View Point
May 26, 2006

Understanding Poverty

The measurement of poverty has been a challenge for analysts and policy makers for many decades. It remained a challenge because not many countries had poverty reduction high on their agendas. The subject is not one that was even discussed by the group of seven industrial countries at their summits until just about a decade ago. All this has changed in the past decade as the fight against global poverty is now treated as a matter of the highest priority.{{more}}

Current conceptual interpretations about the meaning of poverty extend beyond the traditional emphasis on material and income poverty, with special attention given to access education and health. Such basic aspects of poverty must still be a matter of primary concern, and they are. But it has now been realized that when poor people are consulted about their concerns, they often emphasize other dimensions of their plight, and this has led to some analytical rethinking and expansion of what poverty really means, and what it should seek to achieve. The new approaches accord equal attention to those other dimensions of poverty which have been emphasized by poor people themselves: first vulnerability and exposure to risk of negative shocks to their income and welfare, and second, voicelessness and powerlessness.

To policy makers in materially poor countries, these new interpretations of what it really means to be poor should resonate with them, since for decades they have spoken of their own unique vulnerability and powerlessness in the global economy within which they must function. Because small countries are so vulnerable to exogenous shocks and so powerless, they do in fact suffer unique problems and experience more poverty than had hitherto been widely acknowledged. Certainly, per capita incomes, literacy rates and infant mortality can no longer be regarded as the total poverty or human development measure. The OECS countries’ insistence on the establishment of a Development Fund as a condition to their entry into the CARICOM Single Market and Economy is a recognition of their own vulnerability and potential powerlessness even within a small states grouping.

The voice and powerlessness problem of small states derive from the difficulties they frequently experience, in light of their small governmental scale in operating effectively within multilateral decision-making systems. Individually, they simply do not have the numbers to attend all the meetings on matters that affect their welfare or to monitor the external developments that impact upon their rights. One clear response epitomized by CARICOM – the Caribbean Regional Negotiating Machinery – is for small countries to combine their forces to work closely together within the international arena. Poverty reduction as perceived by the disadvantaged themselves and as is more widely understood today, requires not only improvements in material income, but also increased security and empowerment or voice. This is true for the reduction of poverty of nations as it is for that of families or individuals. Small countries are uniquely vulnerable to external shocks and so, it follows, are the people who live in them. At the national level efforts are increasingly being made by countries to develop and implement poverty reduction strategies in a fully participatory manner that provide voice to the disadvantaged. It is through such improved processes that one can begin to address an important element in the current conceptualization of the poverty problem, even before one deals with the basics of material income poverty.

The world has come a long way in its understanding of poverty. Countries are actively exploring innovative ways to aid the poor such as investing in early childhood development, educating women and promoting micro finance. If children are being pulled out of school or babies do not receive the right nutrition because the mothers do not have access to it, they have a lower chance of advancing later in life and becoming productive participants in the economy. Taking charge of the poor makes good social and economic sense.