1. The Nature of Inequality and Poverty
Ch.2, Greig, et. al.

2. The Nature of Inequality
In development the reduction of poverty or inequality?
What is to be done? Catch-up or redistribute?
Before modernity, inequality was considered normal or natural
With modernity (18th 19th cc) came the debate on inequality
Those who questioned the assumption that inequality is natural:
Struggled to achieve equal rights before the law and political participation

3. The Nature of Inequality
Equality of opportunity versus equality of outcomes
Opportunities perspective dealt with issues of how much to extend civil, social and economic rights
The outcomes perspective is more radical, but there are limits (the equality of what?)

4. The Nature of Inequality
Practitioners have found it easier to measure outcomes rather than opportunities
Meanwhile, multidimensional measures of inequality (longevity, access to education and health services) developed
However, intrahousehold inequalities are still ignored
We can point to gender inequality across the globe
Age discrimination
Class relations and inequality in poorer countries

5. The Nature of Poverty Narrow versus broad poverty
Narrow: inability to participate owing to a lack of resources
These are money-metric conceptualizations
Broad: Multidimensional (material and nonmaterial deprivations)

6. The Nature of Poverty Absolute versus relative poverty
Absolute: income does not meet minimum physical needs because of lack of income
But this is not readily generalizable (people are of different ages, states of health, etc.)
People are not livestock. Rather, human beings are social actors, poverty needs to be defined in relation to other people in society.

7. The Nature of Poverty
Relative: European countries, poverty line 60% of country’s median income (OECD)
Subjective approaches are increasingly popular
Objective definitions of poverty collected by researchers- subjective: respondents determine what poverty is.
‘Measurement’ camp versus structuralist camp
Du Toit (structuralist): by focusing on what is measurable, these dominant ‘measurement’ approaches neglect the analysis of culture, identity, agency and social structure that are central to poverty.

8. The Conceptualization of Poverty in Development Theory and Policy
In the period after the WWII, poverty was not a central issue for development. Other concerns-decolonization, national economic planning, agricultural modernization, industrialization held more attention.
By 1970s, development theory and policy began to look more closely at poverty.

9. The Conceptualization of Poverty in Development Theory and Policy
By 1970s World Bank shifted growth focus to include poverty reduction as part of economic growth strategy
While ILO introduced “basic needs” approach as part of service delivery strategy. ILO’s concept of poverty as a multidimensional set of deprivations challenged the neo-classical economists unidimensional conception. (income shortfall).
The concept of income poverty favours analyses that see economic growth as a solution to and market based strategies as the mechanism for poverty reduction.
In contrast, the basic needs approach favours analyses see service delivery (food, water, education, health) as the solution and state action as the main mechanism.

10. The Conceptualization of Poverty in Development Theory and Policy
1980s saw rise of neoliberal thinking, basic needs approach pushed off the agenda.
During the 80s, 2 theories emerged on poverty:
1- Forest, Greere, Thorbecke (FGT) measures of poverty incidence, depth See p.21
Incidence: an estimate of the people below the poverty line.
Depth: Average distance below the poverty line(shows average distance of the poor from the poverty line).

11. The Conceptualization of Poverty in Development Theory and Policy
2- Amartya Sen’s approach- development is about people being able to raise their capabilities so that they have greater freedom to achieve the ‘functionings’ they value.
Functionings: things people manage to do, e.g raising a family, living a long life. Hence people experience poverty when they are deprived in terms of a basic capability.

12. The Conceptualization of Poverty in Development Theory and Policy
The most readily identifiable foes of human development approach are those who focus on:
International poverty lines - $1 per day (extreme poverty) and $2 (poverty)
Goal 1/Target 1/Indicator 1 of the Millennium Development Goals was reducing extreme poverty by 50% between

13. Poverty and Inequality: What are the Interactions?
2 theoretical approaches
1- Behavior of individuals
2- Operations of social structures
World Bank’s World Development Report 2006 adopts structuralist view

14. Individualistic approaches
Individualist approaches
Neoliberal (rational choice): focus on individual agency and conceptualize social processes as the aggregation of the choices of individuals.
Inequality in economic terms (income and assets).
By assuming that there is equality of opportunity, they lead to the conclusion that inequality of outcomes shapes human behaviour in positive ways (i.e. those who are not getting good incomes will work harder)

15. From 16th cc onwards, ‘deserving’ versus ‘undeserving’ poor.
Deserving: unable to participate in economic activity because of factors beyond their control: disability, accident, elderly, orphans.
Undeserving: lazy, drunk, promiscious
Murray – ‘underclass’ phenomenon (self-inflicted) is perpetuated through ‘welfare dependence’.

16. Structural approaches
Structural perspectives:
Powerful groups impose preferences
Markets shaped by social structures
Unequal social relations
Structuralists argue that poverty and deprivation are not the result of a lack of resources but the maldistribution of resources.