Chapter 15: Poverty and Development
- What is poverty?
- How should 'development' be understood?
- What are the key trends in global poverty and inequality?
- Has globalization increased, or decreased, global poverty?
- How successful have official development policies been?
- Do international aid and debt relief work?
The issues of development and poverty reduction have become increasingly prominent since the end of WWII. In the early phase, this occurred as decolonization failed to bring about economic and social progress in what was then portrayed as the Third World, at the same time that industrially advanced western countries were experiencing historically unprecedented levels of economic growth. As global economic disparities widened, some argued that colonialism had given way to 'neocolonialism', political domination having been replaced by more subtle but no less effective economic domination. Others heralded the emergence of a 'Northâ€“South divide'. In this context, bodies as different as the World Bank and the IMF, on the one hand, and a host of development NGOs and activist groups on the other, came to view the task of reducing the gap between rich countries and poor countries as a moral imperative. However, poverty and development are complex and deeply controversial issues. Is poverty merely an economic phenomenon, a lack of money, or is it something broader and more profound? Does 'development' imply that poor societies should be remodelled on the basis of the rich societies of the so-called developed West? A further range of issues address the nature, extent and causes of global inequality. Is the world becoming a more, or less, equal place, and, in particular, what impact has globalization had on global patterns of poverty and inequality? Finally, there have been passionate debates about the surest way of bringing about development. These debates have focused in particular on the merits or otherwise of the market-orientated approaches to development that have dominated especially since the early 1980s. Have bodies such as the World Bank and the IMF failed the world's poor? Do rich countries have a moral obligation to help poor countries? If so, how should that obligation be discharged: by providing international aid, cancelling debt, changing trading practices or whatever?
- A distinction is commonly drawn between absolute poverty, founded on the idea of 'basic needs', and relative poverty, in which the poor are the 'less well off' rather than the 'needy'. However, narrowly income-based definitions of poverty have increasingly been viewed as limited or misleading, as greater attention is paid to the broader notion of human development.
- The 'orthodox' view of development takes economic growth to be its goal and understands modernization in terms of western-style industrialization. The 'alternative' view of development rejects such technocratic, top-down and pro-growth strategies, but it encompasses a wide range of views and approaches.
- Trends in global inequality are often highly complex and contradictory. It is widely believed that in recent decades the growing importance of emerging economies has had an equalizing impact, counter-balanced by deepening poverty in sub-Saharan Africa and a general trend towards greater within-country inequality.
- The impact of globalization on levels of poverty and inequality cannot be resolved through empirical trends alone. Some claim that globalization, like a rising tide, will eventually 'raise all boats', but others argue that globalization is based on structural disparities that inevitably benefit some countries and areas at the expense of others.
- Official development policies, particularly during the 1980s and 1990s, were based on structural adjustment programmes that sought to remove blocks to economic growth in the developing world. These proved to be highly controversial, sometimes resulting in deeper, not reduced, poverty, and have, in some respects, been modified in recent years.
- International aid is often viewed as the key mechanism of development. It is justified by a development ethic that suggests that rich countries have an obligation to support poor countries and reduce global inequality. Critics, nevertheless, have argued that aid provides ineffective support for the world's poor because it undermines markets and tends to promote corruption and oppression.