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SDFeaturesPovertyandSD

CausesofPovertyAGDRCcompilationofarticleson

thecausesofpovertyandrelatedissues.

I.Typesofcausesofpoverty.A.Individual

Povertyisexplainedbyindividualcircumstancesand/orcharactersticsofpoorpeople.Someexamplesare:

amountofeducation,skill,experience,intelligence.health,handicaps,age.workorientation,timehorizon,cultureofpoverty.discrimination,togetherwithrace,sex,etc.

B.Aggregate

Therearetwotypesofaggregatepovertytheory:caseandgeneric.Thereisnoagreementonwhichisthecorrectexplanationofmostpoverty.

1.Case.Addupallpovertyexplainedbyindividualtheories,andthatisequaltototaloraggregatepoverty.Inotherwords,accordingtocasetheoriesofpoverty,individualandaggregateexplanationsarereallythesame.Accordingtothesetheories,aggregatepovertyisjustthesumofindividualpoverty.

2.Generic.Povertyisexplainedbygeneral,economywideproblems,suchas

inadequatenonpovertyemploymentopportunitiesinadequateoveralldemand(macroproblems,macropolicy)lownationalincome(LessDevelopedCountry)

Ifgenerictheoriesarecorrect,povertyiscausedbyonesetofforces(general,economywideproblems)butdistributedaccordingtoindividualtheories.

II.Casevs.GenericTheoriesofPoverty

A.Whatdifferencedoesitmakewhetherpovertyiscausedbycaseorgenericcauses?

Answer:Itmakesalotofdifference.

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Example#1:Supposesomehowwesignificantlyreduceracialdiscrimination.Willtotalpovertyfall?

Caseanswer:Yes.

Genericanswer:No.Povertywillonlyberedistributed.

Example#2:Supposewegivepoorpeopleeffectiveskilltrainingandcompensatoryeducation.Willtotalpovertyfall?

Caseanswer:Yes.

Genericanswer:No.Povertywillonlyberedistributed.

B.Whatcanyoudoaboutpoverty?

1.Ifcasetheoriesarecorrect:Addresstheindividualcauseofpoverty.Forexample,ifpovertyiscausedbyinadequateskillsoreducation,thenthesolutionisskilltrainingorcompensatoryeducation.Ifpovertyiscausedbydiscrimination,thenthesolutionisantidiscriminationpolicies.

2.Ifgenerictheoriesarecorrect:Improvethequantityandqualityofjobs.

C.Howcanyoutellwhichiscorrectcaseorgenerictheories?

1.Rememberthatthethingsthatcausepovertyincasetheoriesexplainitsdistributioningenerictheories.Becauseofthis,boththeoriesareconsistentwiththesamefacts(statistics).Therefore,itisverydifficult,maybeimpossible,todeterminewhichiscorrectthroughdirecttest.

2.There'ssomeindirectevidencepointingtogenerictheories:Forexample,thereisthefailureofpovertytofallduringperiodsoflargetrainingprograms,andthefailureofpovertytofallwithriseingeneraleducationallevelofpopulation.Furtherindirectevidencelateroninthecourse.

3.Mostpeopleassumecasetheoriesarecorrect.Why?

Microexperience(fallacyofcompositionassumingthatwhat'strueofthepartmustbetrueofthewhole).Povertyscholarsstudythepoorinsteadoftheeconomy.Antipovertypolicywouldbetoohard(expensive)ifgenerictheoriesweretrue.Blamingthevictim.Adesiretohelpthepoor.(P.S.Ifgenerictheoriesaretrue,howcanyouhelpthepoor?)

Source:MaxwellSchool,SyracuseUniversity

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Acutecausesofpoverty:

Warfare:Thematerialandhumandestructioncausedbywarfareisamajordevelopmentproblem.Forexample,from1990to1993,theperiodencompassingDesertStorm,percapitaGDPinIraqfellfrom$3500to$761.Thedropinaverageincome,whileastrikingrepresentationofthedropinthewellbeingoftheaverageIraqicitizenintheaftermathofthewar,failstocapturethebroaderaffectsofdamagestotheinfrastructureandsocialservices,suchashealthcareandaccesstocleanwater.

AgriculturalCycles:Peoplewhorelyonfruitsandvegetablesthattheyproduceforhouseholdfoodconsumption(subsistencefarmers)oftengothroughcyclesofrelativeabundanceandscarcity.Formanyfamiliesthatrelyonsubsistenceproductionforsurvival,theperiodimmediatelypriortoharvestisa'hungryperiod.'Duringtheseperiodsofscarcity,manyfamilieslacksufficientresourcestomeettheirminimalnutritionalneeds.Beingfamiliarwiththesecycleshasenableddevelopmentpractitionerstoanticipateandprepareforperiodsofacuteneedforassistance.

DroughtsandFlooding:Besidestheimmediatedestructioncausedbynaturaleventssuchashurricanes,environmentalforcesoftencauseacuteperiodsofcrisisbydestroyingcropsandanimals.

NaturalDisasters:Naturaldisasterssuchashurricanesandearthquakeshavedevastatedcommunitiesthroughouttheworld.Developingcountriesoftensuffermuchmoreextensiveandacutecrisesatthehandsofnaturaldisasters,becauselimitedresourcesinhibittheconstructionofadequatehousing,infrastructure,andmechanismsforrespondingtocrises.

Entrenchedfactorsassociatedwithpoverty:

ColonialHistories:Oneofthemostimportantbarrierstodevelopmentinpoorcountriesislackofuniform,basicinfrastructure,suchasroadsandmeansofcommunication.Somedevelopmentscholarshaveidentifiedcolonialhistoryasanimportantcontributortothecurrentsituation.Inmostcountrieswithahistoryofcolonization,thecolonizersdevelopedlocaleconomiestofacilitatetheexpropriationofresourcesfortheirowneconomicgrowthanddevelopment.

CentralizationofPower:Inmanydevelopingcountries,politicalpowerisdisproportionatelycentralized.Insteadofhavinganetworkofpoliticalrepresentativesdistributedequallythroughoutsociety,incentralizedsystemsofgovernanceonemajorparty,politician,orregionisresponsiblefordecisionmakingthroughoutthecountry.Thisoftencausesdevelopmentproblems.Forexample,inthesesituationspoliticiansmakedecisionsaboutplacesthattheyareunfamiliarwith,lackingsufficientknowledgeaboutthecontexttodesigneffectiveandappropriatepoliciesandprograms.

Corruption:Corruptionoftenaccompaniescentralizationofpower,whenleadersarenotaccountabletothosetheyserve.Mostdirectly,corruption

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inhibitsdevelopmentwhenleadershelpthemselvestomoneythatwouldotherwisebeusedfordevelopmentprojects.Inothercases,leadersrewardpoliticalsupportbyprovidingservicestotheirfollowers.

Warfare:Warfarecontributestomoreentrenchedpovertybydivertingscarceresourcesfromfightingpovertytomaintainingamilitary.Take,forexample,thecasesofEthiopiaandEritrea.Themostrecentconflictoverbordersbetweenthetwocountrieseruptedintowarduring1999and2000,aperiodwhenbothcountriesfacedseverefoodshortagesduetodrought.

Environmentaldegradation:Awarenessandconcernaboutenvironmentaldegradationhavegrownaroundtheworldoverthelastfewdecades,andarecurrentlysharedbypeopleofdifferentnations,cultures,religions,andsocialclasses.However,thenegativeimpactsofenvironmentaldegradationaredisproportionatelyfeltbythepoor.Throughoutthedevelopingworld,thepooroftenrelyonnaturalresourcestomeettheirbasicneedsthroughagriculturalproductionandgatheringresourcesessentialforhouseholdmaintenance,suchaswater,firewood,andwildplantsforconsumptionandmedicine.Thus,thedepletionandcontaminationofwatersourcesdirectlythreatenthelivelihoodsofthosewhodependonthem.

SocialInequality:Oneofthemoreentrenchedsourcesofpovertythroughouttheworldissocialinequalitythatstemsfromculturalideasabouttherelativeworthofdifferentgenders,races,ethnicgroups,andsocialclasses.Ascribedinequalityworksbyplacingindividualsindifferentsocialcategoriesatbirth,oftenbasedonreligious,ethnic,or'racial'characteristics.InSouthAfricanhistory,apartheidlawsdefinedabinarycastesystemthatassigneddifferentrights(orlackthereof)andsocialspacestoWhitesandBlacks,usingskincolortoautomaticallydeterminetheopportunitiesavailabletoindividualsineachgroup.

Source:MSUWomenandInternationalDevelopment

AddressingtheUnderlyingCausesofPoverty

Buildingamorewidespreadcommitmenttoovercomingpovertyisanessentialfirststepinovercomingpoverty,andactionstoaddressthisarediscussedbelow.

Sharethebenefitsofeconomicgrowththroughanemphasisonmorewidespreademployment.Thephenomenonofjoblesseconomicgrowththatincreasesincomeinequalitiesandgeneratestoofewjobsforlowincomegroupsposesaseriousthreattothewellbeingofmanynations,bothNorthandSouth.Governmentpoliciesshouldconsidernotonlyaggregateeconomicimpactbutalsothedistributionofemployment.Sociallyresponsibleventurecapitalandmicrocreditinitiativescanfosteremploymentgeneratingbusinessesthatcomplementthelocalcultureandenvironment.

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Routoutcorruption,whichharmssocietyasawhole.Corruption,bothingovernmentandbusiness,placesheavycostonsociety.Businessesshouldenact,publicizeandfollowcodesofconductbanningcorruptiononthepartoftheirstaffanddirectors.Citizensmustdemandgreatertransparencyonthepartofbothgovernmentandthecorporatesectorandcreatereformmovementswhereneeded.

Broadenaccesstoeducationandtechnologyamongmarginalizedgroups,andespeciallyamonggirlsandwomen.Theeducationalattainmentofwomenhasstrongbearingonthewellbeingoftheirfamilies,andeffortstoimproveeducationforwomenandgirlsmustbestrengthened.Atthesametime,stepsshouldbetakentoensurethatthecurrentrevolutionininformationtechnologybenefitsmarginalizedgroups.Thismustbegininschool.

Improvegovernmentcapacitytoprovideuniversalaccesstoessentialgoodsandservices,includingpotablewater,affordablefood,primaryhealthcare,education,housingandothersocialservices.Governmentsaroundtheworldhavemadecommitmentstothisthroughthe20/20Initiative,whichcallsfor20%ofnationalbudgetsand20%offoreignaidtobespentonhumanservices.Butraisingadequateresourcesthrougheffectivetaxationandothermechanismsisoftenpoliticallydifficult.Newmechanismsforpublicpolicydialoguethatenablecitizensofallclassestorecognizethebenefitofuniversalaccesstokeyservicesmustbeputinplace.Nonprofitgroupsandevencorporationscanprovideessentialsupporthere,helpingarticulateavisionofahealthysociety.Thesenongovernmentalactorscanalsohelpintheactualprovisionofservices.

Source:SynergosUniversityforaNight

AdditionalResources:GlobalIssuesWorldBank:PovertyNetUNDP:Poverty

Reduction

Doyouhaveanysuggestionsforresourcesorsupplementaltextfortheabove?Suggestionsarewelcome!SendanemailtoHariSrinivasat:hsrinivas@gdrc.org

Doyouhaveanycommentstomake?Pleasesendthembyemaildetailsbelow.

"Shouldweinsteadbeasking'Whatcauseswealth??'Whatisitthatpullspeopleoutofpoverty?Howcanopportunitiesbecreatedforlowincomepeopletoimprovetheircondition?Whatwillmotivatethem?Noeasyanswers..."

Dr.TonyWalsh,USA

http://www.globalissues.org/TradeRelated/Poverty.asphttp://www.undp.org/poverty/mailto:hsrinivas@gdrc.org?subject=GDRC%20Feedback&body=Re%20http://www.gdrc.org/sustdev/causes-poverty.htmlhttp://www.worldbank.org/poverty/

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"Haveyouconsideredthetheoriesofthecausesofpovertyfromtheperspectivethatthecausesofpovertyarelayeredintointernational,national,nationallocal,andindividuallevels?Theinteractionsbetweentheeconomic,social,informational,culturalandpoliticalfactorsattheinternational,national,nationallocalandindividuallayerhavetoprovidethejob,sothattheinteractionsbetweentheeconomic,social,informational,culturalandpoliticalfactorsatthenational,nationallocalandindividuallayercanprovideasuitablyequippedindividualtotakeadvantageofthejob.(internationallayerwouldalsobeincludedifforexampleinternationalNGOs,UN,etc...gotinvolvedwiththecountry).Ateachlevelofabstraction,eitherindividual,nationallocal,national,orinternational,therearearangeoffactorsthatinteractwithinandbetweenthelevelsofabstractionthatinfluencethecreationofcorrectlyskilledindividuals,thecreationofopportunitiesforthoseindividualstoexploit,thecreationofthemeansforthosecorrectlyskilledindividualstoexploitthewealthgeneratingoppurtunites,andlastlythedesiretodoso.Thereforeweseefourimportantmetricsgeneratedbytheinterplayoffactorswithinandbetweenthedifferentlevelsofabstraction,withnosinglemetricbeingdeterminedbyanyonesinglelevelofabstractiontheseare:Skills,Opportunity,Means,andDesire.

NickWestbury,UK

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