The Chronic Poverty Report 2014-2015: - Chronic Poverty Advisory

186 Pages·2014·12.27 MB·English

The Chronic
Poverty Report
2014-2015:
The road to zero
extreme poverty
CPAN is a network of researchers, policy makers and
practitioners across 15 developing countries (Bangladesh,
Benin, Burkina Faso, Cambodia, Ghana, India, Kenya,
Nepal, Niger, Pakistan, Philippines, Senegal, South Africa,
Tanzania, Uganda, Viet Nam) focused on tackling chronic
poverty and getting to zero extreme poverty and deprivation.
It is looking to expand this network to the 30 countries with
the largest numbers of poor people, and it is planning to
launch a consultancy service to help countries ‘get to zero’.
It has a ‘hub’, which is currently hosted by the Overseas
Development Institute in London.
Authors
Andrew Shepherd, Lucy Scott, Chiara Mariotti,
Flora Kessy, Raghav Gaiha, Lucia da Corta,
Katharina Hanifnia, Nidhi Kaicker, Amanda
Lenhardt, Charles Lwanga-Ntale, Binayak Sen,
Bandita Sijapati, Tim Strawson, Ganesh Thapa,
Helen Underhill, Leni Wild
Readers are encouraged to reproduce material from
the Chronic Poverty Report 2014–2015 for their
own publications, as long as they are not being sold
commercially. As copyright holder, ODI requests due
acknowledgement and a copy of the publication. For
online use, we ask readers to link to the original resource
on the ODI website.
The views presented in this publication are those of the
author(s) and do not necessarily represent the views of
ODI or its partners.
© Overseas Development Institute 2014. This work
is licensed under a Creative Commons Attribution-
NonCommercial Licence (CC BY-NC 3.0).
Front cover: Beneficiaries of Bolsa Família, Brazil. Photo:
Ana Nascimento/MDS
Preface and Acknowledgements
Preface
With the debate on the post-2015 development framework in full swing, the third international Chronic Poverty Report addresses
one key question: what needs to be done to get to (or close to) zero extreme poverty by 2030 – the new goal for global poverty
reduction?
The report is the first produced by the Chronic Poverty Advisory Network (CPAN), the successor to the Chronic Poverty
Research Centre (CPRC), which produced the first two Chronic Poverty Reports. Drawing on ten years of research by the CPRC
and others, and on recent policy guides from CPAN, it presents new analysis of what it takes to sustain escapes from poverty;
of countries that have succeeded in tackling chronic poverty; and new projections of poverty in 2030.
It presents a tripartite challenge to the world: to get close to zero extreme poverty countries need to tackle chronic
poverty, stop impoverishment and ensure that those who manage to escape from poverty sustain their escapes (the poverty
‘tripod’). It also raises the spectre that there may remain a billion people living in extreme poverty in 2030 unless existing
policies are implemented robustly and new policies and political commitments are up and running by 2020.
The bulk of the report focuses on the policies needed to get to zero. While there are many such policies, any country
could and should be able to generate a selection of the key policies that will work with the national grain, and the report offers
a device – the impoverishment index – to help countries determine the priorities that will carry their citizens out of poverty.
Acknowledgements
The Chronic Poverty Report 2014-15 is a team effort. Written by: Andrew Shepherd, Lucy Scott, Chiara Mariotti, Flora Kessy,
Raghav Gaiha, Lucia da Corta, Katharina Hanifnia, Amanda Lenhardt, Charles Lwanga-Ntale, Binayak Sen, Bandita Sijapati,
Tim Strawson, Ganesh Thapa, Helen Underhill, Leni Wild; edited by Katie Ellis and Angela Hawke; designed by Jojoh Faal.
The report also benefitted from contributions by Bill Walker, (World Vision Australia), Syliva Beales (HelpAge), Mark
Gorman (HelpAge), Emma Cain (ADD) and conversations with James Putzel (London School of Economics and Political
Science), Francesca Bastagli (ODI) and Tom Mitchell (ODI).
The list of reviewers is long. CPAN is extremely grateful to all of these for taking the time to make the report so much
better than it would otherwise have been.
Tony Addison, Angel Adelaja, Armando Barrientos, Bob Baulch, Shashanka Bhide, David Booth, Emma Cain, Isabelle
Cardinal, Blessings Chinsinga, Anne Floquet, Jörn Geisselmann, Duncan Green, Bara Gueye, Debbie Hillier, Rebecca Holmes,
David Hulme, Margaret Kakande, Hildegard Lingnau Simon Maxwell, Santosh Merhotra, Claire Melamed, Christian Möller,
Beatrice Mugambe, Lauchlan T. Munro, José Manuel Roche, Pauline Rose, Radhakrishna Rokkam, Laurent Ruedin, Saurabh
Singhal, Andrew Sumner, Fletcher Tembo, Amdissa Teshome.The Executive Summary and Overview also benefited from
close attention by Kevin Watkins and Andy Norton at ODI. The ODI Communications team provided its expertise on the
overall messaging of the report, generating a very healthy exchange of ideas that benefited the report as a whole.
The report has been supported by the Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) on behalf of
the Federal Ministry for Economic Cooperation and Development (BMZ). Thank you to Oxfam for funding the exploratory
research into resilience thresholds in Chapter 4. Responsibility for the content rests entirely with the writers.
ii The Chronic Poverty Report 2014-2015
Table of Contents
Preface and Acknowledgements i
Acronyms and abbreviations viii
Executive Summary 1
Introduction to Part A: Improving poverty dynamics 10
1. A recap and political perspective 11
2. Tackling chronic poverty 12
3. Stopping impoverishment 12
4. Climbing out, and staying out, of poverty 13
1 Chronic poverty: a recap and political perspective 15
1.1 Introduction 16
1.2 Explaining chronic poverty 17
1.3 Social norms and institutions 20
1.4 The significance of power for chronic poverty and adverse inclusion 21
1.5 From intersecting inequalities to injustices and chronic poverty 22
1.6 Towards ‘pro-poorest’ political settlements 29
1.7 Summary and conclusion 32
2 Tackling chronic poverty 35
2.1 Introduction 36
2.2 Tackling the vulnerability of the poorest through social assistance 36
2.3 Pro-poorest economic growth 39
2.4 Human development for the hard to reach 42
2.5 Transformative social change: from powerlessness to empowerment 44
2.6 Policies to tackle intersecting and horizontal inequalities and achieve a more just society 47
2.7 Summary and conclusion 50
3 Stopping impoverishment 52
3.1 Introduction 53
3.2 Macroeconomic vulnerability and the risk of impoverishment 56
3.3 Protection from economic shocks at the micro-level: from economic vulnerability to financial inclusion 57
3.4 Poor health and the risk of impoverishment 59
3.5 Protecting against a range of risks: the challenge of bringing social insurance to the poor 62
3.6 Conflict and the risk of impoverishment 63
3.7 Natural disasters and the risk of impoverishment 66
3.8 Summary and conclusion 70
4 Climbing out, and staying out, of poverty 74
4.1 Introduction 75
4.2 Climbing out of poverty 75
4.3 Staying out of poverty 76
4.4 Is there a resilience threshold? 78
4.5 Policies for resilient poverty escapes 79
iii
4.6 Education to transform lives 80
4.7 Land policy 82
4.8 Regional development 83
4.9 Summary and conclusion 84
Introduction to Part B: Can it be done? 86
5. What works? The drivers of success 86
6. A daunting task – projections of extreme poverty and human development deprivation to 2030 87
7. Goals and financial resources 88
5 What works? The drivers of success 91
5.1 Introduction 92
5.2 On the way to zero: progress to date on the reduction of extreme and severe poverty 93
5.3 Lessons from success: what drives reductions in chronic poverty? 95
5.4 Summary and conclusions 102
6 A daunting task - projections of extreme poverty and human development deprivation to
2030 105
6.1 Introduction 106
6.2 Projections compared: IFs projections (numbers and proportions) compared to other projections
of £1.25 a day poverty 107
6.3 The geography of poverty in 2030 108
6.4 Justified pessimism 116
6.5 Projections of human development deprivation and implications for intergenerational poverty in 2030 116
6.6 Summary and conclusion 120
7 Goals and financial resources 122
7.1 Introduction: global goals to tackle chronic poverty and improve poverty dynamics 123
7.2 Future goals: consensus and debate 125
7.3 Financial resources 126
7.4 How are donors responding? 133
7.5 Summary and conclusions 137
References 139
Annex 1: Glossary of key terms 155
Annex 2: Details of the representativeness of the panel surveys 159
Annex 3: The quality of escapes from poverty 160
Annex 4: LIC and MIC success 163
Annex 5: Projections derived from the International Futures model 164
Annex 6: The MDGs and the chronically poor – helping each other? 175
iv The Chronic Poverty Report 2014-2015
List of Boxes
Box 1: Definitions of poverty concepts used in the report 3
Box 2: New analysis in this report 7
Box 3: The structure of this report 9
Box 4: The Millennium Development Goals 11
Box 5: Identifying and defining the poorest 17
Box 6: The impact of negative shocks at critical moments in the life cycle: Lovemore, Zimbabwe 19
Box 7: The challenges faced by young people in escaping poverty traps in Ghana 19
Box 8: Child marriage and dowry in Bangladesh 21
Box 9: Inheritance-based destitution in Bangladesh 21
Box 10: Discrimination against disability as a cause of impoverishment in Bangladesh 22
Box 11: Adverse inclusion in the job market 23
Box 12: Increasing polarisation between the poorest and the middle class: how the poorest have been left behind by
development 23
Box 13: Drivers of land loss in Tanzania 25
Box 14: Bonded labour in Bangladesh agriculture 25
Box 15: Providing labour on credit in Tanzanian agriculture 25
Box 16: Child domestic labour in Bangladesh 26
Box 17: Migrant labourers in Bangladesh 26
Box 18: Women’s lack of agency in Tanzania 27
Box 19: Abandonment and widowhood in Tanzania 28
Box 20: Expulsion from the family through unemployment in Bangladesh 29
Box 21: Dynamic political settlements in Uganda and Rwanda: implications for maternal health 30
Box 22: Pro-poor political settlements and political trajectories in Latin America 30
Box 23: Solving the collective-action problem among the poor 31
Box 24: The integrated approach to social assistance 38
Box 25: Creating demand for an old-age social pension in Tanzania 38
Box 26: Babban Gona Farmers Organization, Nigeria 40
Box 27: Employment policies for decent work 41
Box 28: The potential for voluntary codes and standards to improve labour conditions 42
Box 29: Enhancing community accountability, empowerment and education outcomes in low- and middle-income
countries: the Vidya Chaitanyam Project (VCP) in Andhra Pradesh 43
Box 30: Access to education for excluded groups: nomads and pastoralists in Eritrea 43
Box 31: Financing equitable basic education in Kenya: underestimating the need for equity 44
Box 32: India’s Unique Identification (Aadhaar) project 44
Box 33: Stemming girls’ chronic poverty through institutional reforms 45
Box 34: A soap opera sparks debate on gender issues in India 46
Box 35: Ethiopia’s Berhane Hewan (‘Light for Eve’) 46
Box 36: Promoting the human rights of people affected by albinism in Uganda 47
Box 37: Tackling intersecting inequalities in Ethiopia 48
Box 38: Rights-based approach: a case study of India 49
Box 39: Policy responses to the food price crises and their potential impact on preventing impoverishment 56
Box 40: Economic vulnerability and risk of impoverishment in rural Tanzania 57
Box 41: Portfolios of the poor 58
Box 42: The pluralism of the Bangladesh health care system 59
Box 43: Universal Health Coverage in Burundi and Thailand 61
Box 44: How nutrition interventions interrupt the intergenerational transmission of poverty 61
v
Box 45: The Poverty Vulnerability Index (PVI) and the Multi-hazard Index (MHI) 67
Box 46: Turnaround in disaster-risk management in Senegal 69
Box 47: Disaster-risk management in India’s states 69
Box 48: Moving out of poverty and stopping its intergenerational transmission in rural Bangladesh 76
Box 49: Resilient livelihoods to prevent the intergenerational transmission of poverty in Tanzania 79
Box 50: Aspiring to go to secondary school in Tanzania 80
Box 51: Ten steps to build skills and pathways for a better future 81
Box 52: Reforming inheritance in sub-Saharan Africa 83
Box 53: Raising the age at which girls get married 93
Box 54: Increased labour income as a driver of poverty reduction in Brazil 96
Box 55: Improved infrastructure to increase returns to household assets in rural Bangladesh 97
Box 56: Education can increase the success of new businesses. The story of Jane from Kenya 98
Box 57: Getting poor girls into school in Ethiopia 98
Box 58: Declining maternal mortality in Nepal 99
Box 59: Making Nepal a more inclusive society: the 2007 Interim Constitution and Civil Service Act 101
Box 60: Governance at the heart of Cape Verde’s success 101
Box 61: Poverty projections using the International Futures (IFs) model 106
Box 62: Impact of the 2008 global economic crisis on poverty in developing countries 107
Box 63: India’s poverty according to various projections 108
Box 64: The intergenerational transmission of poverty: Sabrina, rural Tanzania 116
List of Figures
Figure 1: What happens to people who escape extreme poverty 2
Figure 2: The zero poverty tripod 3
Figure 3: Policies to tackle chronic poverty, stop impoverishment and sustain escapes from poverty 5
Figure 4: A dynamic post-2015 goal to eradicate extreme poverty 8
Figure 5: Life-history map for Amin, Male, 61 years old, rural Bangladesh 16
Figure 6: Explaining chronic poverty 17
Figure 7: Life History Map for Selina Ngungulo, 39 years old, rural Tanzania 18
Figure 8: Changes in land assets among the poor, poorest and median quintiles 1990s-2000s 24
Figure 9: Addressing intersecting and horizontal inequalities – the core ingredients 48
Figure 10: Poverty trends among ethnic minorities, China, India and Viet Nam 49
Figure 11: Poverty transitions – escapes and descents into poverty 53
Figure 12: Life-history map for Emanueli Mazua, 59 years old, rural Tanzania 55
Figure 13: Hazards and vulnerability to poverty in 2030 – overlaying the Multi-hazard Index and the Poverty
Vulnerability Index 66
Figure 14: What happens to people who escape extreme poverty? The fortunes of households that escaped poverty
between wave 1 and wave 2 77
Figure 15: Poverty escapes relative to the national poverty line 78
Figure 16: The factors associated with living in poverty, escaping poverty and sustained poverty escapes 79
Figure 17: Saw-tooth upwards mobility in rural Bangladesh : Monir, 46-year old man, Nilphamari District 80
Figure 18: Reducing severe poverty 94
Figure 19: Extreme poverty history and projection for India (IFs baseline) 108
Figure 20: $0.70 a day poverty in 2030, baseline, optimistic and pessimistic (millions of people) 111
vi The Chronic Poverty Report 2014-2015
Figure 21: $1.25 a day poverty in 2030, baseline, optimistic and pessimistic (millions of people) 112
Figure 22: Projected poverty headcount in 2030 by country income category 113
Figure 23: Projections to 2030, fragile and non-fragile states 114
Figure 24: Proportion of income poverty in 2030 at $0.70 a day (% of total population) 114
Figure 25: Proportion of income poverty in 2030 at $1.25 a day (% of total population) 115
Figure 26: Poverty Vulnerability Index, 2030, IFs baseline scenario 115
Figure 27: Projections of school life expectancy in 2030 (baseline, years of education) 117
Figure 28: Projections of under-five mortality in 2030 (baseline, deaths per thousand live births) 118
Figure 29: Overlap between low-income countries, fragile states and sub-Saharan African Countries 119
Figure 30: A dynamic post-2015 goal to eradicate extreme poverty 123
Figure 31: Population and number of people living in $1.25 a day poverty by level of government
spending per person 128
Figure 32: People living in $1.25 a day poverty, by government spending per person in each country, highlighting
those in South Asia and sub-Saharan Africa 129
Figure 33: Scatter graph showing government spending per person and the intensity of deprivation
among the poor in each country 130
Figure 34: Average government spending per person in 2011 and projections for 2030, for countries
with different current levels of domestic resources, and the number of people living in $1.25 a day
poverty (most recent estimates available) 131
Figure 35: The mix of resource flows to countries in each government expenditure per capita category, 2011 132
Figure 36: Comparing government spending on health with health deprivation 133
Figure 37: The number of people living in low-income countries who are poor or vulnerable to poverty
and are deprived in education 134
Figure 38: Health as a contributing factor to the Multidimensional Poverty Index and the proportion
of ODA received by each country that goes to the health sector 135
Figure 39: Education as a contributing factor to the Multidimensional Poverty Index and the proportion of ODA
received by each country that goes to the education sector 135
Figure 40: The estimated number of people who are living in multidimensional poverty and who are deprived
regarding child mortality, compared against the proportion of health ODA to each country 136
Figure 41: The estimated number of people who live in, or are vulnerable to, multidimensional poverty, and who
are deprived regarding years of schooling, compared to the proportion of education ODA to each country 136
Figure 42: Consumption, relative to the poverty line, in wave 2 of households escaping poverty between wave 1
(2008) and wave 2 (2010) (South Africa) 160
Figure 43: Consumption, relative to the poverty line, in wave 3 of households escaping poverty between wave 2
(2010) and wave 3 (2012) (South Africa) 161
Figure 44: Consumption, relative to the poverty line, in wave 2 of households escaping poverty between wave 1
(2005/06) and wave 2 (2009/10) (Uganda) 161
Figure 45: Consumption, relative to the poverty line, in wave 2 of households escaping poverty between wave 2
(2009/10) and wave 3 (2010/11) (Uganda) 162
Figure 46: IFs submodel interactions 164
vii
List of Tables
Table 1: Policy priorities, based on ratio between descents into poverty to escapes from poverty 7
Table 2: Indicators for a dynamic post-2015 goal to eradicate extreme poverty 8
Table 3: Types of social assistance 37
Table 4: Targeted services for migrant workers: the case of the Aajevika Bureau in Rajasthan, India 41
Table 5: Policies to address horizontal inequalities (HIs) 47
Table 6: An impoverishment index to measure the relative importance of flows across the poverty line 54
Table 7: Risks and policy measures 54
Table 8: Financial services preventing and causing impoverishment 58
Table 9: Trajectories of fragility and resilience 64
Table 10: Total poverty projections for the top 45 countries prone to drought, extreme heat and floods in 2030 –
baseline and optimistic scenario (millions of people) 67
Table 11: Aims and activities of a national disaster-risk management system 68
Table 12: Categories of countries according to their current disaster-risk management capacity and their
ability to manage and cope with future shocks and stresses 68
Table 13: Key stakeholders’ strategies on the road to zero 89
Table 14: Progress on the reduction of chronic poverty (using national poverty lines) 92
Table 15: The top performing low-income and middle-income countries between 1990 and 2010 93
Table 16: Reducing intergenerational poverty 95
Table 17: Countries with the greatest percentage reduction in their fertility rates between 1990 and 2010 100
Table 18: Parameters of the IFs model manipulated for the projections 106
Table 19: A comparison of estimates with the IFs projection used in this report 107
Table 20: Baseline projection: millions of people and proportion of the population living in severe poverty,
extreme poverty and on less than $2 a day 109
Table 21: Pessimistic scenario: millions of people and proportion of the population living in severe poverty,
extreme poverty and on less than $2 a day 109
Table 22: Optimistic scenario : millions of people and the proportion of the population living in severe poverty,
extreme poverty and on less than $2 a day 110
Table 23: Regional and global projections (2030), optimistic, baseline and pessimistic scenarios
(millions of people) 113
Table 24: Lowest school life expectancy in 2030 117
Table 25: Highest child mortality rates predicted in 2030 118
Table 26: Illustrative indicators for a dynamic poverty eradication goal 124
Table 27: Policy options to address chronic poverty and poverty dynamics and by comparison with inequality 124
Table 28: Consensus goals for the post-2015 development agenda 126
Table 29: Post-2015 development goals which require more work to get broad agreement 127
Table 30: Country rankings of success at reducing severe poverty alongside improving human development,
gender equality and food security between 1990 and 2010 163
Table 31: Parameters used to create optimistic and pessimistic scenarios in Chapter 6 164
Table 32: Country projections of $0.70 a day poverty for the baseline, optimistic and pessimistic scenarios
(in millions of people) 165
Table 33: Country projections of $1.25 a day poverty for the baseline, optimistic and pessimistic scenarios
(millions of people) 169
Table 34: 2030 projected $0.70 poverty in 2013 fragile states 172
Table 35: Poverty Vulnerability Index Rankings 174
viii The Chronic Poverty Report 2014-2015
Acronyms and abbreviations
ADLI Agricultural-Development Led UNESCO United Nations Educational, Scientific and
Industrialisation (Ethiopia) Cultural Organization
BRAC formerly Bangladesh Rural Advancement UNFPA United Nations Population Fund
Committee (now known by acronym) UNESCO United Nations Educational, Scientific and
CPAN Chronic Poverty Advisory Network Cultural Organization
CPRC Chronic Poverty Research Centre UNFPA United Nations Population Fund
DAC Development Assistance Committee UNICEF United Nations Children’s Fund
DHS Demographic and Health Surveys UPE Universal Primary Education
DRC Democratic Republic of Congo USAID United States Agency for International
DRM Disaster-risk management Development
EPRDF Ethiopian People’s Revolutionary Democratic WHO World Health Organization
Front
FDI Foreign Direct Investment
GDP Gross Domestic Product
IFES International Foundation for Electoral
Systems
IFs International Futures
IMF International Monetary Fund
LIC Low-income country
LMIC Lower middle-income country
MDGs Millennium Development Goals
MFI Microfinance institution
MHI Multi Hazard Index
MIC Middle-income country
MNE Multinational enterprises
MPI Multidimensional Poverty Index
ODA Official development assistance
ODI Overseas Development Institute
OECD Organisation for Economic Co-operation and
Development
PPP Purchasing power parity
PVI Poverty Vulnerability Index
PSNP Productive Safety Nets Programme (Ethiopia)
PWD Persons with disabilities
PWLD Persons with learning disabilities
PWP Public works programme
ROSCAs Rotating savings and credit associations
RRR Relief, reconstruction and recovery
SHI Social health insurance
SMEs Small and medium enterprises
UHC Universal Health Care
UMIC Upper middle-income country
UN United Nations
UNCRPD UN’s 2006 Convention on the Rights of
Persons with Disabilities
UNEP United Nations Environment Programme