Measuring Chronic Poverty, David Hulme (1)

7/28/2019 Measuring Chronic Poverty, David Hulme (1)

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OutlineWhat is chronic poverty?

Global extent and prevalence

Why focus on the chronically poor?Who are they?

Where are they?

Why are people chronically poor?

What does this mean for policy?


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What is chronic poverty?

Distinguished by extended duration: the chronicallypoorare those living below a given poverty line for along time:

Poor for all or much of their lives,

Pass on poverty to subsequent generations, and/or

Die a preventable, poverty-related death.

Chronically poor are commonly multi-dimensionallydeprived. Combinations of capability deprivation, low

levels of material assets, and socio-political marginalitykeeps them poor over long periods.

Relationship between poverty severity and povertychronicity,at both the country and household level, is

complex and only partly understood.


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Chronic poverty is that poverty that is everpresent and never ceases. It is like the rains of the

grasshopper season that beat you consistently

and for a very long time. You become completely

soaked because you have no way out.

Some poverty passes from one generation to

another, as if the offspring sucks it from the

mothers breast. They in turn pass it on to theirchildren.

- Group of disabled women in Nkokonjeru Providence Home,

Mukono, Uganda (source: Lwanga-Ntale 2003).

What is chronic poverty?


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Poverty dynamics

Always poor(BPL in each

period)

Usually poor(mean poverty

over all periods

BPL, not poor in

every period)

Fluctuatingpoor (poor insome periods

but not others,

mean povertyaround poverty

line)

Occasionallypoor(mean

poverty APL but

at least 1 period

in poverty)

Never poor(APL in all

periods)

CHRONICALLY POOR TRANSITORY POOR NON POOR

Povertyline

Mean

score

Time Time Time Time Time


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Poverty dynamics vs. poverty trends

Uganda has experienced significant reduction inpoverty: from 1992 to 1999, aggregate national poverty

rate fell by about 20%. But this aggregate poverty trendtells us nothing about what happened to individual

households.Poverty trends can mask important poverty dynamics:

about 19% of households were poor in both 1992 and

1999 (the chronically poor),

and while almost 30% of households moved out ofpoverty, another 10% moved in (the transitory poor).

This more nuanced understanding of poverty requires

the collection ofpanel data and life histories alongside

the standard household surveys.


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Global extent of chronic poverty

South Asia 135-190 m Highest number of chronicallypoor people

Sub-Saharan Africa 90-120 m Highest prevalence of chronicpoverty (esp. West/ Central

Africa)China 40-65 m Significant numbers remain

Rest of East Asia/Pacific 10-20 m

Latin America/ Caribbean 16-23 m Relatively high proportion of

poor are chronically poorEurope/Central Asia 2-5 m Fastest growth rates of

chronic poverty (esp. Central

Asia and Russia)

Middle East/North Africa 3-5 m

APPROX. 300-420 MILLION CHRONICALLY POOR


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Global extent (size) andprevalence (colour) of chronic poverty

Desperately deprived Moderately deprived

Relatively non-deprived Insufficient data OECD

Deprivation: severe stunting, U5MR, female illiteracy,probability of not surviving until 40, $1/day poverty headcount


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Why focus on thechronically poor?

The moral case

MDGs, and post-MDGs:Some MDGs can never be achieved without reaching the

chronically poor.Other MDGs will be achieved fully or in part byexcludingthe chronically poor. The poverty of those left behind post-2015 will likely be even more intractable.

Grievance-based politics?By denying the poorest those with least to lose we riskundermining political and economic stability

Useful for mobilising political commitment and funds, butremains unproven


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Who are the chronically poor?Discrimination and deprivation

Marginalised ethnic, religious, caste groups, incl.

indigenous, nomadic peoples;

Migrant, stigmatised, bonded labourers;

Refugees, IDPs;Disabled people;

People with ill-health, esp. HIV/AIDS;

To different extents, poor women and girls.

Household composition, life-cycle positionchildren;

older people;

widows;

households headed by older people,

disabled people, children, and, in

certain cases, women


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Where are the chronically poor?Understanding spatial poverty traps

REMOTEAreas far from the centres of economic and political

activity. Far is calculated in terms of distance and

time ( frictional distance).

LOWPOTENTIAL

Areas with low agricultural or natural

resources, often crudely equated with

drylands and highlands.~1.8

billon

peopleLESSFAVOURED

Politically disadvantaged areas

WEAKLYINTEGRATED

Areas that are not well-connected, physically and in

terms of communication and markets. Economically

disadvantaged areas.

Chronic poverty is harshest where spatialand social deprivation overlap.


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Why are people chronically poor?

Context matters

Causes of chronic poverty sometimes same as causes of

poverty, only more intense, widespread, long-lasting. In

other cases, there is a qualitative difference between the

causes of transitory and chronic poverty, requiring different

policies.

Rarely a single cause most chronic poverty due to

multiple, overlapping, interacting factors operating at

levels from intra-household to global.Maintainers: factors that keep people in poverty

Drivers: factors that cause people to slide into poverty

traps


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Why are people chronically poor?Themaintainersand drivers of chronic poverty

Quantity and quality of economic growthNo, low, and narrowly-based growth situations raise theprobability of people being trapped in poverty. But growth isnot almost enough.

For the working chronically poor, sectoral composition of

growth really matters, esp. whether it includes broad-basedagricultural growth and is in sectors with high demand forunskilled labour

The non-working chronically poorare most vulnerable toeconomic shocks, because of their dependance on any

benefits from economic growth derived from a mix of privateand public social protection.

Geography and agro-ecologyGeography and agro-ecology combine with social,economic, political and institutional factors to create spatialpoverty traps


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Social exclusion and adverse incorporationStructures of social exclusion (discrimination, stigma, invisibility)are the basis for processes of adverse incorporation (decliningassets, low wages, job insecurity, minimal access to socialprotection, dependency on a patron).

Risk and vulnerability shape social relations: chronically poorpeople often manage vulnerability by developing patron-clientties that produce desirable, immediate outcomes by trading-offlonger term needs and rights.

Cultures of poverty?Does how people cope with poverty (economically, socially,psychologically) make poverty more difficult to escape?

High capability deprivationNot investing in PHC, nutrition, primary education can diminish

opportunities that cant be regained in later life (or by children)



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Weak and failed/ing statesDesperate deprivation and increased inequality due to:

State failure social protection and services (e.g.education, health) do not operate undermining humancapital.

Violence, weak rule of law destroys assets anddiscourages domestic/foreign investment (except forillegal and extractive activities) so that growth is low/

negative and not pro-poor.Low levels of civil and political rights

Poor economic policies

Weak and failing international system


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Why are people chronically poor?The maintainers anddriversof chronic poverty

Severe, widespread and multiple shocks (driver)along with limited access assets (private/collective)

and a weak institutional contextincluding systems of socialprotection, basic services, conflict prevention and resolution, publicinformation (maintainers)

combine to undermine resilience to shocks, driving people intochronic poverty.

Property grabbing: No safety net to fall back on after ahusbands death (driver), and discrimination based on gender andmarital status (maintainer) strips away any assets that could be

used to bounce back.Malawian famine: Bad weather (a shock), bad policy (a failureof national and international governance), and reduced resilience(due to e.g. HIV/AIDS, poverty-induced asset depeletion)combined to cause hundreds/thousands, of preventable deaths,

and has trapped many more survivors in intractable poverty.


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What can we do aboutchronic poverty?

Much chronic poverty reduction is about goodpoverty reduction

Peace-building and conflict prevention

HIV/AIDS prevention (especially in India, China and the CIS)

and greater access to retroviral treatment (in Africa)Pro-poor, broad-based economic growth

Strengthening national and international governance

Making trade fair (especially removing northern agriculturalprotectionism)

Effectively managing national indebtedness

Slowing down global warming

Improving the effectiveness of basic service delivery

but it also requires new priorities


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What can we do aboutchronic poverty?

Prioritise livelihood security:Increase chronically poor peoples resistance and

resilience to adverse shocks and trends.

Social protection policies are crucialin order to interrupt

downward trajectories and allow opportunities to bepursued (e.g. non-contributory pensions, insurance,

transfers)

Focus on preventing and interrupting childhood poverty

(e.g. interventions in nutrition/health, education, householdsecurity)

Focus on preventing ill-health, and descents into chronicpoverty caused by ill-health (e.g. curative services for

breadwinners and carers)


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What can we do about chronic poverty?

Enhance opportunity:Expand and diversifyeconomic opportunities for chronically poor peopleby:

stimulating broad-based growth (e.g. rural;raised demand for unskilled labour; enhanceshuman capital)

making markets work for poor people (esp.

labour and food markets), andredistributing material and human assets (e.g.land reform; progressive taxation)


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Foster empowerment and make rights realEnhance the capacity of those trapped in povertyto influence state institutions that affect their lives.

Remove the political, legal, social barriers thatwork against them.

Move beyond rhetoric of participation,decentralisation and rights.

Address the difficult political question of howsocial solidarity can be fostered acrosshouseholds, communities and nations (e.g.

monitoring of MDG #8).


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National agendaDelivering basic services: reduce access barriers;improve service quality; foster demand for services amongthe chronically poor

Delivering social assistance: that can have development

as well as relief outcomes requires innovations intargeting, technology, institutions

Using PRSs to prioritse the chronically poor

International agenda

Using MDGs to address chronic povertyFinancing chronic poverty reduction: increase aidvolume; direct aid to poorest countries, social assistanceand basic services; commit to sustained aid


Measuring Chronic Poverty, David Hulme (1)

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