Wednesday, February 24, 2010

Is Poverty the cause of illiteracy?

Is Poverty the Cause of Illiteracy?


In a previous post we had discussed whether illiteracy was the cause of poverty. A number of readers have enquired whether poverty can be the cause of illiteracy. We explore the argument in this post.

At one level the proposition can come across as valid. The poor would not have the income to afford education for their children and would, by necessity, keep the latter out of school. The very poor would need to supplement the household income with the earnings of children giving rise to the prevalence of child labor. The very, very poor would not even have enough to afford the upkeep of their children and be forced to give them up to madrassas providing free care.

This line of thinking would lead one to conclude that countries with widespread poverty would have widespread illiteracy.

How then would one account for the very wide variation in literacy rates across groups that suffered from more or less similar levels of poverty at one time? If readers look up the data they would note that Sri Lanka and Pakistan must have had similar per capita incomes at some point in the past. Yet today Sri Lanka has over 90 percent literacy compared to just about 50 percent in Pakistan.

In India, Kerala has the highest literacy rate while being nowhere close to the richest among the states. So it is clearly not poverty alone that holds back literacy.

The flaw in relating illiteracy to poverty is that there is no overriding necessity for primary education to be available on a fee-for-service basis. Why should parents have to pay for the basic education of their children? Why shouldn’t parents be paid to have their children educated?

Two arguments can be made for this point of view. First, literacy is a fundamental human right and it should be the obligation of the state to make it available on a priority basis out of general revenues. Second, it has long been known that social returns to basic education are very high (i.e., the gains to society from educating its population far exceed the costs of the education because of the increased productivity of labor). Therefore rational societies should invest public resources in educating their citizens.

So the question is why did some societies (East Asian countries, for example) do so and others still don’t?

We can think of an interesting case that can provoke a lot of thinking. Balochistan is the most lightly populated province in Pakistan with about 10 million people. Of these only about half are ethnic Balochis. It is well known that some Balochi tribal chiefs have had an income in the millions of dollars as payment for the use of natural resources extracted from their lands. The question is why have these tribal chiefs not used this income to provide basic education to their followers?

We will let readers answer this question. But one conclusion should be obvious – there is more to illiteracy than just poverty or lack of resources or lack of political will. Surely it should be clear that some societies have an incentive to educate their citizens and others don’t.

The real clues to the continued prevalence of illiteracy would be found in thinking through the incentives. The low political priority to educate citizens in some places is a story waiting to be told.

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Is illiteracy the cause of poverty?

For Causes of Poverty, click here

Is Illiteracy the Cause of Poverty?

Is Illiteracy the Cause of Poverty?


It is often argued that illiteracy is the biggest problem in South Asia and also that illiteracy is the reason for poverty. What is the evidence for such assertions?

Let us start with a couple of concrete examples:

Over the past fifteen years, the proportion of the population living under extreme poverty in Pakistan has risen from 13 to 33 percent but illiteracy has declined during this period. Therefore, the explanation for the increase in poverty in Pakistan cannot be attributed to illiteracy.

India has a considerably higher literacy rate than Pakistan but the incidence of poverty in India was comparable to that in Pakistan for many years. The recent trend in poverty reduction in India cannot be attributed to a sudden increase in literacy.

This is not to argue that illiteracy does not matter. Clearly a literate work force can be much more productive than an illiterate one everything else remaining the same. And literacy can contribute positively to the quality of life of an individual for which reason it is considered a basic human right. But the fact remains that there is not sufficient evidence to establish that illiteracy is the most basic reason for poverty.

Similarly, there is also no obvious link between poverty and the lack of democracy and human rights. The most dramatic reductions in poverty have been in East Asian countries under non-democratic governments much criticized for their human rights records. By comparison, poverty reduction in democratic India has been much slower. Once again, this is not an argument for authoritarian governance; there are many other unrelated benefits of democracy. The point is that there seems no direct link between the lack of democracy and the incidence of poverty.

A closer look at the evidence might suggest that the causes of poverty have less to do with literacy or democracy and much more to do with economic and political policies.

The evidence of the impact of economic policies on poverty reduction is quite impressive. East Asia is a well documented example where the number of people living on less than one dollar a day has fallen almost two-thirds, from 720 million in 1975 to 210 million in 2002 almost entirely because of the rapidity of economic growth. India has also begun moving in the right direction after key economic reforms have relaxed the stifling grip of the ‘license Raj.’

On the other side are countries like Pakistan where ruling groups allocate the bulk of national resources to defense, foreign policy adventures, fomenting domestic strife to manipulate political power or in stifling business to protect vested interests. It is not surprising that foreign and domestic investors are reluctant to invest in such countries. Without investment, there is little job growth; and without job growth little prospect of reduction in poverty.

The political and economic choices of such ruling groups are not directly influenced or constrained by the illiteracy of their populations. Policies, good or bad, are all decided by people who are quite literate. What we need to explain is why some literate ruling groups make consistently bad political and economic decisions. One such decision is not investing in raising the literacy levels of their populations. Why did Sri Lanka and China invest in raising their literacy levels to over 90 percent while Pakistan and Bangladesh remain at around 40 percent? Why is the rural education program in India so weak compared to its urban program?

What we really need to explain is the persistence of illiteracy in some countries or parts of some countries. And this has to do with the interests, choices and decisions of the literate sections of these countries.

When analysts begin to explain the political economy of continued impoverishment, when people understand the real causes of their poverty, and when political parties mobilize them on the basis of this understanding, perhaps then there will be hope for change in countries that have shortchanged their citizens by keeping them poor and illiterate.

Is Poverty the cause of illiteracÿ? CLick here
Causes of Poverty CLick here

Monday, February 22, 2010

Causes of Poverty

I. Types of causes of poverty
A. Individual

Poverty is explained by individual circumstances and/or characterstics of poor people. Some examples are:

* amount of education, skill, experience, intelligence.
* health, handicaps, age.
* work orientation, time horizon, culture of poverty.
* discrimination, together with race, sex, etc.

B. Aggregate

There are two types of aggregate poverty theory: case and generic. There is no agreement on which is the correct explanation of most poverty.

1. Case. Add up all poverty explained by individual theories, and that is equal to total or aggregate poverty. In other words, according to case theories of poverty, individual and aggregate explanations are really the same. According to these theories, aggregate poverty is just the sum of individual poverty.

2. Generic. Poverty is explained by general, economy-wide problems, such as

* inadequate non-poverty employment opportunities
* inadequate overall demand (macro problems, macro policy)
* low national income (Less Developed Country)

If generic theories are correct, poverty is caused by one set of forces (general, economy-wide problems) but distributed according to individual theories.
II. Case vs. Generic Theories of Poverty

A. What difference does it make whether poverty is caused by case or generic causes?

Answer: It makes a lot of difference.
Example #1: Suppose somehow we significantly reduce racial discrimination. Will total poverty fall?

Case answer: Yes.

Generic answer: No. Poverty will only be redistributed.
Example #2: Suppose we give poor people effective skill training and compensatory education. Will total poverty fall?

Case answer: Yes.

Generic answer: No. Poverty will only be redistributed.
B. What can you do about poverty?

1. If case theories are correct: Address the individual cause of poverty. For example, if poverty is caused by inadequate skills or education, then the solution is skill training or compensatory education. If poverty is caused by discrimination, then the solution is antidiscrimination policies.

2. If generic theories are correct: Improve the quantity and quality of jobs.
C. How can you tell which is correct--case or generic theories?

1. Remember that the things that cause poverty in case theories explain its distribution in generic theories. Because of this, both theories are consistent with the same facts (statistics). Therefore, it is very difficult, maybe impossible, to determine which is correct through direct test.

2. There's some indirect evidence pointing to generic theories: For example, there is the failure of poverty to fall during periods of large training programs, and the failure of poverty to fall with rise in general educational level of population. Further indirect evidence later on in the course.

3. Most people assume case theories are correct. Why?

* Micro experience (fallacy of composition -- assuming that what's true of the part must be true of the whole).
* Poverty scholars study the poor instead of the economy.
* Antipoverty policy would be too hard (expensive) if generic theories were true.
* Blaming the victim.
* A desire to help the poor. (P.S. If generic theories are true, how can you help the poor?)

Source: Maxwell School, Syracuse University

Acute causes of poverty:

* Warfare: The material and human destruction caused by warfare is a major development problem. For example, from 1990 to 1993, the period encompassing Desert Storm, per capita GDP in Iraq fell from $3500 to $761. The drop in average income, while a striking representation of the drop in the well-being of the average Iraqi citizen in the aftermath of the war, fails to capture the broader affects of damages to the infrastructure and social services, such as health care and access to clean water.

* Agricultural Cycles: People who rely on fruits and vegetables that they produce for household food consumption (subsistence farmers) often go through cycles of relative abundance and scarcity. For many families that rely on subsistence production for survival, the period immediately prior to harvest is a 'hungry period.' During these periods of scarcity, many families lack sufficient resources to meet their minimal nutritional needs. Being familiar with these cycles has enabled development practitioners to anticipate and prepare for periods of acute need for assistance.

* Droughts and Flooding: Besides the immediate destruction caused by natural events such as hurricanes, environmental forces often cause acute periods of crisis by destroying crops and animals.

* Natural Disasters: Natural disasters such as hurricanes and earthquakes have devastated communities throughout the world. Developing countries often suffer much more extensive and acute crises at the hands of natural disasters, because limited resources inhibit the construction of adequate housing, infrastructure, and mechanisms for responding to crises.

Entrenched factors associated with poverty:

* Colonial Histories: One of the most important barriers to development in poor countries is lack of uniform, basic infrastructure, such as roads and means of communication. Some development scholars have identified colonial history as an important contributor to the current situation. In most countries with a history of colonization, the colonizers developed local economies to facilitate the expropriation of resources for their own economic growth and development.

* Centralization of Power: In many developing countries, political power is disproportionately centralized. Instead of having a network of political representatives distributed equally throughout society, in centralized systems of governance one major party, politician, or region is responsible for decision-making throughout the country. This often causes development problems. For example, in these situations politicians make decisions about places that they are unfamiliar with, lacking sufficient knowledge about the context to design effective and appropriate policies and programs.

* Corruption: Corruption often accompanies centralization of power, when leaders are not accountable to those they serve. Most directly, corruption inhibits development when leaders help themselves to money that would otherwise be used for development projects. In other cases, leaders reward political support by providing services to their followers.

* Warfare: Warfare contributes to more entrenched poverty by diverting scarce resources from fighting poverty to maintaining a military. Take, for example, the cases of Ethiopia and Eritrea. The most recent conflict over borders between the two countries erupted into war during 1999 and 2000, a period when both countries faced severe food shortages due to drought.

* Environmental degradation: Awareness and concern about environmental degradation have grown around the world over the last few decades, and are currently shared by people of different nations, cultures, religions, and social classes. However, the negative impacts of environmental degradation are disproportionately felt by the poor. Throughout the developing world, the poor often rely on natural resources to meet their basic needs through agricultural production and gathering resources essential for household maintenance, such as water, firewood, and wild plants for consumption and medicine. Thus, the depletion and contamination of water sources directly threaten the livelihoods of those who depend on them.

* Social Inequality: One of the more entrenched sources of poverty throughout the world is social inequality that stems from cultural ideas about the relative worth of different genders, races, ethnic groups, and social classes. Ascribed inequality works by placing individuals in different social categories at birth, often based on religious, ethnic, or 'racial' characteristics. In South African history, apartheid laws defined a binary caste system that assigned different rights (or lack thereof) and social spaces to Whites and Blacks, using skin color to automatically determine the opportunities available to individuals in each group.

Source: MSU Women and International Development

Addressing the Underlying Causes of Poverty

Building a more widespread commitment to overcoming poverty is an essential first step in overcoming poverty, and actions to address this are discussed below.

* Share the benefits of economic growth through an emphasis on more widespread employment.
The phenomenon of jobless economic growth that increases income inequalities and generates too few jobs for low income groups poses a serious threat to the well-being of many nations, both North and South. Government policies should consider not only aggregate economic impact but also the distribution of employment. Socially responsible venture capital and microcredit initiatives can foster employment-generating businesses that complement the local culture and environment.

* Rout out corruption, which harms society as a whole.
Corruption, both in government and business, places heavy cost on society. Businesses should enact, publicize and follow codes of conduct banning corruption on the part of their staff and directors. Citizens must demand greater transparency on the part of both government and the corporate sector and create reform movements where needed.

* Broaden access to education and technology among marginalized groups, and especially among girls and women.
The educational attainment of women has strong bearing on the well-being of their families, and efforts to improve education for women and girls must be strengthened. At the same time, steps should be taken to ensure that the current revolution in information technology benefits marginalized groups. This must begin in school.

* Improve government capacity to provide universal access to essential goods and services, including potable water, affordable food, primary health care, education, housing and other social services.
Governments around the world have made commitments to this through the 20/20 Initiative, which calls for 20% of national budgets and 20% of foreign aid to be spent on human services. But raising adequate resources through effective taxation and other mechanisms is often politically difficult. New mechanisms for public policy dialogue that enable citizens of all classes to recognize the benefit of universal access to key services must be put in place. Nonprofit groups and even corporations can provide essential support here, helping articulate a vision of a healthy society. These nongovernmental actors can also help in the actual provision of services.

Source: Synergos - University for a Night

# Additional Resources: Global Issues
# World Bank: PovertyNet
# UNDP: Poverty Reduction

Do you have any suggestions for resources or supplemental text for the above? Suggestions are welcome! Send an email to Hari Srinivas at: hsrinivas@gdrc.org

Do you have any comments to make?
Please include them in the form available below.

* "Should we instead be asking 'What causes wealth??' What is it that pulls people out of poverty? How can opportunities be created for low-income people to improve their condition? What will motivate them? No easy answers ... "
- Dr. Tony Walsh, USA

* "Have you considered the theories of the causes of poverty from the perspective that the causes of poverty are layered into international, national, national- local, and individual levels? The interactions between the economic, social, informational, cultural and political factors at the international, national, national-local and individual layer have to provide the job, so that the interactions between the economic, social, informational, cultural and political factors at the national, national-local and individual layer can provide a suitably equipped individual to take advantage of the job. (international layer would also be included if for example international NGOs, UN, etc... got involved with the country).
* At each level of abstraction, either individual, national-local, national, or international, there are a range of factors that interact within and between the levels of abstraction that influence the creation of correctly skilled individuals, the creation of opportunities for those individuals to exploit, the creation of the means for those correctly skilled individuals to exploit the wealth generating oppurtunites, and lastly the desire to do so. Therefore we see four important metrics generated by the interplay of factors within and between the different levels of abstraction, with no single metric being determined by anyone single level of abstraction; these are: Skills, Opportunity, Means, and Desire.


If you have any comments on this document, please send an email to - Dr. Gabriel KEN
kengadaffi@yahoo.com