What is poverty?
The concept of ‘poverty’ is often difficult to define as it includes an array of multi-dimensional socio-economic indicators that have to be adjusted to align with various regional characteristics. For example, what poverty means in the United States will be slightly different from what it means in the sub-Saharan region.
One way to look at poverty is through the lens of income levels. Thus, there is:
- Absolute poverty which relates to people with inadequate income levels to meet the cost of the basic necessities of life (food, water, shelter, clothes, or security) and
- Relative poverty which involves the inequalities of income distribution and refers to those who are not able to obtain essential goods and services at a 50% level of the societal standard.
Another way to look at poverty is through specifically designed methodological tools such as the Global Multidimensional Poverty Index (MPI) developed by the United Nations Development Programme (UNDP) which is built around 10 indicators in health, education, and standards of living.
Causes of poverty
1. Lack of income and assets: without a stable and decent income, people are more prone to face poverty as they lack the necessary resources to meet their basic needs. Moreover, the absence of human assets (capacity for basic labor, health), natural assets (such as land), social assets (such as networks of contacts), or financial assets (such as access to savings or credits) will amplify the incidence of poverty.
2. Hunger and malnutrition: lack of nutritious and healthy food leads to energy and strength depletion, thus preventing a person from finding work or performing a job.
3. Inequality and marginalization: unfair social distribution systems and unequal access to community resources can amplify the risks of poverty.
4. Conflict: large scale conflicts, such as wars or civil acts of violence, will force a significant number of people into poverty. The most relevant example is Syria where over 70% of the population has been forced into some form of poverty since 2011.
5. Poor education: many of those living in poverty lack education and basic reading/writing skills. This, in turn, limits the possibility of entering the job market and accessing decent-paying jobs.
6. Voicelessness and powerlessness: materially deprived people or those without social support will be more likely to lack the ability to express their views or stand up for themselves and are thus more likely to face rude, humiliating, or inhumane treatment.
7. Climate change: the negative effects of climate change are having a serious impact on communities that are dependent on agriculture and are considered to be a factor that may lead to the impoverishment of up to 132 million people around the world within the next decade.
8. Poor healthcare systems: people who lack access to decent and efficient healthcare will be more likely to suffer from various preventable illnesses and ultimately may lose their working abilities and thus facing deepening poverty.
9. Lack of governmental support: ineffective social and economic support systems will leave many people in need to face the burdens of poverty alone.
10. Little or no access to clean water, sanitation, and hygiene: three in 10 people or 2.1 billion worldwide still lack access to clean and readily available water which in turn leads to the death of 361,000 children under the age of five every year due to transmittable diseases such as cholera, dysentery or hepatitis A.
Some global poverty facts
- Over the last decades, the international community has made considerable progress in reducing poverty with over 1.2 billion people having been elevated out of extreme poverty since 1990.
- Based on 2018 World Bank data, the highest rates of extreme poverty were observed in sub-Saharan Africa at 40.2% followed by the South Asian region at 10%.
- The COVID-19 crisis is considered to be the most important factor that has caused a significant reversal in global poverty rates.
- According to the World Bank, the number of people who could be forced back into extreme poverty due to the pandemic could reach 150 million.
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