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Updated: September 23, 2009 18:13 IST

Trends in global poverty

K. SUBRAMANIAN
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This hefty work, the first in a series of annual volumes, deals with poverty reduction issues.

Analysing historical data as was done by Simon Kuznets or Colin Clark is a different ball game, compared with those engaged in forecasting economic trends. Futurology is as alluring as it is treacherous. The World Bank and the International Monetary Fund have been churning growth and poverty forecasts and revising them as often. During the current crisis, they seem to have lost their shine.

So, when an academic centre — The Frederick S. Pardee Center for International Futures - attempts to forecast fifty-year trends in global poverty, it strains credibility.

The Center is a part of the Joseph Korbel School of International Studies, University of Denver. International Futures (IFs) is a large-scale, long-term, integrated modelling system.

It is said to represent demographic, economic, agricultural, socio-political and environmental subsystems for 183 countries interacting in the global system. In the early years, IFs’ role was confined to technology and security issues along with RAND. It is now engaged in producing a series of annual volumes on ‘Patterns of Potential Human Progress (PPHP).’ The one under review is the first in the series and is devoted to poverty reduction issues.

By any test, it is a weighty volume — in scope, contents, and analysis. Its strength lies in that it is not assertive or pontifical and is conscious of the limitations attached to the estimates. The authors aver that IFs provides “tendencies” rather than “predictions” of how the real world will behave.

In the Introduction, it is claimed that the authors “have looked to the accumulated theoretical and empirical knowledge about the drivers of change and turned to computer simulation of global change as a principal tool for analysis.” This claim is borne out by the analysis of issues governing poverty in all chapters, especially the third and the fourth. They take note of proximate drivers of poverty as growth, inequality, and population and how they form the three vertices of a “triangle” arithmetically connected.

Evaluation

While dealing with “growth” as a driver, there is an incisive analysis of current debate, especially on how growth by itself would not reduce poverty. They study the “paradox of persistent global poverty” and suggest how the impact of growth on poverty reduction varies from country to country and also depends on the nature of growth. This debate was creeping into the corridors of the World Bank and led to shifts in policies and adoption of pro-poor growth policies with emphasis on infrastructure, job creation, and so on.

There is an interesting evaluation of the World Development Reports (WDRs) from 1980 to 2000. It draws attention to shifts in emphasis from growth per se to pro-poor growth and policies to promote “governance” and “stability.”

Though the authors point out the inadequacies of the Bank policies, they avoid any direct criticism of the Washington Consensus or structural adjustment policies. It is significant that they emphasise there is no silver bullet to fight poverty. “Identification of prospective silver bullets changes over time and across philosophical viewpoints.” Elsewhere they refer to significant interventions that can make great contributions to reducing poverty and explain how “they achieve much more significant results in combination than individually.”

The analysis of ‘the multiple faces of poverty and its future’ portrays global trends in poverty reduction. Country/region-specific problems are identified and broader trends attempted.

In Africa, it is the ‘resource curse’, ‘governance,’ and ‘corruption.’ The authors admit that they tend to err more on the pessimistic side than on the optimistic. They contrast this with the views of economists like Simon Johnson and Arvind Subramanian who are more upbeat on Africa based on fundamentals.

Study on India

India has been studied closely and the assessment is rather dim. Their concern is about the Middle India (Hindi belt!) and they feel that in contrast to other regions, “poverty numbers may be relatively unchanged through the MDG target year of 2015.” By then, the subregion could account for 45 per cent of extreme poverty in Asia and the Pacific and by 2030 the proportion could touch 50 per cent. Overall, they tend to take the view that the combined intervention scenario clearly has much less impact on Asia than it has on Africa. This runs contrary to the currently held notions on Asian future. They also take the view that globally MDGs will not be reached.

Impact

There is an analysis of “poverty in a broader context” capturing what may be termed non-quantifiable variables impacting poverty. These are: natural resources, environment, conflict, stability, governance, and socio-political institutions. In several places, special emphasis is laid on governance and corruption standing in the way of poverty reduction. “Resource curse” is another favourite topic for all development research work among western economists. It is not denied that these militate against poverty programmes. But much of the thinking is conditioned by the research done in the World Bank which is unfortunately one-sided. Yes, the political class in developing countries owes a responsibility. But, how can they exclude the greed and aggrandisement of the MNCs who promote conflicts in their search for scarce raw materials and also fund private military organisations? These are unresolved issues.

The book has gone into several issues with scholarly dedication and detachment. It provides a sound base for further research on many issues raised by the authors.

REDUCING GLOBAL POVERTY — Patterns of Potential Human Progress, Vol. 1: Barry B. Hughes, Mohammod T. Irfan, Haider Khan, Krishna B. Kumar, Dale S. Rothman and Jose R. Solorzano; Oxford University Press, YMCA Library Building, Jai Singh Road, New Delhi-110001. Rs. 995.

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