Poverty Reduction and SAM Multipliers: An Evaluation of Public Policies in a Regional Framework

The objective of this paper is to obtain several poverty reduction effects by using multipliers based on social accounting matrices. Expressions relating them to Foster, Greer and Thorbecke poverty measures were derived, and two simulations were carried out for the Spanish region of Extremadura. In the first, we posited a per capita transfer equivalent to certain social policy instruments already existing in this region. Structural path analysis is also used to determine the paths by which poverty reduction effects are transmitted. In the second, we calculate the minimum government expenditure in transfers needed to reduce the regional poverty indices to the national values. The results confirmed that the main feature of poverty in Extremadura is incidence.