rsz_drip_irrigation_in_field_nepal copyPaul Polak and Mal Warwick’s award-winning book, The Business Solution to Poverty, highlights 20 “takeaways” that encapsulate much of the book’s essence. Today we feature the third of those takeaways. Future posts will include others. 

The most obvious, direct, and effective way to combat poverty is to help poor people earn more money. 

Poverty is complex. There’s no universally accepted definition — far from it. Depending on who you talk to, you may find that one or more of a great many factors must be taken into account to gain an understanding of poverty, much less to define it: lack of access to adequate food, shelter, education; lack of political power; lack of access to information; and so forth.

However, there are two outstanding reasons why the most convenient way to think about poverty is in terms of money. First, the most common way poverty is described in the world today is in terms of income levels; those who are poor are variously said to live on $1.00 or less per day, $1.25 or less, $2.00 or less, or $2.50 or less. (Don’t blame me: blame the World Bank.) Second, when you have candid conversations with poor people and ask them why they’re poor, they’re most likely to tell you that they simply don’t have enough money.

While not every way that poor people are held back can be corrected with money — the lack of political power, for example — most of the impediments can be overcome with cash. Which is why Paul Polak and I insist that the most effective way to end poverty is to increase the livelihood of poor people.  

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