Module 1: Poverty reduction with a livelihood focus
1.2: Meaningful concepts of poverty for effective poverty reduction
Approaches to reduce poverty are informed by and based on conceptual perceptions of poverty. This underscores the relevance of meaningful concepts and indicators. Criteria should be defined and indicators specified according to the purpose envisaged. Simple poverty line concepts, for instance, allow comparisons and the tracing of impacts. Yet, tackling poverty requires poverty concepts that lead to meaningful development hypotheses. The poverty concept developed by the Development Assistance Committee (DAC) of the OECD in its guidelines on poverty reduction represents a generally accepted approach that also corroborates the need for applying a livelihood focus, especially when dealing with a poverty concept based on a capability perspective. The following five core dimensions are drawn from the 2001 DAC Guidelines in their original wording page 38 (see http://www.oecd.org/dataoecd/47/14/2672735.pdf).Defining poverty: the core dimensions
Economic capabilities mean the ability to earn an income, to consume and to have assets, which are all key to food security, material well-being and social status. These aspects are often raised by poor people, along with secure access to productive financial and physical resources: land, implements and animals, forests and fishing waters, credit and decent employment.
Human capabilities are based on health, education, nutrition, clean water and shelter. These are core elements of well-being as well as crucial means to improving livelihoods. Disease and illiteracy are barriers to productive work, and thus to economic and other capabilities for poverty reduction. Reading and writing facilitate communication with others, which is crucial in social and political participation. Education, especially for girls, is considered the single most effective means for defeating poverty and some of its major causal factors, for example illness - in particular AIDS - and excessive fertility.
Political capabilities include human rights, a voice and some influence over public policies and political priorities. Deprivation of basic political freedoms or human rights is a major aspect of poverty. This includes arbitrary, unjust and even violent action by the police or other public authorities that is a serious concern of poor people. Powerlessness aggravates other dimensions of poverty. The politically weak have neither the voice in policy reforms nor secure access to resources required to rise out of poverty.
Socio-cultural capabilities concern the ability to participate as a valued member of a community. They refer to social status, dignity and other cultural conditions for belonging to a society which are highly valued by the poor themselves. Participatory poverty assessments indicate that geographic and social isolation is the main meaning of poverty for people in many local societies; other dimensions are seen as contributing factors.
Protective capabilities enable people to withstand economic and external shocks. Thus, they are important for preventing poverty. Insecurity and vulnerability are crucial dimensions of poverty with strong links to all other dimensions. Poor people indicate that hunger and food insecurity are core concerns along with other risks like illness, crime, war and destitution. To a large extent, poverty is experienced intermittently in response to seasonal variations and external shocks - natural disasters, economic crises and violent conflicts. Dynamic concepts are needed because people move in and out of poverty. Today's poor are only partly the same people as yesterday's or tomorrow's. Some are chronically poor or inherit their poverty; others are in temporary or transient poverty.
Definitions and interactive core dimensions of poverty and well-being
(Adapted from OECD (2001), The DAC Guidelines: Poverty Reduction, pp. 38-40)
"An adequate concept of poverty should include all the most important areas in which people of either gender are deprived and perceived as incapacitated in different societies and local contexts. It should encompass the causal links between the core dimensions of poverty and the central importance of gender and environmentally sustainable development" (OECD, 2001, p. 38).
