The net change in poverty over any period of time is a resultant of two separate trends: some previously poor people escape from poverty and some non-poor people become poor at the same time. Different reasons can (and do) account for people escaping from poverty and people falling into poverty. So it is important to examine these two distinct trends separately.
Investigations conducted in 35 villages in the Indian state of Rajasthan show that members of 11 percent of households in these villages have overcome poverty in the last 25 years. However, members of another 8 percent of these 6,376 households have fallen into poverty at the same time. One set of factors is associated with households’ escape from poverty, but another and different set of factors is associated with households’ decline. Similar results were obtained also in inquiries carried out in western Kenya and in the Indian state of Gujarat. (All of these papers are available on this website).
Because escaping poverty and falling into poverty are caused by different factors, looking only at the figure for net change will not help to develop appropriate policy responses. The net change in poverty over any period of time is obtained by subtracting one causal stream (escape) from another and separate causal stream (descent). It does not as such have an independent causal significance. Any given figure for net change can be arrived at under very different circumstances, for example, a 3 percent net reduction over a ten-year period can arise because (A) three percent of the population escapes from poverty and no one previously non-poor falls into poverty during this time; or (B) eight percent of the population escapes from poverty while five percent descend into poverty; or (C) 20 percent escape from poverty while 17 percent fall into poverty during this time.
All of these situations show up as equivalent if one looks only at the figure for net decline over this period. However, very different conditions underlie these three different situations, and very different policy sets will be required to deal with each of them. Situation (A) might require faster growth as the antidote to the observed slow pace of poverty reduction, but Situation (C) will certainly require first paying attention to the large ongoing decline. It helps little to promote people escaping from poverty if as many fall under as clamber out from below.
Reasons for escape and reasons for decline will both need to be individually addressed. Designing appropriate policy will require first disaggregating poverty statistics into their component parts.
Disaggregating by escape and by decline is just the first step in this process. Disaggregating by region (and reason) is the next important step. What are some natural break lines in profiling poverty by region? How does one go about dividing countries into regions that share common reasons within their boundaries for escape and for decline – but significantly different reasons operate across these regional boundaries? Such exercises have rarely (if ever) been undertaken. But how without doing so does one know the extent to which a common poverty policy should be applied within any area?
Units of data availability – countries, states within countries – have been regarded quite uncritically as appropriate units for analyzing and dealing with poverty. It has rarely been examined whether the convenience of data availability coincides in any way with reality as it is lived.
Poverty does not exist in a vacuum. It exists because we – as analysts – bring it into being. The definitions that we provide and the measurements that we promote give poverty space and existence that it did not have before. Yes, poverty exists even without our seeing it or measuring it. But the ways in which we see it and measure it configure the reality that it takes on. Statements such as – “poverty declined by five percent in Country X between 1995 and 2000” – have no meaning other than those that we provide to them.
And the meanings that we provide to poverty along with the measures that we adopt lead to the policies we implement in order to deal with poverty as we know it. That we have not been very successful in dealing with poverty over the past fifty years owes something to the meanings that we have provided to this term.
We have chosen to measure poverty in our terms – as a calorific mean, as a dollar-per-day equivalent – and we have elected to treat whole countries as the appropriate units for analysis using these measures. These decisions of ours structure reality in particular ways.
These are not the only ways in which we could have selected to study poverty. Yet we selected these ways because they allowed us to standardize poverty and to compare progress across different countries of the world. The definition and measures that we have selected are particularly useful for these purposes. But they are not very helpful for some other purposes, more directly connected with observing poverty and addressing its causes in diverse domains.
Poverty is an objective condition that is experienced subjectively. More than a condition, it is a relationship – between a person and her possessions and between this person and other persons. Like other relationships, poverty is socially constructed and collectively defined. Individuals’ understandings and their aspirations follow from this shared societal construction of poverty. A person who is considered poor in one societal context may or may not be thought poor in some other and different context.
Individuals’ strategies to break out of poverty are related intimately to the socially constructed definitions of poverty with which they live. Because we do not currently have the apparatus (of meaning and significance) to understand poverty as local people see it, we are unable to comprehend their strategies and pursuits. And because we are unable to perceive what they are doing of their own accord, we are unable to assist these endeavors very effectively. Our failure to understand their life-worlds and their strategies constitutes a large part of why we have been unsuccessful in helping people combat poverty more effectively.
Different meanings and different methods will need to be admitted if we are to come to grips better with critical micro-level factors that promote escape or propel descent. Growth may certainly be good for the poor, as it is for everyone else, but growth is certainly not the only thing, or even the most important thing, that might be good for the poor in some particular context of poverty.
Community-based investigations based on locally shared meanings of poverty can be very helpful for identifying other important factors that matter critically in specific contexts. People who have lived together over reasonably long periods of time tend to know who among them has progressed and who has declined. And they also tend to know broadly what events were associated with different households’ rise and decline: someone got a job in the city, while someone else succumbed to an expensive and ultimately untreatable illness; someone benefited from an irrigation scheme and now grows two crops instead of one, but at the same time another person lost her land to erosion or in a lawsuit. Eliciting this information carefully from community members – and complementing and verifying it with information gained independently from individual households – can go quite a long way toward re-constructing the sequence of events associated with mobility or stasis in each particular case.
It does not yield the types of numerical estimates that statisticians more commonly utilize for their analyses. But measuring poverty more precisely (against some common global standard) and dealing with poverty more effectively (in some particular local setting) are not necessarily always the same objective.