For decades, policy makers in governments and multilateral institutions have been attempting to find a workable model that would end poverty. The World Bank’s latest study, Moving out of Poverty: Success from the Bottom Up, offers a change in approach, as it analyses the issue from a perspective closer to the ground. Its major finding, that individual initiatives substantially helped people in pulling themselves out of poverty, should serve as a pointer to policy makers. Of great significance from the standpoint of reshaping poverty eradication strategies is that, of the reasons cited by respondents who have moved out of poverty, the top three were: non-agricultural individual initiatives such as finding a job, investing in business, and migration (60.1 per cent), individual initiative in agriculture (17.4 per cent), and asset accumulation (4.7 per cent). No less noteworthy are the three figuring at the bottom: assistance from non-government organisations (0.3 per cent); illegal activities (0.1 per cent); and lottery/luck (0.0 per cent). As the study rightly observes, “charity-oriented and other paternalistic programmes may ease the pain for a few in the short run, but they are totally inadequate to lift entire nations or communities out of poverty.” What emerges from all this is that the outcomes of poverty eradication programmes could be transient, if they are not supplemented by other state-led support structures, particularly access to healthcare and education.
In the late 1970s, when poverty eradication became a global priority, about 40 per cent of the developing world lived in absolute poverty (World Development Report 1978). According to the World Bank figures (2008), more than one-fourth of the developing world’s population is living below the poverty line now. The world’s battles against poverty, evidently, are not being won convincingly. Given the magnitude of the crisis, top-down policies tend to spread the benefits thin, resulting in vulnerability and relapse. Since a sharp decline in the level of national/local prosperity is a major cause for individuals slipping into poverty — a proposition endorsed by the latest study — any anti-poverty strategy, to be effective and meaningful, should seek to create a system that improves local economies. There are successful examples, from India and abroad, of initiatives that tapped into the resources of the millions at the bottom of the economic pyramid. The building blocks required for ending poverty are huge social sector investments and economic avenues for the poor to channel their productive capabilities.