Poverty comes in different degrees. As Tina Rosenberg points out in the Opinion Pages of the New York Times: “There’s poor, and then there’s ultrapoor. The ultrapoor are almost always women and largely found in Africa, South Asia and to a lesser extent, parts of Latin America. They are most often rural. They work as maids or field laborers, often paid not with wages but in food scraps. They might have just one dress or sari, and must wash a part of it at a time while wearing it, or stay in the river for modesty till it dries.” Tina Rosenberg adds that the difference between poor and ultrapoor isn’t just one of degree. Being ultrapoor has an extra component: it is a trap so deep, people can’t take advantage of ways to improve their lives.
However, there is hope — results from a new study published in the scientific journal Science show the success of an anti-poverty program that targets the “ultrapoor”, a category often overlooked by economic development interventions. The study included more than 20,000 people enrolled across six countries (Ethiopia, Ghana, Honduras, India, Pakistan, and Peru) over a three-year period, and aimed to determine whether or not helping the ultrapoor — simultaneously and in multiple ways — could be especially effective in fighting poverty. Specifically, the study focused on the establishment of sustainable self-employment activities, and the subsequent generation of lasting improvements in the well-being of the ultrapoor.
The program, based on the graduation approach — an integrated, five-step methodology aimed at transitioning extremely poor populations into sustainable livelihoods — provides the poorest members in a village with a productive asset grant, training and support, life skills coaching, temporary cash consumption support, and typically access to savings accounts and health information or services. In each country, the program was adjusted to suit different contexts and cultures, while staying true to the same overall principles.
The study results show that the program — aptly called “graduation program” as it graduates the ultrapoor from poverty — produced a 5 percent increase in per capita income, an 8 percent increase in food consumption, a 15 percent increase in assets, and a 96 percent increase in savings, compared with similar groups of people not enrolled in the program.
Abhijit Banerjee, one of the researchers involved in the study, said in a press release: “The results show that three years after the intervention, hunger is down, consumption is up, and income is up.” He added: “It seems to be an improvement that happens and stays intact,” noting that the self-reported mental health of participants improved as well: “They are happier, too.”
Importantly, the study results show not only what works, but also that what works in one setting can be made to work in another.