Even in the poorest areas of the world, moving out of poverty is possible when poor people’s individual initiative and hard work are matched by economic opportunities in their local communities, shows new World Bank research based on the views of thousands of poor people around the globe.
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But according to Moving out of Poverty: Success from the Bottom Up, poverty reduction remains a challenge because many people fall back into poverty. In fact, across the studied (mainly rural) communities in the world, close to half the population is moving up or down the socioeconomic ladder, often with the same people rising and then falling at different times.
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“In the midst of the worst financial crisis since the Great Depression, we need to understand the dynamics of poverty better by listening to what the poor themselves have to say,” said Danny Leipziger, World Bank Vice-President. “Their stories show us how it is possible to move out of poverty, especially when there are local opportunities available. But they also show us how easy and quick it is to become poor.”
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The research also debunks some myths and prejudices about the poor, whom many see as passive and without ambition or aspirations. In fact, when asked by researchers how one could move out of poverty, nearly all groups, including disabled people, emphasized individual effort, self-reliance and initiative
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“We find little evidence that poor people are poor because of laziness or disinterest in work and savings,” said the lead author of the study, Deepa Narayan. “Even in very poor and conflict-prone areas, poor people seldom seem apathetic. Instead they take initiatives often pursuing many small ventures simultaneously to survive and get ahead.”
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The study says that the focus of poverty reduction strategies must therefore shift to increasing economic, social and political opportunities in the local communities where the poor live. These local opportunities include the provision of business know-how, basic access to health and education and the improvement of local governance. Local governments that are responsive and accountable have a critical role in creating the local conditions for households to escape poverty.
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p>“Individual hard work and belief in self can take people far, but it cannot make up for lack of economic opportunity and blocked access to opportunity in the communities where poor people live,” said Narayan.
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| In addition, efforts must also be directed to preventing people from becoming poor in the first place when they sell off assets or become indebted because of illness, unemployment, natural disasters or more recently, the impact of the world financial crisis. New strategies are needed to increase their resilience through social and health insurance programs, as well as better access to credits, local markets and infrastructure projects. |
| Given the fact that countries can experience mass poverty – from one third of the population in India to more than 60 percent in Zambia—the study finds that although efforts to support self-help organizations of the poor may ease the pain of a few in the short run, “they are totally inadequate to lift entire nations or communities out of poverty.” |
Other highlights and recommendations of Moving out of Poverty include:
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Most poor people believe that markets work and want to do business on an equal and fair footing. |
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Most poor people value democracy, which they equate with the freedom to vote, to think, to speak, to move, to protest and to work. |
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Family is the most frequently mentioned institution that helps people accumulate assets. |
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Microcredit can help the poor subsist from day to day, but in order to lift them out of poverty, larger loans are needed so that the poor can expand their productive activities and thereby increase their assets. |
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Poverty reduction efforts need a “liberalization from below” that includes: |
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removing restrictive government regulations; |
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expanding access to markets, especially by providing connectivity through roads, bridges and telephones; and integrating poor people’s businesses on fairer terms in new business models. WB-110309 |
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NOTE: The government needs to concentrate on facilitating initiatives by the people and provide them opportunities as described above to enable people to rise above the poverty line. This could be agenda for poverty eradication by the Government
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KRSR/100110
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