Global Poverty: Poor and Ultra-poor

Tina Rosenberg reports that although the global poverty numbers have decreased since the 1970s, the ultra-poor have remained ultra-poor over the same time period. That’s because ultra-poverty “is a trap so deep, people can’t take advantage of ways to improve their lives.”

One organization has a plan to move the global ultra-poor out of the ultra-poverty cycle: Ultra-Poor Graduation Initiative in BRAC USA, an affiliate of the giant antipoverty group BRAC (forrmerly named the Bangladesh Rural Advancement Committee). BRAC’s plan involves giving folks an asset that can generate money (such as a cow, chickens, goods to start a store, or land) and a food or cash grant. BRAC also sets up committees in local villages, for the purpose of educating residents, and provides training in growing and maintaining vegetable gardens. BRAC commits to work with individual communities for a two year period, to make sure that the residents have a substantial boost to exit ultra-poverty.

Rosenberg reports that BRAC produces remarkable results:

“Virtually all the participants changed their lives. A year after the program ended, 97 percent had satisfied at least six of 10 indicators (having things like cash savings, steady access to food, diversified income, a latrine, a tin roof, or using family planning) and were considered graduated. Three years later, the number was 98 percent.”

Based on BRAC’s success in Bangladesh, its program has expanded to 20 countries. As Rosenberg notes:

“Although the countries varied in numerous ways, the program succeeded everywhere. Families ate more, were more certain about access to food, held more assets, had more income and savings, spent more time working, and enjoyed better mental and physical health. Women had more say in family decisions. When families were revisited a year after the program stopped, the benefits had largely persisted, and in some cases had increased.”

To conclude her article, Rosenberg adds:

In a lecture at Harvard, Esther Duflo argued that something less tangible is going on: the effect of suddenly having hope. “What we hypothesize, although we cannot directly confirm it using this data, is that this improved mental health is what gave participants the energy to work more, save and invest in their children — we see in the data that children spend more time studying,” she said. “A little bit of hope and some reassurance that an individual’s objectives are within reach can act as a powerful incentive.”

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