Economic growth and poverty in sub‑Saharan African countries: non‑linearity and exports threshold effect

Abstract

This study investigates how economic growth translates into poverty reduction in Sub-Saharan Africa (SSA) using NARDL and PSTR models with data from 31 countries (2000–2022). Results show a significant long-run negative relationship between GDP growth and poverty, with nonlinear dynamics confirmed. The PSTR analysis identifies an export threshold of 22.2% of GDP, beyond which growth significantly reduces poverty. Below this level, GDP growth has only a modest effect on poverty. The transition speed between regimes is slow (γ = 0.076), implying a gradual adjustment as exports approach the threshold. Findings highlight that growth alone is insufficient for poverty alleviation without export expansion. The study recommends export-oriented trade policies, trade facilitation, SME incentives, and structural reforms to help SSA countries reach the export threshold more rapidly, thereby enhancing the poverty-reducing effects of economic growth.