Thus, it is extremely important to determine the effects that each of these factors exerts on poverty. Since growth alone cannot explain alterations in poverty levels, we treat income inequality as a factor in these, seeking to evaluate the hypothesis that the more unequal a country is, the less effective economic growth will be at reducing poverty (Bourguignon, 2003). These latter variables are estimated by applying a dynamic econometric panel data model developed by Arellano and Bond (1991), Arellano and Bover (1995) and Blundel and Bond (1998).