Changes in unrelated variety and climbing the poverty ladder: a U-shaped relationship

Abstract

The purpose of this paper is to study how changes in unrelated variety influence individuals’ poverty alleviation. Drawing on the LiTS III database, we employed the Oprobit model to test 5007 individual-level observations from 23 regions in four former Yugoslavian countries. All results imply that the changes in unrelated variety have a U-shaped relationship with individuals’ poverty alleviation. Our findings enrich the unrelated variety research by providing micro-level evidence and offer practical insights for governments, organizations and individuals aiming to reduce poverty.