How can we eliminate extreme poverty?
On 21 October, an all-day case study launch event “ How can we eliminate extreme poverty?” featured the launch of the Development Progress extreme poverty case studies alongside other presentations on different aspects of measuring and tackling extreme poverty.
In the first panel, ‘Promoting Pro-poor Policy’ (chaired by Espen Prydz, World Bank), panellists presented cross-country analysis and success stories from South East Asia and East Africa, and detailed studies of Ecuador and Ethiopia. Chris Hoy opened the session in a presentation that sought to ‘de-mystify myths about pro-poor growth’ by focusing on the relationship between growth, inequality and poverty reduction across developing countries. In debunking these ‘myths’, he showed that growth may not benefit the poor as much as everyone else and that pro-poor growth may not reduce the income gaps between rich and poor.
Following this, Andrew Shepherd (Director, CPAN) then compared pro-poor growth experiences in several East African and East Asian countries – pointing, in particular, to the need for rural diversification and for countries to create their comparative advantage. Alebel Bayiru Woldesillasie (Ethiopian Development Institute) spoke to Ethiopia’s impressive poverty reduction over the 2000s, focusing on income poverty, education and employment, while Andrea Ordonez (Southern Voice on Post-MDG International Development Goals) gave an overview of Ecuador’s success in reducing extreme poverty through the creation of macroeconomic stability, labour market policy and social protection. Questions addressed the role of specific factors in reducing poverty – ranging from irrigation, to microfinance to conditional cash transfers – as well as how policy could truly reach the most deprived.
The second panel, ‘New global poverty numbers’ (chaired by Claire Melamed, ODI), featured presentations from experts on the measurement of poverty at a global level. Dean Joliffe and Espen Prydz from the World Bank gave an overview of the new poverty numbers the World Bank has just released (in 2011 Purchasing Power Parity), and potential refinements. Notably the presentations showed that the $1.25 poverty line, updated to 2011 PPP is now at $1.90 and that the poverty numbers are fairly similar to those estimated in 2005 PPP. Prydz suggested different poverty lines for countries at different income levels and gave examples of reasonable thresholds.
Martin Ravallion (Georgetown University) then spoke to the need to complement current 2011 PPP numbers with poverty measures that incorporate relative deprivation and minimum welfare considerations . He estimated the minimum ‘consumption floor’ at about $.67 and noted that it has risen very little over the last thirty years. Discussant Frances Stewart (University of Oxford) then pointed to difficulties in measuring income poverty and argued that data on non-income dimensions are also needed to measure poverty well. Questions focused on the value of multidimensional poverty relative to income measures and the need for a ‘dashboard’ to monitor and guide poverty reduction.
Finally, in the third panel, ‘Data gaps and implications’ (chaired by Emma Samman, ODI), panellists focused on gaps that affect the data that can be used to pursue a poverty-reducing agenda and their implications. Roy Carr-Hill (University of York and Institute of Education, London) discussed exclusions in household surveys both ‘by design’ and ‘in practice’ and argued that 300-500 million of the world’s poorest may be missing from official statistics as a result. Amina Khan (ODI) then outlined how politics can affect interpretation and acceptance of poverty numbers, focusing on the case of Pakistan.
Closing the day, Eduardo Clark (Office of the Presidency of the Republic, Mexico) then focused on how the Mexican government is compensating for data gaps in practice, on the need to incorporate unofficial data sources to improve the spatial and temporal availability of data and on the value of open data initiatives. In the ensuing discussion, participants raised questions regarding how exclusions can be addressed and the importance of data to the ‘leave no one behind’ agenda of the SDGs.
What will ending extreme poverty mean at a national level? How many poor people are there in the world at present? What data gaps impede our understanding of poverty and of policy?
To discuss these issues we organised a day-long event with three expert panels.