Poverty reduction measures are generally intended to create shared prosperity and wellbeing as a means of ending poverty. This however, can only take place through economic growth, a well-designed business environment and the development of an industrial sector. Poor business environments may even have a disproportional negative effect on women-owned businesses, which are more likely to remain informal, extending the poverty trap.
Experiences from the past decade show that shared prosperity was in most cases based on progress made in absorbing the labor force more effectively into higher income industrial jobs of a growing manufacturing sector. Extending this experience to the developing world means that it should likewise experience poverty reduction if the same changes can be brought about.
Economic growth, trade and industrial development have the potential to simultaneously increase employment opportunities and increase labor productivity. Technology is diffused through standards among others, and productivity is increased by their use. On the other hand, rigid or burdensome regulations and conformity assessment procedures effectively limit competition or market entry, choices for consumers are diminished, and this can have a negative price effect, especially for the poor.
