec. 1, China offers zero-tariff treatment for 100 percent tariff lines to all the least developed countries having diplomatic relations with China. This measure, combined with China’s ongoing efforts to enhance South-South cooperation, underscores its resolve to address systemic inequities in global trade and economic development.

By providing tariff-free access to its vast market, China aims to empower the least developed countries to expand their export capabilities, generate income, and reduce reliance on external aid.

As the world faces mounting challenges such as climate change and economic inequality, China’s poverty alleviation efforts offer valuable lessons. Its model underscores the potential of innovative, localized solutions and international cooperation in building a more equitable and prosperous future for all.”

From McKinsey:

“Our newest McKinsey Global Institute (MGI) report, The next big arenas of competition, tells the story of “wizard” industries that grow at fantastic rates, spawn giants, and even shape-shift. We call them “arenas of competition,” and in the past 20 years, they have come to permeate the global economy.

“If I wind back the clock to 2005, the top ten titans of industry were oil companies, retailers, pharmaceuticals…and one software company, Microsoft. The average market cap was $250 billion,” recalls Chris Bradley, a McKinsey senior partner and MGI director. “Today, nine out of the top ten have been replaced by companies that are giant—eight times bigger in value—at 1.9 trillion, and almost all are driven by new technologies and business models. Under our noses, there’s been this radical shift in the industrial landscape, and we wanted to understand why and what it looked like.”

The report identifies 12 thriving arenas that began in 2005 and previews 18 that we think could shape the future. Here, four authors, Chris; Kweilin Ellingrud, a McKinsey senior partner and MGI director; Kevin Russell, an MGI senior fellow; and Suhayl Chettih, an engagement manager, share insights from the research.”

Continue reading here.

From mint:

“There is a strong business case for inclusive leadership. Research carried out by BCG points out that inclusive leaders cut down employee attrition risk by as much as 76 per cent. Reports over the years have also correlated diverse leadership teams to not only a boost in morale, productivity, psychological safety, and belonging which results in talent retention, but also a significant improvement in financial performance.

While year-on-year business growth remains critical, McKinsey’s latest study also highlights how organisations today are keen on driving holistic impact. This values the interests and needs of all stakeholders – employees, customers and investors. Moreover, with GenZ entering the workforce, prioritising ESG goals, and a shift towards sustainable, inclusive growth become part of this changing picture.”

Continue reading here.

From a paper by Iyanuoluwa Fatoba and Adewumi Otonne:

“This study aims to investigate fiscal policy shocks’ impact on Nigeria’s Income Inequality and
Household Poverty. Using the impulse response function and variance decomposition technique
within the Bayesian Vector Autoregressive framework (BVAR), findings from the study show that
from year 2 to 15, a 1% shock to tax revenue (i.e., when taxes are suddenly changed) generates a
reduced average impact of 0.036% on household poverty. In contrast, household poverty increases
with shocks to government expenditure (i.e., when government expenditures are suddenly altered) in
the short run, with an average impact of 0.022%. In other words, household poverty increases in the
short run (years 2 to 4) and decreases in the medium to long run (years 5 to 15) with shocks to
government expenditure. Similarly, the results show that shocks to tax revenue reduce income
inequality (years 2 to11), and it increases the gap between the rich and the poor in the long run (years
12 to 15). Meanwhile, shocks to government expenditure increase the gap between the rich and the
poor in the short to medium run (year 2 to 6) while decreasing the gap in the medium to long run
(year 7 to15). The implication of these findings suggests that shocks to tax revenue directly benefit
low-income families and individuals in Nigeria. Moreover, as unanticipated alteration of government
expenditure increases household poverty and income inequality in the short run to medium run, any
shock to government expenditure (internal or external) should be combated with pro-poor policy
action.”

From a paper by Jerome Creel, and Jonas Kaiser:

“This paper investigates the stabilization property of fiscal policy by revisiting the notion of
potential output via the use of Okun’s Law including the vacancy-to-unemployment ratio (V/U)
to proxy economic slack. We propose new measures of the US fiscal stance based on observable
data and transparent targets. Our results suggest that the US actually had a more conservative
fiscal stance than official data indicate. This paper also examines fiscal multipliers, which are
larger when V/U, rather than the unemployment rate, is used as measure of economic slack. We
find that state-dependence of fiscal multipliers is as sensitive to thresholds for bad years than
to the slack measure employed in Okun’s Law.”