Chronic Poverty Report 2008-09: Escaping Poverty Traps

Abstract

This report argues that tackling chronic poverty is the global priority for our generation. There are robust ethical grounds for arguing that chronically poor people merit the greatest international, national and personal attention and effort. Tackling chronic poverty is vital if our world is to achieve an acceptable level of justice and fairness. There are also strong pragmatic reasons for doing so. Addressing chronic poverty sooner rather than later will achieve much greater results at a dramatically lower cost. More broadly, reducing chronic poverty provides global public benefits, in terms of political and economic stability and public health. The chronically poor are not a distinct group. Most of them are 'working poor', with a minority unable to engage in labour markets. They include people who are discriminated against; socially marginalised people; members of ethnic, religious, indigenous, nomadic and caste groups; migrants and bonded labourers; refugees and internal displacees; disabled people; those with ill health; and the young and old. In many contexts, poor women and girls are the most likely to experience lifelong poverty. Despite this heterogeneity, we can identify five main traps that underpin chronic poverty.

  • Insecurity - the chronically poor are frequently those who live in insecure environments, and who have few assets or entitlements to cope with shocks and stresses. Their coping strategies often involve trading long-term goals to improve their lives (e.g. accumulating assets or educating children) for short-term survival.
  • Limited citizenship - chronically poor people have no meaningful political voice and lack effective political representation. The societies they live in and the governments that exercise authority over them do not recognise their most basic needs and rights.
  • Spatial disadvantage - remoteness, certain types of natural resource base, political exclusion and weak economic integration can all contribute to the creation of intra-country spatial poverty traps. Spatial disadvantage also occurs across entire nations (which we term Chronically Deprived Countries). Many urban locations, despite proximity to possible advantage, are highly disadvantaged, with poor or non-existent public services, high levels of violence and desperate living conditions.
  • Social discrimination - chronically poor people often have social relations - of power, patronage and competition - that can trap them in exploitative relationships or deny them access to public and private goods and services. These are based on class and caste systems, gender, religious and ethnic identity, age and other factors.
  • Poor work opportunities - where there is limited economic growth, or where growth is concentrated in enclaves, work opportunities are very limited and people can be exploited. Such work allows day-to-day survival but does not permit asset accumulation and children's education.

The report identifies five key policy responses to these five traps. These policies do not map neatly (on a one-for-one basis) against the chronic poverty traps. Rather, they create an integrated policy set that can attack the multiple and overlapping causes of chronic poverty. Priority goes to two policy areas - social protection (Chapter 3) and public services for the hard to reach (Chapter 5) - that can spearhead the assault on chronic poverty. Alongside these are anti-discrimination and gender empowerment (Chapter 5), building individual and collective assets (Chapters 3, 4 and 6) and strategic urbanisation and migration (Chapters 4 and 5). Working together, these policies reduce chronic poverty directly and create and maintain a just social compact that will underpin long-term efforts to eradicate chronic poverty (Chapter 6). Such social compacts ensure a distribution of public goods and services that contributes to justice and fairness. In a global report such as this we are striving to produce policy recommendations that can be applied across many countries. But, as the report shows, policies to reduce and eradicate chronic poverty need to be customised to specific national contexts. While many of the case studies included refer to specific countries, we utilise a simple typology to differentiate the main types of country context. Based on a cluster analysis of 131 countries, we identify four distinct country clusters (Chapter 1/Annex J):

  • Chronically Deprived Countries (CDCs)
  • Partially Chronically Deprived Countries (PCDCs)
  • Partial Consistent Improvers (PCIs)
  • Consistent Improvers (CIs)

While the patterns are complex, it is evident that the inroads on chronic poverty that have started and/or are well advanced in East Asia, South East Asia, the Middle East, North Africa and parts of South and Central America have not yet been matched by progress in sub-Saharan Africa and South Asia.

Citation

Chronic Poverty Research Centre (CPRC). Chronic Poverty Report 2008-09: Escaping Poverty Traps. Chronic Poverty Research Centre, London, UK (2008) 164 pp. + Annexes F-L (53 pp.)

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