Is world poverty declining and if so why?

Is world poverty declining and if so why? It’s a deceptively simple question with no straightforward answers, as keynote presenters Joe Stiglitz and David Hulme confirmed at this morning’s opening session (well, it is an academic conference so what did you expect?) Read on...
Michael Edwards
8 September 2010

Measurements of ‘global’ poverty are fairly meaningless since they disguise enormous variations between different countries, and no-one seems able to agree on what poverty means or how it should be measured – not exactly the ideal basis for a conversation about lessons learned. Poverty can go down while inequality and insecurity go up, and incomes can rise even though people’s wider sense of wellbeing is falling.

Stiglitz opened the proceedings with a few statistics and then rambled on for far too long. China, for example, had 673 million people living on incomes below US$1.25 a day in 1990 and ‘only’ 208 million in 2005, a dramatic fall in poverty, especially in percentage terms. By contrast, Sub-Saharan Africa saw an increase from 298 million to 388 million over the same period, though because of population growth the percentage of people living in extreme poverty fell from 57 per cent to 51 per cent – not exactly the African economic renaissance we’ve been hearing about from some pundits lately but evidence that progress is being made.


When it gets to explaining these trends and patterns the picture is even muddier, but both speakers were clear that the huge international machinery behind the Millennium Development Goals (MDGs) has been fairly unimportant – a sobering conclusion for the UN General Assembly when it meets to review them in two weeks time. In explaining the poor performance Stiglitz laid a lot of stress on the deterioration of global finances, the malign influence of the so-called “Washington Consensus,” and a failure to invest in effective civil society and governance. Not much new there so what’s the bottom line? “Trickle-down economics don’t work.” “We should encourage new innovations like micro-credit, more efficient cooking stoves, social forestry, cash transfers and Oral Rehydration Therapy” – all interesting stuff but difficult to see how they add up in terms of State-building or the reform of global governance. I’d give the professor a B+ but hey, he won the Nobel Prize for economics, not me.

David Hulme’s presentation was spunkier though a little strange (neither speaker framed the spectrum of experiences of poverty-reduction over the last ten years to help participants make sense of all the different papers that are going to be delivered). Hulme’s thesis is that the gap between promises and delivery in foreign aid has been increasing over the last five years, with too much of a focus on planning, strategizing and management and not enough on changing the norms and values that underpin real progress, including the crucial issue of who sits in the driving seat. The MDG process was “the best political deal” that could have been struck ten years ago, but has been way too technocratic, top-down and dominated by interests in the North. The real problem is that “we” (meaning the majority of people in both rich and poor countries) “don’t care enough to make extreme poverty morally unacceptable in an increasingly-affluent world.”

This is undoubtedly true, but as two members of the audience pointed out in question-time, focusing our efforts on changing norms may not be the right conclusion – first, because it’s so difficult and second, because there’s a clearer and easier route to improvement: forget the MDGs and the proliferating industry of consultants and advisers that surrounds them, and focus on what’s happening in countries that are trying, and in many cases succeeding, in reducing poverty, which after all, is a deeply political process. Let’s see if the rest of the conference follows up this intriguing line of logic.  

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