Why Measure Poverty?

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July 20, 2012

Steve Wright is Vice President, Poverty Tools and Insights for Grameen Foundation. He recently wrote a blog post for Nexii.com. We have included an excerpt below, along with a link to the full post.

Let’s start with the realization that poverty is bad. The hardships of the poor fill heartstring-pulling fundraising campaigns: unsafe drinking water, poor diets, poor education, untreated illnesses, saving cash under a mattress, danger, a roof that leaks, no access to the information we take for granted, and more. These hardships make life more difficult for the poor than the not-poor. But this is not the only reason why poverty is bad.

Poverty is also bad because it hurts us all.

A very simple logic model for Poverty Alleviation

The Theory: Poverty is an economic anchor. Those living in poverty (an economy’s losers) cannot be producers in the system. They are not generative. Meanwhile, the economic ‘winners’ remove their winnings and invest them in other markets or economies where they can earn a better return. And so, economies with severe inequality drag and leak, like a neglected ship with lifeboats for only a fraction of the passengers. However, people are not poor because of a lack of capacity and the prejudiced view that ignores this capacity is what makes poverty epidemic.

The Change: Economic success is defined as a state where the maximum number of people are generating value in an economy and receiving benefit from their work.

The Work: With strong local leadership, a community can invest in the generative capacity of the poor through education, health care and access to markets.

At Grameen Foundation, we try to catalyze the change described above. We implement interventions that provide valuable missing information to the poor to enable them to be equal actors in specific markets (agriculture in Uganda and Colombia and prenatal health in Ghana and the state of Bihar in India). We design and test innovative financial services products (microsavings and mobile financial services). We build mobile enabled technology to maximize the impact of those that serve the poor. And finally, we know we are serving the poor in all of these interventions because we measure poverty and use that information to inform our interventions.

To do the above with appropriate design and rigor we must have the ability to measure poverty.

Continue reading at the Nexii.com blog >>

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