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Theoretical and Applied Economics
No. 3 / 2024 (640), Autumn

Structural transformation, poverty, and inequality in emerging countries

Nihel FRIKHA
University of Sfax, Tunisia
Foued Badr GABSI
University of Sfax, Tunisia

Abstract. This study makes a valuable contribution to the existing literature by examining the impact of structural transformation on poverty reduction in 13 emerging economies during the period 2008-2018. The research utilizes a generalized method of moments (GMM) dynamic panel regression technique to identify the key drivers of poverty and inequality reduction. The findings reveal that structural change significantly contributes to poverty and income inequality reduction in the emerging economies under consideration. Specifically, the service sector and industry sector play pivotal roles in eradicating poverty and income inequality in these countries. However, the results suggest also that the agricultural sector may not be the most efficient means of reducing poverty and inequality in emerging economies. To increase its impact on poverty reduction, it is crucial to modernize and transform the agricultural sector into an agribusiness.

Keywords: emerging countries, GMM, inequality, poverty, structural transformation.

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The Economicity. The Epistemic Landscape, Marin Dinu, 2016

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