It is notable that the Gini index of nominal per capita consumption increased at an annual rate of 2.5 percent, whereas that of real per capita consumption increased at 2.7 percent, which implies that changes in relative prices between 1992-93 and 1997-98 had an effect of increasing inequality, favoring the rich more than the poor. The above results clearly show that there has been a sharp increase in inequality in Lao PDR. The benefits of economic growth have thus not been flowing uniformly across the population. The proportional benefits received by the poor are less than those by the rich. real consumption for each quintile, constructed on the basis of per capita real is evident from Table 8, which presents the growth rates of per capita consumption. As also noted earlier, per capita real consumption in Lao PDR grew at an annual rate of 2.5 percent between 1992-93 and 1997-98, but the annual growth rate of the bottom 20 percent population was 0.3 percent, while that of the top 20 percent population was 4.2 percent. Economic growth in Lao PDR thus led to a reduction in the standard of living of the bottom quintile of the population. Thus, growth has not been good for the poor in Lao PDR, contrary to what may have been expected based on cross county studies such as Dollar and Kraay (2001), Table 8: Growth rate of per capita real consumption by quintiles Quintite 1992-93 < 1997-98 Growth rate Fist 2386 2325 03 Second 3.296 3.486 10 Thies 4125, 47 Fourth 5.489 17 ith 10.228 All Quinties 25.494 6. Poverty To analyze poverty, the construction of poverty lines on a consistent basis is of fundamental significance. We constructed a new set of poverty lines based on the nutritional norm of 2100 calories per day per person. The poverty lines are set following a cost of basic needs approach, whereby the food poverty line is anchored to an energy 13