poverty concepts for development planning in bangladesh shamsul alam, m.a. econs. ph.d (newcastle)...

POVERTY CONCEPTS FOR DEVELOPMENT PLANNING IN BANGLADESH

Shamsul Alam, M.A. Econs. Ph.D (Newcastle)

Member (Senior Secretary)General Economics Division (GED)

Planning Commission Government of the People’s Republic of Bangladesh

Understanding Poverty Concepts and Indicators

GED, Planning Commission

Definition of Poverty

Nelson Mandela: Poverty is not natural rather it is man made out of sociopolitical and economic context.

United Nations: Poverty is a human condition characterized by the sustained or chronic deprivation of the resources, capabilities, choices, security and power necessary for the enjoyment of an adequate standard of living and other civil, cultural, economic, political and social rights.


Types of Poverty

Primary Poverty: The incapability of having an income (expenditure) needed to buy the bare necessities of life.

Secondary Poverty: A situation where real incomes are adequate to meet the minimum needs but the poor do not spend the money for satisfying these needs.


Types of Poverty (Cont.)

Absolute Poverty: Inability of an individual to meet the minimum requirement of life.

Relative Poverty: Income inequality in society creates relative poverty. Perceived poverty relative to wealth of others.


Methods of Measuring Poverty

Poverty Gap Ratio: Mean distance separating the population from the poverty line (with the non-poor being given a distance of zero), expressed as a percentage of the poverty line.

Squared Poverty Gap: Measures severity of poverty, takes into account not the distance separating the poor from the poverty line, but also the inequality among the poor.


Pro-poor growth

Focuses attention on the extent to which poor women and men are able to participate in, contribute to and benefit from growth, as measured by changes in the incomes of the households in which they live and the assets they and their children acquire to earn higher incomes in the future (OECD, 2006). Benefits of growth create opportunities for poor also.

Provides greater opportunity for the poor to participate in the growth process, thus promoting equity.

Poverty & Inequality Scenario in Bangladesh


MDG Progress Report 2013, GED9

Poverty at a glance through MDG indicators

Indicators (Six Indicators have been shown)

Base Year1990-91

Current Status

Target 2015

Status of

Progress

Proportion of people below national upper poverty line (%) (CBN method)

56.7 24.47(2014 est)

29.0 =

Poverty gap ratio (%) 17.0 6.5 8.0

Employment to population ratio (15+), (%)

48.5 59.3 For all

Prevalence of underweight children under –five years of age (6-59 months), (%)

66.0 31.9(2013)

33.0 =

On track, = Goal met, Need attention

Head Count Poverty Ratio

MDG Progress Report 2013, GED

Head Count Ratio following $1.25 (PPP)

0

10

20

30

40

50

60

70

80

Head Count Ratio following$1.25 (PPP)

70.2 60.9 58.6 50.5 43.3

1992 1996 2000 2005 2010

Long Term Poverty Trends


Poverty Gap Ratio

MDG Progress Report 2013. GED

Poverty Gap ratio from 1992-2010

0

5

10

15

20

Po

vert

y g

ap i

n p

erce

nt

Rural 18.1 15.95 13.8 9.8 7.4

Urban 12 10.75 9.5 6.5 4.3

National 17.2 15.05 12.9 9 6.5

1991-92 1995-96 2000 2005 2010

Share of Poorest Quintile in National Income


Share of poorest quintile in national income

0

2

4

6

8

In p

erce

nt

Rural 6.74 6.49 7.09 5.88 5.76

Urban 6.4 5.12 5.04 4.82 5.07

National 6.52 5.71 6.15 5.26 5.22

1991-92 1995-96 2000 2005 2010

Share of Poorest Quintile in National Consumption


Share of poorest quintile in national consumption

0

5

10

15

In P

erce

nt

Rural 9.86 9.93

Urban 7.46 8.06

National 8.76 8.85

2005 2010

Coefficients of Income Gini and Expenditure Gini


1991-92 1995-96 2000 2005 2010

Gini Income Exp. Income Exp. Income Exp. Income Exp. Income Exp.

National 0.388 0.260 0.432 0.310 0.451 0.334 0.467 0.332 0.458 0.321

Urban - 0.310 - 0.370 0.497 0.373 0.497 0.365 0.452 0.338

Rural - 0.250 - 0.270 0.393 0.279 0.428 0.284 0.430 0.275

Poverty Scenario in Bangladesh

Extreme Poverty Map 2010

Poverty maps provide disaggregated poverty estimates to better understand the geographical variations in poverty incidence;

The maps also provide a good indication of where the most food insecure areas of the country are;

Poverty Scenario in Bangladesh (Continued)

Poverty Map 2010 Rangpur and

Barisal Divisions have the highest incidence of poverty;

Chittagong and Sylhet Divisions have the lowest incidence of poverty;

Poverty Scenario in Upazila Level Richest Upazilas in 2005

Upazila ZilaPoverty Rate-

upper (%) 2005

Rank 2005 Poverty Rate-upper(%) 2010

Rank 2010

Double Mooring

Chittagong 0.10 1 0.01 1Dhanmondi Dhaka 2.50 2 1.37 5Motijheel Dhaka 3.10 3 1.30 3Kotwali Dhaka 3.90 4 5.88 25

Sutrapur Dhaka 4.00 5 4.58 17Ramna Dhaka 4.70 6 3.82 12Tejgaon Dhaka 5.70 7 5.28 21Gulshan Dhaka 8.60 8 3.34 8Mirpur Dhaka 8.60 9 6.66 26Kotwali Chittagong 9.90 10 0.27 2

Poverty Scenario in Upazila Level (Cont.)

Poorest Upazilas in 2005


upper (%) 2005


Rank 2010

Alikadam Bandarban 78.40 1 42.88 108Galachipa Patuakhali 76.80 2 25.96 327Thanchi Bandarban 76.70 3 53.05 32

Dashmina Patuakhali 76.60 4 21.76 377Shyamnagar Satkhira 75.70 5 50.19 50

Dimla Nilphamari 75.70 6 35.22 197Ruma Bandarban 75.40 7 42.30 116

Rowangchhari Bandarban 75.40 8 32.91 228Kaliganj Satkhira 74.90 9 47.96 65

Kala Para Patuakhali 74.20 10 20.31 391

Poverty Scenario in Upazila Level (Cont.) Richest Upazilas in 2010

Upazila Zila Poverty Rate-upper (%) 2010

Rank 2010Poverty Rate-

upper(%) 2005Rank 2005

Double Mooring

Chittagong 0.01 1 0.10 1

Kotwali Chittagong 0.27 2 9.90 10

Motijheel Dhaka 1.30 3 3.10 3

Biman Bandar Dhaka 1.31 4 11.30 16

Dhanmondi Dhaka 1.37 5 2.50 2

Cantonment Dhaka 1.54 6 12.10 26

Kushtia Sadar Kushtia 3.04 7 22.50 64

Gulshan Dhaka 3.34 8 8.60 8

Mirpur Kushtia 3.35 9 17.40 45

Bheramara Kushtia 3.41 10 39.70 201

Poverty Scenario in Upazila Level (Cont.) Poorest Upazilas in 2010


upper (%) 2010


Rank 2005

Char Rajibpur Kurigram 68.82 1 73.90 12

Phulbari Kurigram 68.48 2 65.80 43

Rajarhat Kurigram 67.69 3 64.00 46

Ulipur Kurigram 65.32 4 66.90 34

Bhurungamari Kurigram 65.14 5 68.20 27

Nageshwari Kurigram 64.96 6 70.30 20

Mhendiganj Barisal 64.37 7 68.40 26

Hizla Barisal 62.26 8 60.20 66

Haim Char Chandpur 61.30 9 30.80 373

Chilmari Kurigram 61.07 10 69.00 23

*More developed road and transport system*Large number of social safety nets programs. Empowerment is possible through targeted SSNPs*Inflow of remittance money•*Micro credit•*Rural biased credit facility

Growth Drivers in Poverty Reduction



Distribution of Benefits of Safety Net Programmes by Economic Status in Rural Bangladesh:

Poverty Group Share of beneficiary households(%)

Share of total funds received (%)

Extreme Poverty 24.5 25.6

Moderate poor 15.1 14.8

Marginally non-poor

14.6 16.6

Well off 45.8 42.9

Total 100.0 100.0

Source: Osmani,s.r.(2015), Linking Equity And Growth In Bangladesh, Background Paper 7 th Five Year Plan

Impact of Disaster on Poverty & Inequality

& Reducing Poverty



Mainstreaming Climate ,Poverty and Disaster Management

Poverty remains the main development agenda in last 4 decades.Gender, Disability, Human Rights has become integral part of poverty when mainstreaming is concerned. Environment has become a mainstreaming agenda since 1992Disaster has become a policy agenda since 1991Climate change has become a priority policy agenda since 2004Poverty-Gender-Environment-Climate-Disaster nexus has become an agenda since 2010

Impact of Disaster on Poverty & Inequality Disasters usually mean higher

government expenditure and/or part reallocation of already committed financial resources.

Disasters also mean a fall in government revenue because they cause a reduced level of economic activity.

Disasters can also dampen investment and reduce long term economic growth.


Impact of Disaster on Poverty & Inequality (Cont.) disasters and the destruction of assets

(even by river erosion) of the poor can trap families in chronic poverty because they will not have the necessary income to rebuild their homes, replace assets and meet basic needs. In other words, disasters can be a source of poverty.

Poverty has direct linkages with different types of vulnerability including physical, social and economic of the communities at risk. GED, Planning Commission

Reducing Poverty- 3 Pronged Planned Approach Promoting opportunities (encouraging effective private investment; expanding into international markets; building the assets of poor people; addressing asset inequalities across gender, ethnic, racial and social divides; getting infrastructure and knowledge to poor areas – rural and urban).

Facilitating empowerment (laying the political and legal basis for inclusive development; creating public administrations that foster growth and equity; promoting inclusive decentralization and community development; promoting gender equity; tackling social barriers; supporting people’s social capital).

Enhancing security (creating a modular approach to helping poor people manage risk; developing national programmes to prevent, prepare for and respond to macro-shocks – financial and natural; designing national systems of social risk management that are also pro-growth; addressing civil conflict; tackling the HIV/AIDS epidemic).

7 FYP Approach

Creating more jobs. Job creating growth. Sectoral emphasis for growth. Public investment planning. Redesigning Social Security Programs. Devolution of power with responsibilities

for ensuring greater participation. Promoting migrant workers and inward

remittances. Provision of Agricultural Subsidies


Ending

Many Thanks


poverty concepts for development planning in bangladesh shamsul alam, m.a. econs. ph.d (newcastle)...

Documents

relative poverty

ged9 poverty

absolute poverty

secondary poverty

depth of poverty

squared poverty gap

perceived poverty relative

poverty inequality scenario