Overall Poverty

Development of the Concept

From at least the time of Adam Smith, scholars have differed over the definition of overall poverty, whether, as Smith argued, it is deprivation relative to the larger [Page 801]society or whether it is composed of an absolute and measurable standard based on extant human need. Recent research suggests that overall poverty is an objective condition of external deprivation but that its severity is conditioned in part by the larger culture.

Overall poverty often is described in absolute/ex-treme, subjective or moderate, or relative terms. Ab-solute/extreme poverty means having less than an objectively defined standard of existence for optimal health and development. Households in extreme poverty cannot meet basic needs for survival: they are chronically hungry, unable to access healthcare, lack safe drinking water and sanitation, do not have access to education, and often lack rudimentary shelter and basic clothing. Subjective or moderate poverty is not having enough to get along adequately, with basic needs just barely met or sometimes going unmet.

Relative poverty exists when household income and assets fall below a given proportion of average national income, and households have less than most others, where a range of available assets and opportunities exist. Overall poverty comprises the first two categories although it can have a somewhat different meaning in different societies and cultures.

In this context, overall poverty exists on a continuum of the experience of marginalization, from the most basic survival level of extreme poverty in which many highly adverse circumstances converge to a level of general or relative poverty in which more, but often insufficient, assets and opportunities exist for meeting basic human needs. Jeffrey Sachs has calculated that one billion people, one-sixth of humanity, are too hungry and destitute to get a foot on the first rung of the development ladder. They are the extreme poor fighting for survival each day, with cash earnings of only a few pennies a day.

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