Poverty and Poverty Alleviation

Poverty

Poverty refers to a core set of basic human deprivations, and poverty alleviation refers to efforts by individuals and institutions to reduce these deprivations. Depending on the measure, several billion people, perhaps more than half of humanity, are poor by an absolute standard of deprivation. Even within very wealthy countries, severe poverty persists in both relative and absolute terms. Although poverty exists in every country in the world, the content, experience, and likelihood of deprivation is widely divergent in different contexts.

Conception and Measurement

How one conceives of and measures poverty is a very important and highly contested topic in global studies. Initially, countries were categorized as either poor or nonpoor based on per capita gross domestic product (GDP). This measure, which takes the country as a unit of analysis, is clearly flawed as it fails to take into account the distribution of deprivation within a country. Beginning in 1990, the World Bank established the International Poverty Line, which, after several revisions, currently stands at US$1.25 PPP 2005—that is, it is supposed to be the value in local currency that has the same purchasing power as US$1.25 had in the United States in 2005.

In the domestic context, most national poverty lines are also set in monetary terms. But the rationale for these lines can vary. In some cases, the monetary poverty line is set by the cost of acquiring a certain number of calories, whereas in others by the cost of acquiring a more diverse set of basic goods. Domestic poverty lines can be either absolute (compared with an independent standard) or relative (compared with the prevailing average income in a given society).

The monetary approach to poverty has obvious limitations. It fails to take into account one's ability to convert income into achievements, ignores the different needs of different individuals, and excludes key dimensions of human life such as education and health care that are clearly relevant to avoiding poverty. From a measurement perspective, the International Poverty Line critically depends on unreliable comparisons of purchasing power over time and across context that have little relevance to the economic lives of poor people. Researchers are currently seeking a more meaningful, comparable, and justifiable measure of global poverty.

The basic-needs approach to poverty identifies people as poor if they are deprived of or lack certain basic needs, usually food, clothing, shelter, water and sanitation, education, and health care, but occasionally it includes nonmaterial needs like public participation or secure employment. The basic-needs approach is intuitively plausible, as all human beings do have certain needs that must be met for basic functioning as human beings. It is an improvement on the income-based approach in that it recognizes the multidimensional nature of poverty. However, the basic-needs approach fails to take into account the agency of individuals, and the degree to which different social locations and personal heterogeneities can affect one's ability to convert resources into functionings or achievements.

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