‘Poverty, Growth and Children: What’s the Right Sequence?’

Chapter 3 of Global Child Poverty and Well-Being: Measurements, concepts, policy and action (Minujin & Nandy, 2012)

Introduction:

More than 100 years ago, Henry George – a colourful economist who ran for mayor of New York and whose brainchild is the famous board-game ‘Monopoly’ – noted that ‘the association of poverty with progress is the great enigma of our times’ (George, 1882). And so it remains today. The recent stretch of globalisation has produced unprecedented prosperity and spectacular technological progress – not unlike that in the late 19th century. Yet too much of it has by-passed billions of people so that an unacceptable number of children continue to live in abject poverty.

Growth is but a means, never an end

The global discourse on human development considers economic growth as the prime force for reducing poverty. The lack of growth is invariably seen as the main cause of poverty. Most aspects of human development are seen as the result of economic growth. According to that outlook, almost everything is ‘growth-mediated’. Dreze and Sen (1989) distinguish between ‘growth-mediated’ and ‘supply-led’ development strategies. After examining the role of social services in human development, Anand and Ravallion (1993) conclude ‘that certain components of public spending can matter greatly in enhancing human development in poor countries, and that they matter quite independently of what they do or don’t deliver in terms of reduced income poverty’.

Others consider the growth-perspective as too narrow, even reductionist, because it ignores the historical background, the socio-political context, and the international dimension of human poverty. After a decade of rapid economic growth in India, for instance, it cannot be denied that an excessive proportion of Indian children continue to suffer from malnutrition. The usual response to such observations is that rapid growth has lifted hundreds of millions of people out of poverty in India, China and elsewhere. Yet that argument is based more on tautological reasoning than on real observation. By defining poverty in terms of income alone and by using $1/day as the universal yardstick, it is only normal to find a near-perfect correlation between growth and poverty. Unfortunately, that correlation is by and large a fiction of the mind.

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