Moving out of poverty: Success from the bottom up

21 May 2009 12:00 - 13:30 GMT+00
Public event
Streamed live online

Speaker:

Deepa Narayan  - Senior Advisor in the Poverty Reduction and Economic Management Network, World Bank

Discussant:

Duncan Green - Head of Research, Oxfam GB

Caroline Harper - Programme Leader and Research Fellow, ODI

Chair:

Alison Evans - Director, ODI

Description

Nine years ago, the World Bank issued a three-volume, 23-country participatory study of the lives and livelihoods, aspirations and realities of poor people, entitled Voices of the Poor. The findings expanded definitions of poverty to include issues voice and empowerment, which in turn shaped approaches to institutional reform.

Voices of the Poor also demonstrated that poor people exhibit considerable strength, resilience and aspiration to succeed. In 2005, Moving out of Poverty, Success from the Bottom Up, a follow-up study led by Deepa Narayan in the World Bank's Poverty Reduction Group, was launched to better understand how it is that some poor people succeed in moving out of poverty, while others remain in or fall into poverty.  Combining a range of qualitative and quantitative methodologies, Moving out of Poverty provides a unique lens on the experiences and views of 60,000 people across 15 countries over a 10 year period.

At this meeting Deepa Narayan will present some of the findings from the study. Duncan Green and Caroline Harper will act as discussants.

The new World Bank book, Moving Out of Poverty: Success from the Bottom Up,is being launched in the context of global recession. The aggregate picture is that 60-90 million more people will be in poverty due to the financial crisis (and this compounds upon all those already in poverty as a result of the food and fuel price crises). But looking at these big aggregates often detracts from us really understanding personal experiences. This book is not about aggregates. It presents the struggles and strategies, determination and agency of those moving in and out of poverty, and really helps us to understand what the dynamics of poverty look, feel and smell like.

Deepa Narayan (Senior Advisor in the Poverty Reduction and Economic Management Network, World Bank)

There are three overarching questions behind this study (which started in 2004)

1)      How and why do some people / households move into and out of poverty and why others in similar situations don’t?

2)      How does local democracy effect movement into and out of poverty?

3)      What is the role of social dimensions, such as identity and networks?

In terms of the study’s methodology (which Deepa pointed out was relatively unconventional as the team had no starting hypotheses), it draws upon 22 case studies in 15 countries; 10 data collection techniques (including qualitative and quantitative measurements); it employed retrospective recall; there were circa 100-120 households surveyed per community (unlike conventional household surveys where there might only be 10); and although the surveys were standardized to some extent the project employed local teams / used local languages for context specificity.

Deepa then moved onto to some of the core themes or substance areas:

-          Cultures of poverty

A key finding of this study is that is integral to examine cultures of poverty and the moral/cultural background to poverty alleviation i.e. question social expectations of the deserving or undeserving poor and/or viewing those in poverty as there due to a lack of motivation. The conclusions from this book highlight the erroneous judgement in the assumption underlying free markets i.e. that there is equitable access, and therefore that those not capitalising upon them are not doing so of their own volition. Quite to the contrary, this study highlights the lack of evidence for a culture of poverty and concludes that generally people work hard. But one of key factors that did emerge was the absence of financial instruments to help poor people. As such the conclusion is the necessity for a change in institutional and social mindsets; as demonstrated by the interviews poor people were not falling into poverty de to gambling/alcoholism/or apathy but due to health shocks, or the lack of financial support. Following on from this aspiration was also a surveyed factor and it was ascertained that although aspirations do considerably increase following moderate successes, it is not the case that poor people do not want to be entrepreneurial and do not take risks.

-          Poverty Measures

This study employed a ladder of life method, when asking people to quantify their poverty and how they have moved in and out of poverty. The big message from this evaluation was that researchers and policy writers are too focused upon averages, but these mislead policy responses. As such there needs to be more research upon the dynamics beneath these averages. Doing this demonstrated a much higher incidence of ‘churning’ or those moving in and out of poverty than had been previously expected. As such there should be more of a focus upon vulnerability and the importance of building up of assets.

-          Economic opportunities

Where you live matters enormously. 78% of predictions of those likely to fall into poverty, from economic models, were correct- based on economic opportunity. Markets are rigged and poor people’s lack of bargaining power means they are regularly cheated. According to those interviewed in Tanzania ‘rich men control the prices.’ Other personal quotations cited by Deepa related to poor people wanting to move to free markets but lacking access; ‘There is a ditch in front of us and a hole behind us.’

-          ­Local Democracy

This study has demonstrated the importance of looking below political titles to the realities of local government engagement i.e. in India there is a liberal democracy, whilst in Morocco some might call it an illiberal democracy and yet in Morocco the local government appeared to be much more responsive to people’s needs. As such it is important to look within countries and no just compare across them. Another important conclusion relating to political freedom is that many people emphasised their want of freedom (which was defined as, for example, the ability and freedom to protest).

-          Inequality

This study found inequality to be pervasive everywhere. According to one respondent ‘inequality is carrying a sack of sugar on your head all year and never being able to taste it.’

-          Collective Action

Perhaps the most contentious finding of this report; Deepa pointed out that when most people are in crisis they turn to their family (85% of those surveyed) and only a tiny percentage (c.1.3% to the NGO sector). Also controversial was the suggestion that a propensity for collective action may actually have negative associations as most use it as a survival strategy (i.e. sharing meals). As such it is a sticking plaster and seldom develops into coordinated action unless over a long duration.

Alison Evans:

It seems that this study has communicated two powerful conclusions; the power of individual action and challenges to the development sectors general conception of the benefits of collective action

Nora Dudwick (The World Bank)

Speaking specifically about the Moroccan case study, Nora pointed out that in communities dependent on agriculture, no one was immune from falling into poverty.

Other key points were that although providing public services and infrastructure might not necessarily boost income, it could definitely be correlated to well-being and higher aspiration/motivation to work. Current deficits are healthcare for women and schooling.

Conclusions from Morrocco were that those moving out of poverty were those with a stable source of income (salary, pension, remittances) and those with assets. The least mobile were those dependent on agriculture and particularly rain-fed agriculture. Labour migration also proved key to household mobility and community prosperity.

The implications are that there is a necessity to reduce the red tape for entrepreneurship (at the local level); that we should broaden rural credit access; increase support to producers cooperatives (although mainly dominated by the less poor rather than the chronically poor); that we should provide incentives for local investment; implement social safety nets; and empower youth.

Discussants:

Caroline Harper - Programme Leader and Research Fellow, ODI

A compelling read and great to see a World Bank publication with a good emphasis on agency and power relations (and to some extent a social relations lens).

Caroline had two conclusions relating to social relations and the books correlation with the Chronic Poverty Report;

1)      Social Relations

First there is an inherent problem in the methodology of this book. The way in which poverty is understood, through self-definition, drives the conclusions. As such there is no sense of wider reference i.e. the book makes little of discrimination and there is no in depth challenge of social structures and hierarchy. There is also interestingly no pie chart (which presents reasons for descent into poverty) for discrimination i.e. I can’t go to market because of my husband / caste/ religion. Defining poverty in a structural way is always limited but a useful heuristic tool might be to think about who we are and where we live i.e. step out of social norms. Ultimately the book suffers from its own detail. Structural relations comes up again and again and there is tantalizing mention to power dynamics but the conclusions don’t really engage with it and there is no sense of the authors challenging why and how.

2)      Correlation with the Chronic Poverty Report

This book has very close parallels to the Second Chronic Poverty Report. Both highlight social relations and poverty traps that relate to ones potential to move into and out of poverty. The difference between the two pieces of work is however that CPR2’s focus on discrimination, social justice and its overriding social inequality-focused conclusions are reversed in Moving Out of Poverty, where the final conclusion is the importance of economic opportunities/ democracy/markets; which bellies much of its detailed content.  Having been a co-author Caroline empathized with the difficulties of writing conclusions on social inequalities but highlighted that history does tell us that social inequalities do change and therefore that addressing large scale ideological shifts is very important.

Duncan Green - Head of Research, Oxfam GB

Firstly Duncan praised the book- which NGOs will be mining for quotes for years to come. Second he applauded the focus on individual agency (which he thought related to Richard Layhart’s work); particularly challenging was the emphasis, from a World Bank publication, on power to/power over and so forth. He also praised the conclusions on collective action. Finally he also pointed out that the book (for the most part) avoids excessive romanticism about the poor- however it is still a little starry eyed.

However there were a number of tensions.

-          First the conclusions do not do the book justice. Need a follow on book relating to the so-what? What are the implications for action?

-          Second there was a tension between the qualitative and quantitative analysis. This is predominantly a stylistic issue but they seem to sit incongruously.

-          Religion is almost entirely absent from the study which is a considerable blind spot.

-          In the chapter on markets the multidimensional conceptualization of poverty seems to all but fall away and there is little to no gender analysis.

-          Migration; again this is largely missing, bar in Morrocco, but surely this is a clear path out of poverty for many families across the world?

Questions:

  • Kate Bird (ODI): You highlight agency but I ask, from what is it derived? You seem to separate agency from economics but in my work agency seems to be very closely tied to assets. Another question relates to risk; this work seems to link risk aversion to the narratives of Oscar Lewis but again in my research these two seem bimodal. The poor do take risks, but these are just very different types of risk.
  • Ian Buges (Plan International / formerly DFID): What about the population factor? Have the communities you surveyed not considerably changed over time? Expanding with population growth- has this acerbated poverty?
  • Frank Amuti: Can the panel speculate about how one might move out of poverty?
  • Matt Davis: 0.3% was cited as the % of the population who turn to NGOs fr assistance in times of economic strain. Is this a spatial issue of your dataset or are the NGOs failing?
  • Tom Sanderson: What about financial literacy as a key to moving out of poverty?
  • Tim Merchant (Ex WB): Your methodology seems to suffer from the lack of a discussion about your sampling- surely this undermines your data and statistics?
  • Stuart Hadley: Your analysis of movement in and out of poverty is over a very broad time frame but what about intra-year movement / seasonality?
  • The study seems to talk a lot about how poor people are conceptualized, but did you delve deeper and examine how they felt about public discourse and about their avenues for communication?

Responses:

Deepa conceded that at the conclusions the authors ‘ran out of steam’; but did try to conclude at the end of every section and didn’t want to repeat themselves. She also emphasized that everything at the end of the day is very context specific so an attempt was made not to over-generalize. She also conceded that this study considerably suffers from a lack of gender analysis, but more detailed analysis was constrained by lack of time and resources.

Re. the lack of consideration of structural issues in the conclusions- how you ask a question determines an answer. As such the study used 10 different interview techniques. As social inequalities came out throughout but in different ways, it was decided to address this theme throughout rather than in one section- but perhaps this is not explicit enough. Regarding the absence of religion (and migration) the sample was local and random, but the authors were also surprised that this didn’t come out more- particularly given religion was such a strong theme in Voices of the Poor (this point was seconded by Ruth).

Re. Kate Bird’s point and risk aversion: The authors don’t mean to say that the poor are risk averse- it is apparent that they do take risks, it is just that the risks are different. And regarding the question of agency and assets; there are two types of agency- inputs and moving out of poverty and the determinants of agency (and here assets are indeed very important). Ruth subsequently pointed out that psychological assets are also very important (such as education and income) as these have a huge impact on confidence.

Deepa’s key policy recommendation was to necessity to focus on how to support poor people’s entrepreneurship, in a sustainable manner and to enable equal bargaining power. For Ruth the central policy recommendation was the necessity to focus on vulnerability and social protection; particularly public health care, in addition to markets and opportunities.