The topic of development relating economic growth and poverty is not without controversy. It would be difficult to debate the fact that faster economic growth is associated with faster poverty reduction. But the question is, ‘to what extent?’ Criticism of growth oriented poverty reduction programs have increased, and in many circles it is not viewed to be the optimal and most efficient strategy, leading to intense research in the area. This paper takes a look at these different stances on growth oriented reduction policies, while arguing that although there continues to be a robust relationship between growth and poverty reduction, other measures must be taken alongside it to effectively alleviate poverty. In essence, this means that there is no one single pathway that can be taken. A full spectrum of strategies must be undertaken and the combined effort, not economic growth itself, will lead to successful development. The paper first looks at the different ways of viewing poverty, followed by an analysis of Dollar and Kraay (2000, 2002). It then briefly addresses growth on non-income poverty, before delving into pro-poor growth, and alternate policies affecting poverty reduction.
Ways of looking at poverty
We begin by observing the different definitions of poverty. Poverty must be viewed wholly, rather than in a monetary sense, before developing procedures to alleviate it. Up to the 1960s, poverty was economically determined, and standards of living were measured as income per capita (Sumner, 2007: 6). This economic indicator, along with others such as ‘income-poverty lines’, and ‘income inequality’ were eventually expanded into ‘basic needs’ by people such as Dudley Seers. Seers (1969) expanded the meaning of development beyond GDP per capita and into basic needs, which included the physical necessities for a basic standard of living.... [continues]
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