How We Can Stop Ultra Poverty in Asia and The Pacific
The BRAC organization in Bangladesh has proven that there that there is an effective way to help the ultra poor. We need to find ways to use it more often.
A completely different way of thinking about how to address chronic and severe poverty has emerged. And this idea works. The evidence is preliminary but it is quite strong, and there is more coming very soon.
The ultra poor are the households who never have enough to eat. They survive through a patchwork of low paying unreliable jobs and have little or no assets of any kind. The ultra poor are hard to reach and statistically invisible. They experience fear, despair, and isolation every day. They have little to no social capital or power; and have no opportunities to escape their situation. In Asia and the Pacific, there are about 564 million people who are hungry. Under-nutrition contributes to the deaths of five million children under the age of five every year.
The ultra poor are the households who never have enough to eat. They survive through a patchwork of low paying unreliable jobs and have little or no assets of any kind.
For you and I, getting sick is a problem. For the ultra poor, illness is a life-threatening emergency for the entire family.
BRAC is a large and influential non-government organization founded in Bangladesh in 1972 to provide relief services. Throughout the 1990s they developed and tested a bundle of services to help the ultra poor escape their conditions within a 36-month period.
The program includes effective targeting of the poorest households, consumption support in cash or food, training and cash to start work or a micro enterprise, and a small savings system to help manage risk. Graduation out of extreme poverty is targeted in 18-36 months.
Consultative Group to Assist the Poor (CGAP) and the Ford Foundation in 2006 decided to replicate the model in eight countries with ten organizations. The replications involved 200 to 2000 persons and in some cases they were women and in others they were families. The program involved significant and careful field monitoring by program staff, qualitative research in the field, and randomized control trials to prove causality in all locations.
And what happened?
- First, households are much better off financially; this is demonstrated by improved household assets, savings, and values of assets increasing by 12-100% over the baseline. Most households switch from occasional wage labor to self-employment.
- Second, households are better off in terms of socio-cultural conditions. There were important improvements in school attendance of children (from 7-83% in one location), significant drops in infant mortality, increased use of health clinics (from 14-46% in one location), improved caloric intake of 35-50% or more (and quality of intake, in the forms of proteins) and 2/3 less child stunting. The impacts affect the next generation.
- Third and crucially, there was significant evidence of greater confidence, autonomy, and optimism for the future, and lower levels of stress and depression for participants than target groups. These results persisted a year after one program closed.
- In the one location where there were no discernable effects, the presence of a new, stronger government benefits program in the same area demonstrated the need to ensure need and consistency of approaches on a given site.
Dean Karlan, one of the gurus of impact evaluation, says about the ultra poor program that:
“The benefits we’re seeing in the lives of the poorest are big and important. The results are strong evidence that the Graduation Model can work”.
Esther Duflos, an eminent economist at MIT/Harvard and one of the leading researchers worldwide on poverty, says: "These are very, very good, results. [...] I don't think you could have ever expected anything better."
The proof is here. Now it is our chance to use what we have discovered here to improve the lives of those who need it most.