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HOME: STATE OF WORLD POPULATION 2002: Characterizing Poverty
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Characterizing Poverty

Overview
Many Dimensions of Poverty
A Web of Causes
Measuring Poverty

A Web of Causes

Recognition of the varied causes and outcomes of poverty and how they interact with each other influences the way we measure and monitor poverty and the plans we make to eliminate it. The new view of the development process-and who is left out of it-includes quality of governance and the rule of law, corruption and crime, cultural and historical factors. Only a few years ago such elements were considered to be quite outside the development mainstream and perhaps an intrusion in the affairs of sovereign nations.

In contrast, the Human Development Report 2000 (9) of the United Nations Development Programme (UNDP) is devoted largely to the human rights record of the world's nations. UNDP's Human Development Index regularly assesses countries' progress in education and health. The World Bank has made listening and responding to the "voices of the poor" a high corporate priority (10).

5 VOICES OF THE OLDER POOR IN SOUTH AFRICA AND INDIA

A recent study by UNFPA asked older poor women and men in South Africa and India, mostly in rural areas, about key issues affecting their lives. It found that many are concerned about extreme poverty: poor living conditions; inadequate health care and social protection; and inter-generational violence and abuse.

Almost 5 per cent of South Africa's population is 65 or older. These persons have lived through the indignity of apartheid and its legacy is still with them. Most are still caught in the grip of severe poverty and social exclusion.

Older South Africans identified their priority needs as: food security; clean water; adequate shelter; electricity; money and a pension; adequate health care facilities; identity documents such as birth certificates to claim their rights; and support in caring for a spouse. Their concerns with growing older centred on a fear of isolation, exclusion, abuse, illness, a sense of helplessness and the growing impact of HIV/AIDS.

India's older population is expected to grow from 77 million in 2000 to about 141 million by 2020. More than half of all older persons are on the verge of poverty, with many in poor health and living in unhygienic conditions.

Very few are covered by any kind of retirement scheme; the primary source of care and support is the family. However, economic development and widespread migration of young adults are disrupting traditional support for older people. Older women, especially those unmarried or widowed, are particularly disadvantaged.

Said Raji, 75, "I have lived alone since my husband's death seven years ago. My children migrated. They have never bothered to inquire about me. I have no income and hardly any contact with anyone. I will die like this. I have no life and am lonely and frail."

See Sources

WORKING THROUGH THE DEMOGRAPHIC TRANSITION The "population explosion" that began in the 1950s was the result of a sharp fall in death rates, made possible by innovations in health care and extensive use of imported medical technology on the part of developing countries (11). But in the poorest countries the corresponding changes that would help produce a decline in fertility-adaptation in human skills, capabilities and behaviour, improvements in physical infrastructure and technology-have been slow to follow. This mismatch has slowed economic and social progress. Imbalance between rapidly growing populations and resources to sustain them has stretched the limits of social organization, and put pressure on the institutions that serve the poor.

At the household level, high fertility increases the "dependency burden" represented by children, and reduces family well-being among the poor. Ironically, circumstances making for high fertility often coincide with expanding economic and social opportunities (12).

As countries go through the demographic transition and fertility falls, a temporary window of opportunity opens in which families with some resources can afford to educate their children, find good jobs and accumulate some assets. But the poor, the last group in society to experience fertility decline, are unable to take advantage of the opportunity (13). They not only have more children but also lack both information and the resources to make use of it. Their inability to respond to changed signals about the costs and benefits of children makes them worse off.

Reducing fertility helps to reduce poverty over the longer term. Demographic changes in Brazil in the last 50 years were equivalent to an additional 0.4 to 0.5 per cent in the annual growth of per capita income (14). During this period, the average growth rate in per capita income was close to 3.0 per cent per year. The estimated direct impact of the demographic transition on poverty was close to 15 per cent of the impact of economic growth.

THE 'ENABLING ENVIRONMENT' Technological progress and accumulation of human and physical capital have been the twin workhorses of modern economic growth. But they work most effectively in an environment that provides inducements for investing. This enabling environment includes the entire social framework: a representative political process untainted by corruption; respect for human rights; equitable laws and regulations, impartially enforced; and an array of public, civil, community and cultural institutions that reinforce each other in providing fair and equal social and economic opportunity to all citizens.

A successful example is micro-finance institutions, which use small loans to multiply the impact of community resources and initiatives. At the same time as offering economic support, they encourage community-based programmes in health, education and leadership training for women. This "bundling" of services based on partnerships with local communities has changed attitudes about empowering poor women while increasing their economic power (15).

Institutions are the social mechanisms that connect capacities and resources; the quality of institutions determines how productively or equitably the connection operates. Each element energizes-or holds back-the others. Basic literacy programmes, for example, increase individual capacity to acquire and use information about health, markets or community life; but they also improve the institutions that provide these services, putting them in a better position to connect newly literate people with useful information.

More responsive institutions likewise interact with capacity and resources: improvements in governance increase capacity by removing legal disabilities or enacting new powers; more equitable regulations can reduce the cost of conducting business or lower the barriers between poor people and resources. Civil society plays an important part in developing responsive institutions, for example, microcredit organizations that make resources available to the poorest groups, especially women, and at the same time offer help with literacy and support for family planning.

Many developing countries have made significant progress in improving the capacities of their populations overall: life expectancies (an indicator of health), nutrition, economic and educational attainment have all improved since 1960. But progress has been easier and faster in countries that have:

  • made available the information and means for women to space and time births, and avoid pregnancy if they wish to do so;
  • provided services for healthy pregnancies and safe deliveries;
  • increased the coverage and quality of education systems;
  • advanced gender equality and equity in other ways, such as protecting women's legal and customary rights;
  • adopted population policies based on human rights;
  • developed responsible and accountable systems of governance and popular participation.

6 GROUP-BASED CREDIT IN BANGLADESH
The Grameen Bank in Bangladesh provides small loans to poor families to start new businesses and, perhaps, a new life, but the families first need basic literacy, family planning, and enterprise management services. Providing all this to women who have been traditionally excluded from society is a challenge. Grameen therefore provides loans to groups rather than individuals. The group approach lowers the cost of providing services, while providing mutual support that allows women to interact with the market and community at large. See Sources

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