Poverty in Africa and elsewhere

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Poor people are poor because markets fail them and governments fail them.  That markets fail them is well-known.  Failures in capital markets mean that young people cannot get loans to finance their education; imperfect or nonexistent insurance markets mean that poor people will not get decent health care if left to unfettered markets; economies of scale as well as the simple fact that basic services such as water are necessities mean that markets will not ensure that poor people will get the services they need to survive.  As Roy Radner, a former professor of mine once put it, “When you allocate resources by market prices, you discriminate against poor people.”

To overcome these failures—that is, to protect the poor—governments step in.  They finance and provide primary education and basic health care; they subsidize water and electricity so poor people can afford these services.  Unfortunately, these well-intentioned government interventions lead to failures of their own.  In Ugandan public schools, teachers are absent 27 percent of the time; health workers in primary health centers are absent 37 percent of the time.  Only one percent of the money allocated to non-salary spending in Chad reached the health clinics.  These “government failures” are sometimes as pernicious as the market failures they were intended to correct.  They are also difficult to overcome because various interest groups who benefit from the status quo may resist reform. 

One way to overcome them may be to create a debate around these failures, to amplify the voices of the poor, so that political leaders will listen to them. Today is Blog Action Day 2008, and the topic that bloggers worldwide are writing about is “Poverty.”  Let us hope this global movement, that is based on information-sharing, debate and discussion, will eventually help overcome both market and government failures so that poor people around the world can escape poverty. 

 

Authors

Shanta Devarajan

Senior Director, DEC and Acting World Bank Group Chief Economist

Join the Conversation

Anonymous
October 15, 2008

Rural communities that have sustained themselves for millennia on their land, now they are being measured with global development indicators hence they are failing, undeveloped and in western terms, poor. The infrastructure to help them develop socially and economically in line with how they are being measured has not been put in place. The Millennium Development Goals have very aggressive targets and indicators.

With the lack of infrastructure, these goals would not be achieved. Why don't we just look at how these communities have survived and help them be better at whatever it is they are doing? It is obvious that global development is a Eurocentric concept and would not address the development challenges of the African nations.

Thomas M.
October 17, 2008
Hassane Moussa Alkerou
October 24, 2008

Poverty in Niger is very recurrent and it has to faces,first rural and second urban.I would like to remain you that only development aid can't reduce poverty in Africa in general anr in Niger in particular because of lack of the implication of the poor in this process.So think about this....

Austino
March 25, 2009

The current situation in Chad is indeed appalling. Poor people are dying from diseases due to lack of prevention and treatment. I have left my feedback about this after reading this post here http://africacan.worldbank.org/les-d%C3%A9penses-publiques-perdues-au-t…
. Indeed, the overall effort needed to rise a wave of public discussion of issues and to ensure that politics and government people have started to pay attention to this.

grunt
May 14, 2009

The attention of global organizations such as World Bank and UN focused on the African continent is quite intent. Some western political leaders often call for a return to the practice of soft-colonialism: because there is a wide diffused view that any budgetary funds granted to the authorities of African countries, will be immediately stolen. In any case poverty cannot be overcome if not to include centers of poverty in a global network of international trade. And this is very difficult when the various African regions are geographically too distant from the ports.

Mike
May 23, 2009

Thanks Thomas for your comment, I hope that the problems in Africa will be solved.

Emmanuel Ogunleye
June 11, 2009

There is a need to advance the socioeconomic security of Africans through a compassionate and vigilant leadership. The African Governments must immediately implement a workable model of Social Policy Programs in Africa that will combine efforts, reduce duplicity, and adequately serve both the people and governmental needs. This is most pertinent now that world attention is on Poverty Eradication by way of Poverty Reduction Strategy Papers (PRSPs) as a part of the Millennium Development Goals (MDGs). In essence, we can mitigate poverty by categorizing them into defined sectors and I propose that we start with our disabled.

There are known methods and strategies used by developed Nation that we need to employ in managing time, resources, and recourse to the advantage of Africa. Africa has what the world needs and the world has what Africa needs. It is time for African to plan its future and request assistance from the world; not the reverse.

Morandi
June 17, 2009

Well, this is a good move. There are 14,053 blog posts on BlogAction 2008. 13 million people should have read the posts overall, I wonder if there was any Governments reactions since October the 15th. I wish there was every year's Blogaction raising the topic of poverty for everyone reading in order to initiate social movement.

Brian
June 30, 2009

Hope that country and all Africa will develop fast to become a power continent in the near future.

Atita
June 30, 2009

I read this article. I think about my birth place, Thailand. Thailand has some problem like this article. Poor people cannot get loans for their education.

I hope this problem that been solve some day.

Higherluv
July 07, 2009

Not sure if it will be a power continent in the future. Loss of direction and faith is the primary reason for many African countries failures. If the people and especially the gov't don't correct themselves, these problems will continue no matter what. Awareness AND aid is the key

BeeReg
July 08, 2009

Poor and do not have enough money to have a better education make them poorer and they can not help their country develop, a nightmare circle.

Ulysse Nardin
July 08, 2009

Loss of direction and faith is the primary reason for many African countries failures.

Tamasong
July 17, 2009

These countries are very difficult to develop because they do not have any nature resources, the only resource is people but people is not well educated, how to change? No one know now.

Alvin
July 17, 2009

It is always sad to see the environs on those poverty stricken areas especially in the African continent. Whenever I see on television photos or footage of malnourished children and babies from affected regions, it saddens me more. I hope the whole world would exert some massive efforts to come up with highly viable solutions in order to end poverty situations.

Robert Smith
July 18, 2009

I think the reason for poverty is the way parents don't raise their child with good financial values. The government is not to blame. The government however, is to blame for poverty of the whole country. Take US for instance, they should bring back labor jobs from companies who outsource to foreign countries.

Jessica
July 18, 2009

I think governments should instill good financial values into our children. Its the only way to learn(when your young that is).

Bachelors degree
July 27, 2009

They are also difficult to overcome because various interest groups who benefit from the status quo may resist reform.

A1Article
August 01, 2009

Very difficult if they stand alone but if all developed countries help them they will overcome very easy.

Honest Riches
August 02, 2009

This has been a long standing problem whose solutions are long shot. There are just so many strong factions in the African continent.

Hoodia Gordonii
August 02, 2009

Africa's economic malaise is self-perpetuating, as it engenders more of the disease, warfare, misgovernment, and corruption that created it in the first place. Other effects of poverty have similar consequences. The most direct consequence of low GDP is Africa's low standard of living and quality of life. Except for a wealthy elite and the more prosperous peoples of South Africa and the Maghreb, Africans have very few consumer goods. Quality of life does not correlate exactly with a nation's wealth. Angola, for instance, reaps large sums annually from its diamond mines, but after years of civil war, conditions there remain poor. Radios, televisions, and automobiles are rare luxuries. Most Africans are on the far side of the digital divide and are cut off from communications technology and the Internet. Quality of life and human development are also low. African nations dominate the lower reaches of the UN Human Development Index. Infant mortality is high, while life expectancy, literacy, and education are all low. The UN also lowers the ranking of African states because the continent sees greater inequality than any other region. The best educated often choose to leave the continent for the West or the Persian Gulf to seek a better life; in the case of some nations like South Africa, many caucasians have fled due to employment bias.

Catastrophes cause deadly periods of great shortages. The most damaging are the famines that have regularly hit the continent, especially the Horn of Africa. These have been caused by disruptions due to warfare, years of drought, and plagues of locusts.

An average African faced annual inflation of over 60% from 1990 until 2002 in those few countries that account for inflation. At the high end, Angola and the Democratic Republic of the Congo both saw triple-digit inflation throughout the period. Most African states saw inflation of approximately 10% per year.

There are incomplete numbers for unemployment in most African nations, but it is an important problem. Major cities like Lagos and Kinshasa have large slums of the unemployed and underemployed.

----
Pioneer pro-111fd
Hoodia Gordonii

how to jump higher
August 12, 2009

I think a few smart millionaires could do a lot for poverty.

Online Masters Degree Science
September 02, 2009

Why Africa keeps lagging behind in a time where some Asian countries in the same economic position 40 years ago have progressed while we stood still. Yes African has to heal itself and by itself alone.

Anonymous
October 15, 2009

I totally agree they need to pull there self together (: and become a good country for everyone

Cigarette Holder
October 31, 2009

The poverty in Africa is a real shame, especially in today's world. At the end of the day it is the fault of the African government for being too afraid to take any real action to solve the problem.

Cold Relief
November 02, 2009

There are many good thoughts on poverty in Africa and how to fix it. But what good does it do to just think about rather than actually do something about it?

digital entertainment
November 03, 2009

Why Africa keeps lagging behind in a time where some Asian countries in the same economic position 40 years ago have progressed a lot? Where have all the efforts gone?

How To Jump Higher
November 22, 2009

In Africa, you will find dozens of little children playing with one another in the dust. Looking over them in the shade will be the grandmothers or other elders, ready to intervene when things get out of hand. If a child is hurt in the squabbles that inevitably arise, they run to soothing arms of their grandmothers. However AIDS, famine, and war have brought to Africa an entirely new concept, children with no family members, no blood relatives, no extended family members. No elders to care for them, they are lost and forgotten in a cruel world, and no one seems to care.

Anonymous
October 25, 2009

Niger is one of the richestest country in Africa. a country with only 14 million people and all kinds of natural resources from uranium, charco,gold, petrolium, and many others. a well management of these resources is enought to provide good infrastructres, education, health, and inproving their agriculture sectors.
Africain should stop pointing fingers and stop counting on exterior aid, they should star taking advantage of a changing world.for exemple in a nation like niger, why they can't lease all the heavy equipment needed to the exploitation of their own natural resources? after all they had invested billions to provide education in the mining sectors.

Wealthy Affiliate
December 30, 2009

Its only after reading such carefully thought out and planned articles that one realises how fortunate we are here in the West. We have clean water to drink, healthy food to eat, fresh air to breath, manier times we take all this for granted. Articles like these bring us back to the ground and force us to be grateful for what we have.

How To Increase Vertical
January 18, 2010

You know... I've gotta be honest.

When I read your first paragraph, I thought I was going to be irate and want to rip your head off, but I think, if I understand you correctly, that you have a valid point.

Often our government tries so hard to protect and help the poor people, that they just make the problem worse.

I'm continually in a debate with myself as to how much the government should in fact help the poor and those less fortunate.

Shanta
January 18, 2010

Thank you for your comment, and for not ripping my head off. Indeed, the problem is that, despite the best of intentions, governments sometimes end up hurting the poor. The reason is that incentives within government are not always geared towards performance. So a public school teacher gets paid whether or not he shows up for work; the result is a teacher absenteeism rate of 25 percent. Another reason is that certain policies get captured by the elite, who are sufficiently powerful politically to block their reform--even though reforms would benefit the poor.

The real question is not "how much the government should help the poor," but how we can help the government help the poor. This is where a public debate, including in blogs like this, comes in. By bringing the evidence on unproductive government interventions into the open, I hope we can create some consensus for reforms that governments will listen to.

Josh
January 19, 2010

Nicely presented article I must agree. The problems in Africa will one day be solved.

How To Jump Higher
January 20, 2010

It is not the failure of the government to provide for the poor. When we rely on the "government" to do it, it becomes too easy for us to just turn away and ignore the situation. We let the government "provide for the poor" and we go about our daily lives.

We, as individuals, should take on more of the responsibility and quit trying to designate the "government" in our place as a means of relieving ourselves from what should be done.

How To Fall Asleep
January 20, 2010

We can be spending money much more intelligently than our current allocation strategy. With all of the corruption in the African nations, it is hard to make sure our money is put into the right hands though.

Robert Frank
February 04, 2010

In any case poverty cannot be overcome if not to include centers of poverty in a global network of international trade. Whenever I see on television photos or footage of malnourished children and babies from affected regions, it saddens me more. I hope this problem that been solve some day.
Robert Frank, http://pdflost.com

Tom
March 17, 2010

I feel for all the poor and underfed people, but what I can't understand is how the governments that rule these poor continue to steal from them, diverting aid and food and then reselling it and pocketing the money. How long is the rest of the world going to tolerate this behavior?

Patrick Mwendwa
March 21, 2010

I think Africans should come to the understanding that there is no such thing as a free lunch. Instead, a price-tag is often attached and needs to be paid in full. Our leaders need to cultivate a sense of committment within the society and show that it is the only way to "pitch-in" towards paying the price.

It is only after becoming committed towards a common goal that Africa can start moving forward and its people begin to reap the fruits of their labor.

African Native

Anonymous
April 02, 2010

It is the application of Technology,Technological skills,know how and wisdom and Intelligence of all African great minds to Identify what solutions are required to create Rural based employment .If you read the most dynamic and fact file by the world bank on Pan African Highways wps4097 you would appreciate a true African perspective of poverty eradication.The benefits are so wide for each Nation and promote regional Intergration.The choice is us Africans to be proactive in economic decision making at grassroots level and start by education which reflects the future economic brains and leadership whose curricular is inline with the development of a Nation.Technology has to be upgraded and the way Industry and Infrastructural development in Government departments has to identify suitable equipment which creates employment in Rural Areas and allow communities to develope by themselves.

Anonymous
April 02, 2010

If we realise all the socioeconomic solutions for Africa lie in the very choices we make at grassroots level due to remote areas out of touch with development and media and civilisation.A simple example is there is no reason why people in Rural Areas should have a Headman to manage their Infrastructural development when he has no tertiary education and understanding of the required needs of Infrastructure.The time has come to take Africa to the next 21st century and qualify to be a super power with the talent and skills education has developed.Local District councilors in Rural areas should be elected on Qualifications and ability to participate in the Economic development of their districts not by choice of chieftainship or ancestral spirits but capability issues like profession and technological skills to develop the district are more crucial than being partisan in culture.A civil Engineer would identify what needs to be done and will question the district council decisions and contribute to well being of community in economic development than a cultural councillor with no clue of concrete or water pumping station,power generation, road culverts,building construction.If all levels of community leaders are upgraded to these qualifications then better judgement and decision making standards will rise and disctricts will benefit.

piese auto online
April 16, 2010

I know poverty because poverty was there before I was born and it has become part of life like the blood through my veins. Poverty is not going empty for a single day and getting something to eat the next day. Poverty is going empty with no hope for the future. Poverty is getting nobody to feel your pain and poverty is when your dreams go in vain because nobody is there to help you. Poverty is watching your mothers, fathers, brothers and sisters die in pain and in sorrow just because they couldn't get something to eat. Poverty is hearing your grandmothers and grandfathers cry out to death to come take them because they are tired of this world. Poverty is watching your own children and grandchildren die in your arms but there is nothing you can do. Poverty is watching your children and grandchildren share tears in their deepest sleep. Poverty is suffering from HIV/AIDS and dying a shameful death but nobody seems to care". " Poverty is when you hide your face and wish nobody could see you just because you feel less than a human being. Poverty is when you dream of bread and fish you never see in the day light. Poverty is when people accuse you and prosecute you for no fault of yours but who is there to say some for you? Poverty is when the hopes of your fathers and grandfathers just vanish within a blink of an eye. I know poverty and I know poverty just like I know my father's name. Poverty never sleeps. Poverty works all day and night. Poverty never takes a holiday

kira
April 16, 2010

I disagree, if you decided to cut the government's contributions and just rely on ourselves, we'd probably see a drastic decrease in aid going to those countries. Instead, we should be discussing how to improve how the government intervenes in these countries.

Kira

Bernard
May 10, 2010

I find your posting very interesting. Can you give me the reference to "Pan African Highways wps4097"? I would like to read it.
Do you live in Africa? In Nigeria? I would like to get some on-the-spot information about education there.

Jimmy
May 04, 2010

COMMUNISM IS THE SOLUTION. Communism will lead to an equal society

Berio
May 12, 2010

Its only after reading such carefully thought out and planned articles that one realises how fortunate we are here in the West. We have clean water to drink, healthy food to eat, fresh air to breath, manier times we take all this for granted. Articles like these bring us back to the ground and force us to be grateful for what we have.

Michael
May 28, 2010

With the lack of infrastructure, these goals would not be achieved. Why don't we just look at how these communities have survived and help them be better at whatever it is they are doing? It is obvious that global development is a Eurocentric concept and would not address the development challenges of the African nations.

Anonymous
September 29, 2010

Change here needs to start with African leadership. Exploiting human and natural resources is rooted in Africa’s history. Without changing this pattern of behavior, the newfound economic investments in the past decade will not aid the people that really need it. Sanou Mbaye explores this idea: “Africa faces a crisis of leadership and governance, owing to a dysfunctional ethos. If Africans want to change this, they cannot spare themselves a collective debate about their elites’ complicity in widespread impoverishment.” I found this article very interesting. Check it out here: http://www.project-syndicate.org/commentary/mbaye13/English

Shalini Sinha
September 16, 2010

The few millionaires you are referring to are a base to start off off with. Have been working for over a year here in Mauritius along the same lines. Can go far with some determined leadership, concise thinking and right implementors. Have worked in Africa also- and the continent is not short of any of these type of people I am referring to. In fact, they know how to fine tune it to the local context.

jump higher
October 15, 2010

You can't help Africans unless you know what they suffer.

Dave H
November 20, 2010

Poverty in Africa // economic growth, natural resources, educated leadership, diverse leadership// africa's problems is due to policies and lack of interafrican state development or regional coordinated development// all the African states need a constitutional charter // a university must be created and funded by African states and the international community that will address the technical, environmental, government , economic, and cultural issues in the development of Africa. Education from primary to university is key to Africa's modernization.