The economics of poverty traps and persistent poverty: An asset-based approach

Longitudinal data on household living standards open the way to a deeper analysis of the nature and extent of poverty. While a number of studies have exploited this type of data to distinguish transitory from more chronic forms of income or expenditure poverty, this paper develops an asset-based approach to poverty analysis that makes it possible to distinguish deep-rooted, persistent structural poverty from poverty that passes naturally with time due to systemic growth processes. Drawing on the economic theory of poverty traps and bifurcated accumulation strategies, this paper briefly discusses some feasible estimation strategies for empirically identifying poverty traps and long-term, persistent structural poverty, as well as relevant extensions of the popular Foster-Greer-Thorbecke class of poverty measures. The paper closes with reflections on how asset-based poverty can be used to underwrite the design of persistent poverty reduction strategies.     

The knowledge-interest context of local public finance: Judgments of city finance officers

A potential constraint on local public finance decision making is the distribution of knowledge of, and interest in, public finance issues within a community. Since city finance officers occupy strategic positions in local government and politics an understanding of their assessments of the local knowledge-interest context is preliminary to financial management capacity building initiatives. This article considers the judgments of seventy Ohio city finance officers on the level of local government finance knowledge and interest in their communities. Alternative explanations for variation in judgments on the knowledge-interest context are tested. While little variation is explained by aggregate city characteristics, local financial management professionalism, or city government structural arrangements, variables related to city specific political factors do tend to have considerable explanatory power.     

No end to poverty

This commentary is designed to provide a critique of Jeffrey Sachs' The End of Poverty: How We Can Make It Happen In Our Lifetime, highlighting in particular the difficulties that arise from his focus on absolute poverty and his proposed recipe for its elimination. It begins by emphasising the many strengths of Sachs' arguments, but then suggests that these could usefully be tempered by greater attention to relative conceptualisations of poverty and the ethical grounds upon which his arguments are based. Six main issues are subsequently addressed: his use of the notion of a ladder of development; his concentration on countries rather than people; his understandings of geography and of history; his relative lack of attention to social and cultural dimensions of development; the inability of poor countries to absorb the levels of aid that he proposes; and the damage caused by suggesting that it is indeed possible to end poverty.     

Developments in health care finance

Costs, quality, and access are the central themes in health care policy in the United States. In the 1980s the predominate issue is becoming access, and the likelihood for universal health coverage, or a national health insurance program, is growing. This paper explores how the America health care system got to this point and examines the present conditions, the trends, and the consequences of those trends.     

Chronic poverty and entitlement theory

This paper examines chronic poverty in the developing country context within the entitlement theory approach. The dialogue on entitlement theory originally introduced by Sen is extended here to explore poverty and its persistence, or chronic poverty. A conceptual framework is presented, in which poverty and its persistence are explained within the context of the individual's economic and non-economic situation and development incentives. These attributes are influenced by the individual's entitlements. It is shown that poor endowments and resource base are important causes of persistent poverty. Policies aimed at reducing poverty therefore must address problems associated with improving the entitlements of individuals and households. The definition of ‘entitlements’ in the paper is not restricted to material possessions—the economic entitlements of the individual or the household—but is extended to incorporate the individual's skills, education and productive ability—the non-economic entitlements. The discussion is rooted in the increasing awareness of multidimensional poverty. The paper focuses on rural poverty in certain parts of India, where most of India's chronic poverty is situated. Over a million people can be classified as chronically poor in terms of duration, severity and deprivation. This is despite the government's commitment to the eradication of poverty since the early 1950s, with a total expenditure of nearly $7 billion in the past 50 years.     

Networked poverty in rural Russia

This article attempts to apply major ideas developed in Anglo-American ‘network analysis’ to enlarge geographical constructions of the rural ‘problematic’ in Russia. It interrogates complex understandings of ‘poor people’ via a study of social networks in two villages in Central European Russia, focusing on connections between different actors embedded in social contexts in the countryside, different forms of associations between rural people, and the ways in which specific forms of their interrelations affect poverty. In so doing, the article attempts to reconnect different positions of rural people in Russia and different transitory aspects of ‘poor’ identities (i.e. of people in poverty), as well as to broaden understanding of differentiated experiences of rural poverty.     

Global poverty and orthodox security

This article examines the way in which the discourses of security and development have merged in the past decade as an important strand of global governance. It shows why this merging of discourses has occurred and assesses whether the newly embedded security-development discourse provides adequate conceptual tools for understanding the causes of global poverty. It concludes by setting out three paths that emerge from this security-development discourse and suggests that the ontological and epistemological claims at the heart of this understanding of International Relations and global poverty serve to reinforce global hierarchies of social power and privilege.     

The coup: A critical restatement

Coup d'État, a practical handbook. Edward Luttwak, London: Wildwood House. 1979. 215 pp. £5.95.     

The employment of finance in small business

Small‐scale businessmen everywhere, and particularly in developing countries, believe that their most pressing problem, if not their only one, is lack of finance. Organisations devoted to the promotion of small business have come to believe that finance must be accompanied by management advice. It is suggested that such advice should in fact precede any consideration of financial assistance; this will not only improve the chances of effective use of the additional finance, if it is eventually provided, but, more important still, it may show that there is in fact no need for more capital at all.     

Macroeconomic performance and poverty in Brazil

Drawing on Brazilian time-series data this study finds an inelastic link between poverty and wages over the macroeconomic cycle that is devoid of the asymmetric effects that characterise the phenomenon's response to changes in the rate of unemployment. Deepening of structural reforms in the second half of the 1990s had no effect on the aforementioned relationships, which also varied little by regional level of development. Finally, the connection between poverty and long-term income changes was more elastic, suggesting an association between the economy's recent disappointing performance in alleviating poverty and its lacklustre growth record over the past two decades.     

Persistent poverty in North East Ghana

This paper explores local poverty and wealth inequality in the Upper East Region of northern Ghana in the period from 1975–89. Land was not scarce and the social management of household membership and household labour were critical to household security, but this social management was not independent of wealth status. There was a virtuous circle between wealth and household labour supply and a vicious circle between poverty and small household size. Poverty traps existed so that those with too little labour and too little wealth engaged in strategies which entrenched them in poverty.     

Alleviating rural poverty through agricultural growth

The article examines the role of agricultural GDP growth in alleviating rural poverty in LDCs. Cross‐sectional regression analysis indicates that GDP growth by itself takes a very long time to reduce poverty significantly. It suggests that decreases in land concentration could have a more immediate impact on reducing rural poverty; the budgetary and other costs of implementing such changes are not, however, considered. The preferred approach is a combination of equitable growth and redistributive measures.     

Women in development: A critical analysis

In the early 1970s a general disenchantment with development efforts in Third World countries led to a search for alternative development strategies and a growing awareness that women, like the poor, were peripheral to the development efforts of major aid donors. In 1972 the United Nations designated 1975 as International Women's Year, highlighting the need to involve women in issues of economic development. During the past 20 years the 'women in development' approach, which seeks to recognise and integrate women in aid policies and programmes, has been incorporated into the aid practice of most development agencies. This paper traces the efforts of large aid agencies over the past two decades to integrate women into their aid programmes and discusses the main limitations and weaknesses of the WID approach.     

The impact of tariff removal on poverty in Zimbabwe: A computable general equilibrium microsimulation

The paper uses a microsimulation computable general equilibrium (CGE) model to study the impact on poverty of a complete removal of tariffs in Zimbabwe. The model incorporates 14,006 households derived from the 1995 Poverty Assessment Study Survey. This paper's novelty is that it is one among a small group of papers that incorporates individual households in the CGE model as opposed to having representative households. Using individual households allows for a comprehensive analysis of poverty. The complete removal of tariffs favours exporting sectors. Poverty falls in the economy while inequality hardly changes. The results differ between rural and urban areas.