Poverty and Inequality in Middle Income Countries: Policy Achievements, Political Obstacles
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Poverty and Inequality in Middle Income Countries: Policy Achievements, Political Obstacles
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Overview
Providing poverty researchers and practitioners with valuable new tools to address new forms of poverty in the right way, Poverty and Inequality in Middle Income Countries shows how a radical switch from aid to redistribution-based social policies is needed to combat new forms of global poverty.
Product Details
| ISBN-13: | 9781783605606 |
|---|---|
| Publisher: | Bloomsbury Publishing |
| Publication date: | 04/15/2016 |
| Series: | International Studies in Poverty Research |
| Sold by: | Barnes & Noble |
| Format: | eBook |
| Pages: | 264 |
| File size: | 2 MB |
About the Author
Julian May is director of the DST-NRF Centre of Excellence in Food Security at the University of the Western Cape. Professor May works on poverty reduction, including land reform, social grants, information technology and urban agriculture in southern and East Africa. He formerly held the South African Research Chair in Applied Poverty Impact Assessment.
Marianne S. Ulriksen is senior research fellow at the Centre for Social Development in Africa (CSDA), University of Johannesburg, South Africa. Marianne's research areas include comparative politics, the political economy of welfare policy development, social protection, social justice, poverty and inequality, mineral wealth and resource mobilization, and state–citizens relations. Her publications primarily focus on southern and eastern Africa, where she has lived and worked since 2000.
Gemma Wright is research director of the Southern African Social Policy Research Institute, and Southern African Social Policy Research Insights. She is professor extraordinarius at the University of South Africa and research associate at the Institute of Social and Economic Research at Rhodes University. Her areas of interest include social security policy and the definition and measurement of poverty.
Einar Braathen is senior researcher in international studies at the Norwegian Institute for Urban and Regional Research (NIBR). A political scientist, he has specialized in governance and policy analysis in the global South, particularly the linkages between multi-level governance (central-local relations, municipality-community relations) and policy delivery (poverty reduction, service delivery, climate change adaptation). He worked as the coordinator of the CROP programme on The Role of the State in Poverty reduction, 1997-2000. For the last 10 years he has mainly worked on two BRICS countries, South Africa and Brazil, and he has lived in Rio de Janeiro for longer periods. He was the project leader of Cities against poverty: Brazilian experiences (2010-13) funded by the Research Council of Norway and the leader of the work package 'Politics and policies to address urban inequality' in the EU/FP/ funded project Urban Chances - City Growth and the Sustainability Challenge (2010-2014). He is the editor of the website www.nibrinternational.no/Brazilian_Urban_Politics.
Julian May is the Director of the Institute for Social Development and Chairperson of the Community Law Centre at the University of the Western Cape and the NRF funded South African Research Chair in Applied Poverty Assessment. He is a Research Associate at the Brooks World Poverty Institute, the International Food Policy Research Institute, the Department of Social Policy, Oxford University and the South African Labour and Development Research Unit at the University of Cape Town.
Gemma C. Wright is a Senior Research Fellow at the Oxford Institute of Social Policy in the Department of Social Policy and Intervention at the University of Oxford and Deputy Director of the Centre for the Analysis of South African Social Policy. She is a Research Associate at the Institute of Social and Economic Research at Rhodes University (RSA) and Visiting Research Fellow at the Centre for International Education, University of Sussex. Her areas of interest include the definition and measurement of poverty, child poverty, small area level analysis of deprivation, and social security policy including tax and benefit microsimulation.
Read an Excerpt
Poverty and Inequality in Middle Income Countries
Policy Achievements, Political Obstacles
By Einar Braathen, Julian May, Marianne S. Ulriksen, Gemma Wright
Zed Books Ltd
Copyright © 2016 CROPAll rights reserved.
ISBN: 978-1-78360-560-6
CHAPTER 1
POLICY-RELEVANT MEASUREMENT OF POVERTY IN LOW, MIDDLE AND HIGH INCOME COUNTRIES
David Gordon and Shailen Nandy
Introduction
The governments of all countries in the world have repeatedly made commitments to eradicate poverty during the twenty-first century. For example, at the 1995 World Social Summit, the leaders of 117 countries agreed on The Copenhagen Declaration and Programme of Action, which emphasized that the eradication of poverty 'was an ethical, social, political and economic imperative of humankind' (UN 1995). Countries subsequently committed themselves to implementing both national and international policies to substantially reduce overall poverty and eradicate absolute poverty during the twenty-first century (UN DESA 2005).
In September 2000, the governments of 189 countries adopted the United Nations Millennium Declaration resolving to 'spare no effort to free our fellow men, women and children from the abject and dehumanizing conditions of extreme poverty' (UN 2000). In December 2007, the United Nations General Assembly proclaimed the Second United Nations Decade for the Eradication of Poverty (2008–2017) and reiterated 'that eradicating poverty is the greatest global challenge facing the world today' (UN 2008).
Thus, poverty reduction is a key concern across countries. An essential task in achieving this goal is first to understand the extent of poverty – that is, to define and measure it. Accurate and precise measurement is needed in all countries (Low, Middle and High Income) to determine whether or not anti-poverty policies are effectively and efficiently eradicating poverty and deprivation. It will be very difficult, impossible even, to determine whether poverty has been eradicated globally if different definitions and measures of poverty are used in different counties. This chapter discusses some potential methods for the robust and rigorous measurement of poverty in all countries irrespective of their level of economic development.
It is not possible to produce valid and reliable measures of anything (for example, speed, mass, evolution or poverty) without a theory and a definition. The next section provides a conceptual framework for measuring poverty in all countries, irrespective of their level of development. This is followed by examples of how similar methods can be used to meaningfully assess poverty in Low, Middle and High Income Countries.
Conceptual framework It is still fashionable among some economists to repeat the old claim that: 'For deciding who is poor, prayers are more relevant than calculation, because poverty, like beauty, lies in the eye of the beholder. [...] Poverty is a value judgement; it is not something that one can verify or demonstrate' (Orshansky 1969: 37).
Orshansky defended the choices she made when developing the US poverty line by arguing, somewhat illogically, that 'if it is not possible to state unequivocally "how much is enough", it should be possible to assert with confidence how much, on average, is too little' (Orshansky 1965: 17). However, poverty is a social fact and all cultures have a concept of poverty (Gordon and Spicker 1999), which is a difficult finding to explain if poverty is solely in the 'eye of the beholder'. In Low Income Countries (LICs), poverty is often a murderous social fact which results in the deaths of millions of children (Black et al. 2003, 2010). As the World Health Organization points out, 'The world's biggest killer and greatest cause of ill health and suffering across the globe is listed almost at the end of the International Classification of Diseases. It is given code Z59.5 – extreme poverty' (WHO 1995: 1).
Poverty does not kill children as frequently in Middle and High Income Countries, although, as mentioned in the Introduction, Middle Income Countries (MICs) still harbour a large number of extremely poor people. Even in High Income Countries (HICs) with functioning social security systems and welfare states, poverty still results in premature death.
Table 1.1 illustrates how life expectancy, even in an HIC like the UK, can vary to the extent that some people are worse off than the average person in some MICs. The table shows that life expectancy at birth for men in the Carlton area of Glasgow (in the UK) is only 54 years, which is lower than the average life expectancy for men in MICs like India, the Philippines and Mexico. However, only a few kilometres walk north-east of Carlton, in the wealthier area of Lenzie, life expectancy for men is 82 years – higher than the average male life expectancy in any country in the world. In a short walk across a city in one of the richest countries in the world, one travels from one area to another where boys have a twenty-eight-year difference in life expectancy. The underlying cause of this difference is poverty, not differences in health-related behaviours (Galobardes et al. 2004, 2008; Davey Smith 2007; Commission on Social Determinants of Health 2008; Spencer 2008; Thomas et al. 2010). These deaths are cruel and measurable social facts; they are not in the 'eye of the beholder' and neither is their underlying cause – poverty.
Fortunately, since the work of Orshansky in the 1960s, significant theoretical advances have been made in poverty research. In particular, the research of Peter Townsend resulted in a paradigm shift in poverty measurement methodology (Walker et al. 2010). The first paragraph in his seminal work Poverty in the United Kingdom is arguably one of the most important ever written about poverty. It is now so well known that many researchers and students of social policy can recite it from memory:
Poverty can be defined objectively and applied consistently only in terms of the concept of relative deprivation [...] The term is understood objectively rather than subjectively. Individuals, families and groups in the population can be said to be in poverty when they lack the resources to obtain the types of diet, participate in the activities and have the living conditions and amenities which are customary, or at least widely encouraged or approved, in the society to which they belong. (Townsend 1979: 31)
Townsend argued that absolute poverty did not exist as a meaningful concept distinct from relative poverty. Poverty in all countries and cultures was the same phenomenon and what was termed 'absolute' poverty was in reality just more severe/extreme/deeper poverty. The difference between being 'relatively' poor and 'absolutely' poor was simply the difference between the 'poor' and the 'poorest'.
Townsend's relative deprivation approach is a sociological theory, which emphasizes the importance of both social participation and the dynamic nature of poverty, i.e.:
poverty is a dynamic, not a static concept ... Our general theory, then, should be that individuals and families whose resources over time fall seriously short of the resources commanded by the average individual or family in the community in which they live ... are in poverty. (Townsend 1962: 219)
According to Townsend, poverty can be defined as having an 'insufficient command of resources over time' and the consequence of a lack of 'resources' is that a 'poor' person/household will eventually become deprived. Thus, poverty is the lack of resources and deprivation is the consequence/outcome of poverty.
Townsend (1979) defined resources as cash income (e.g. wages, self-employment profits, etc.), capital assets (e.g. imputed rent, stocks and shares, etc.), value of employment benefits (e.g. subsidized meals, travel, computers, etc.), value of public services (free health, education, housing subsidies, etc.) and private income in-kind (e.g. home production of food, etc.). He showed that, in the United Kingdom, cash income as conventionally measured represented less than 60 per cent of household resources and was therefore not a highly reliable measure of command of resources over time (ibid.).
Even in 'rich' countries, with monetized economies and high-quality survey data, the use of income as a measure of resources is problematic. In LICs/MICs, where there is a considerable amount of home production of food and some barter of goods and services, conventional measures of income from cross-sectional (i.e. one point in time) social surveys are likely to be inadequate proxy measures of 'command over resources'. Expenditure data from social surveys is often of lower quality than income data (owing to short expenditure diary-keeping periods and non-response among some household members) and attempts to measure 'consumption' are even less reliable. Also, there is no agreed international definition or method for measuring 'consumption', and even the seemingly simple task of converting food expenditure data into measures of food consumption and dietary adequacy is fraught with difficulty and requires literally thousands of 'heroic' assumptions (Deeming 2010, 2011).
Townsend also argued that deprivation, like poverty, is a relative concept:
Deprivation may be defined as a state of observable and demonstrable disadvantage relative to the local community or the wider society or nation to which an individual, family or group belongs. The idea has come to be applied to conditions (that is, physical, emotional or social states or circumstances) rather than resources and to specific and not only general circumstances, and therefore can be distinguished from the concept of poverty. (Townsend 1987: 5)
The two concepts, of poverty and deprivation, are therefore tightly linked. The concept of deprivation covers the various conditions, independent of income, experienced by people who are poor, while the concept of poverty refers to the lack of income and other resources which makes those conditions inescapable or at least highly likely (ibid.).
In order to measure poverty and deprivation consistently and comparatively across all countries and cultures, it is necessary to measure exclusion from the normal social activities and lack of common possessions in each society resulting from inadequate command of sufficient resources over time. The accuracy and policy relevance of poverty measures can be greatly enhanced if the views of the population (and particularly the 'poor') can be incorporated into the measure of poverty. There are several methods for achieving this, such as the use of focus group methods, incorporating nationally or internationally agreed standards into the measure (such as minimum standards of education, water quality, housing quality, etc. found in the constitutions of some countries – such as South Africa) and/or using the 'consensual' or 'perceived deprivation' approach to measuring poverty by investigating the public's perceptions of minimum needs. The 1983 Breadline Britain study pioneered this method:
This study tackles the question 'how poor is too poor?' by identifying the minimum acceptable way of life for Britain in the 1980s. Those who have no choice but to fall below this minimum level can be said to be 'in poverty'. This concept is developed in terms of those who have an enforced lack of socially perceived necessities. This means that the 'necessities' of life are identified by public opinion and not by, on the one hand, the views of experts or, on the other hand, the norms of behaviour per se. (Mack and Lansley 1985)
Mack and Lansley defined 'necessities' as possessions and 'activities' as items that every family (or person) should be able to afford and that nobody should have to live without. An item regarded as necessary by at least 50 per cent of respondents was seen as a 'socially perceived necessity'. Since the 1980s, this methodology has been successfully used to measure poverty in Europe and across the world in Low, Middle and High Income Countries – for example, Bangladesh (Mahbub Uddin Ahmed 2007), Vietnam (Davies and Smith 1998), Tanzania (Kaijage and Tibaijuka 1996), Zimbabwe (Mtapuri 2011) and South Africa (Noble et al. 2004; Wright 2008; Barnes 2009a, 2009b; Barnes and Wright 2012).
The consensual method for measuring poverty involves three steps. First, what the public perceives as social necessities must be established; secondly, those who suffer an enforced lack of the socially perceived necessities should be identified; and, thirdly, the levels of household income at which people run a greater risk of not being able to afford the socially defined necessities in a given national context should be determined, so identifying the poverty line or band (Gordon and Pantazis 1997; Gordon 2006).
This approach contrasts with that of many other poverty measures, including the most commonly used one, the World Bank's International Poverty Line (IPL), set roughly at a 'dollar a day', adjusted for purchasing power parity (World Bank 1990; Ravallion et al. 1991; World Bank 2000; Ravallion et al. 2008). It is the indicator being used to reflect progress towards Target 1.A of the first Millennium Development Goal (MDG), to 'halve, between 1990 and 2015, the proportion of people whose income is less than one dollar a day', and garners far more attention than the two other targets of MDG1, namely 'Target 1.B: Achieve full and productive employment and decent work for all, including women and young people' and 'Target 1.C: Halve, between 1990 and 2015, the proportion of people who suffer from hunger'.
Sustained criticism of the '$1/day' measure has highlighted serious problems of validity and reliability. However, a number of reports have been published in recent years using this indicator, which purport to show that the world is on track to meet MDG1 and that this is true even for sub-Saharan Africa.
As also discussed in the Introduction, the $1/day measure has long been contested on theoretical, methodological and even moral grounds (Townsend 1993; Townsend and Gordon 2002; Vandemoortele 2002; Pogge 2004, 2005; Townsend et al. 2006), not least because it does not fully reflect the Bank's own definition of poverty, set out in 1990, as 'the inability to attain a minimal standard of living' (World Bank 1990: 26). Concerns about methodological shortcomings are harder to ignore. Pogge and Reddy have made detailed assessments of the World Bank's poverty measure (Reddy and Pogge 2002; Pogge 2010), noting recently that the Bank's revised 'updated' poverty line ($1.25 in 2005 PPP) resulted in significant revisions to its own estimates, by nearly 50 per cent (Chen and Ravallion 2008), while still remaining at too low a level to cover the cost of purchasing basic necessities (Reddy and Pogge 2008). Reliance on purchasing power parities (PPPs), which require adjustments over time (and place), also renders the Bank's measure problematic, and a key reason for the revision of the Bank's global poverty estimates was that the costs of living in many countries had been underestimated, and thus the previous estimates had significantly underestimated the extent of world poverty.
Revisions to the international poverty line have been made possible by the greater availability of high-quality household survey data from more countries and by more accurate estimates of cost of living standards around the world. The 2008 update made estimates of the proportion and number of people living below a range of different poverty lines (i.e. $1/day, $1.25/day, $1.45/day, $2/day, $2.50/day). While there were significant reductions in the proportion and number of people living under the lower thresholds, there were increases when estimates used the $2/day and $2.5/day thresholds. The selection of lower thresholds downplays the true extent of extreme poverty and the conditions it entails and also facilitates claims of progress towards the first MDG. Chen and Ravallion's update noted that, with the IPL set at $1/day or $1.25, the world was well ahead (185 and131 per cent, respectively) of schedule to meet the first MDG by 2015. Much less impressive achievement was noted if slightly higher IPLs were used, of $2/day and $2.50/day. In these instances, the world was 32 per cent behind schedule or regressing by 12 per cent, respectively (Pogge 2008). Pogge also noted that, if the Bank's international poverty line were applied to the USA, a person with a daily income of $1.37 (~$500/year) would be rendered as non-poor (Pogge 2010) – evidence (if it was needed) of the measure's lack of face-validity in MICs and HICs.
(Continues...)
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Table of Contents
Introduction: Poverty and Politics in Middle Income Countries - Einar Braathen, Julian May, Marianne S. Ulriksen and Gemma Wright1. Policy-Relevant Measurement of Poverty in Low, Middle and High Income Countries - David Gordon and Shailen Nandy
2. Poverty, Inequality, Racism and Human Rights in Mexico and Latin America - Camilo Pérez-Bustillo
3. South Africa, the OECD and BRICS - Tor Halvorsen
4. Universalizing Health Coverage in Emerging Economies - Amrit Kaur Virk
5. The Politics of Inequality in Botswana and South Africa - Marianne S. Ulriksen
6. Democratization, Disempowerment and Poverty in Nigeria - Samuel Ojo Oloruntoba
7. Urban Poverty and Inequality in Rio de Janeiro, Cape Town and Durban - Einar Braathen, David Jordhus-Lier, Berit Aasen and Catherine Sutherland
8. Adults Who Live on the Streets of Buenos Aires - Martín Boy
9. Grassroots Politics and Social Movement Mobilizations for Development in Brazil - Abdulrazak Karriem
10. Land-Alienation-Infused Poverty in India - Sony Pellissery
11. The Politics of Hunger Deaths in Odisha (India) - Rajakishor Mahana