Can find final version at: http://www.fairobserver.com/360theme/pondering-poverty
A discussion of poverty immediately throws up the conundrum of
identifying and aggregating poverty to guide policy. The multi-dimensional
nature of poverty is not as obvious as intuition suggests. The more popular
definitions of the concept stem from perceptible impacts such as starvation. The
inability to obtain the minimum nutritional requirements to facilitate physical
efficiency (Rowntree, 1991) motivates a biological approach. Albeit this is
undeniably parochial- wider concepts account for income inequality, relative
deprivation, epidemiological factors, education, the environment and the
freedom to attain well-being. Sen’s
capabilities approach is the most wholesome approach to understanding poverty,
yet its characteristic ambiguity confounds statisticians. Measurement has conventionally
therefore been limited to narrow definitions. Even so, effective policy
response would need to transcend statistical limitations, and recognize the
deep nature of the problem.
The adoption of eight Millennium Development Goals represents a global
commitment to comprehensively address the problem, in a time-bound manner. The
eight goals include eradicating
poverty and hunger, universal primary education, gender equality, child health,
maternal health, combating HIV/AIDS, environmental sustainability, and global
partnership for development. The goals were arrived at through a series of summits
across the 1990’s and the joint effort of UN members countries, the OECD, IMF,
and World Bank, finally culminating in the Millennium Summit in 2000.
According to the World Bank, nearly 1.3 billion people
on our planet live in extreme poverty, as per the US $1.25 income per day
poverty line computed at PPP. The $2 a day measure of deprivation, estimates
twice this number. Approximately three quarters of the world’s poor reside in
Sub-Saharan Africa and South Asia. The 2011 progress report on the MDGs paints
a mixed picture. The sharp reduction in poverty in East Asia (China, in
particular), supplemented by gains in India have led to a substantial decline
in global poverty. The 2015 global estimate of poverty is 15%, well below the
23% target. Projections for Sub-Saharan Africa are also more optimistic than
before, despite the global economic slowdown augmented by food and fuel crises.
Markedly, the best record for pursuing the goal of universal primary education
is that of Sub-Saharan Africa (1990-2009). Joint efforts of international
partners, governments, civil society, and public health workers have helped
effect substantial improvement by making treatment for HIV, tuberculosis and
malaria accessible to millions of patients. Access to clean drinking water and
a renewed focus on maternal and child health has also helped reduce worldwide
deaths attributed to disease.
However, there are pertinent concerns about the
reliability of data. The variability in analytical techniques across countries,
small sample sizes and vested interests make it difficult to obtain credible
estimates. Income inequality continues to broaden unabashedly with the growth
trajectory of developing nations. Volatility in food and fuel prices, food
shortages, environmental degradation and economic shocks further obstruct
development. Furthermore, there is disturbing evidence that the conditions of
the poorest sections is only getting worse. The most vulnerable are
disadvantaged compared to others below the poverty line where access to limited
resources of sanitation, education, food rations, public health and clean
drinking water are concerned. Theory
suggests that the headcount ratio mode of aggregating poverty may in part be
responsible for such a phenomenon. Women and children are among the worst
affected, as a consequence.
The
multiplicity of anti-poverty programmes oft leaves observers baffled. These
programmes can be divided based on a one-size-fits-all approach versus one that
is more region/institution specific. Policy need not confine itself to either
approach exclusively, of course. Development aid, part of the former genre,
reflects the approach of the international community to help impoverished
countries escape the ‘poverty trap’. This method has met with varied results,
and has consequently been the centre of a controversial academic debate (Sachs
vs. Easterly). The opposing party argues that aid is ineffective, encourages
perpetual dependence and undermines local institutions. Neither side has succeeded
in unequivocally establishing their case.
Microfinance
received international recognition after the Nobel Committee recognized Yunus
for the Grameen Bank’s pioneering work in Bangladesh. These schemes helped
extend organized credit to the informal sector, finding innovative ways around
the traditional impediments of collateral, lack of creditworthiness, default,
etc. However, it is incorrect to regard this tool as a panacea as there is
little evidence that microfinance has actually helped lift people out of
poverty; albeit it has facilitated greater financial freedom for its clients.
Another scale-based
approach promotes ICT4D, i.e. Information and Communication Technologies for
Development. This involves the use of technology to address issues in
agriculture, health, banking, education, etc. Since the adoption of MDGs,
cellular phones have also begun to play an important role. The successful
M-PESA scheme in Kenya, for instance, has helped incorporate more than half of
Kenya’s adult population within the formal banking network. However, the
feasibility of replicating one-off technologically supported successes depends
on the extent of institutional heterogeneity. There is an intriguing line of
thought that questions the underlying premise of prioritizing technology
altogether (Toyama, Boston Review).
The
various solutions (not exhaustive) listed above all motivate the same query-
does it work? Following this line of reasoning there has been an increasingly
popular shift towards evidence-based policy in development economics, which
uses statistical tools to assess the impact of policy interventions. The
necessarily micro nature of this exercise, however, is a limitation for
large-scale projects and grand solutions. Simply put, your questions about
interventions will still receive qualified ‘yes and no’ answers. There is no
single magic cure.
