The concept of 'chronic poverty', its value for poverty analysis and for pro-poor policy making

Term Paper, 2008

11 Pages, Grade: merit



1. Introduction

2. Chronic Poverty

3. Current poverty analysis and development policy

4. Value of the concept of ‘chronic poverty’
4.1. Implications of the concept ‘chronic poverty’ on a conceptual level
4.2. Implications of the concept ‘chronic poverty’ for development policy and intervention

5. Conclusion


1. Introduction

Poverty reduction stands in the centre of the current development agenda of governments and aid agencies and is seen as an overarching aim of development intervention. Important commitments of donors and governments to fight poverty are on the national level the Poverty Reduction Strategy Papers (PRSP)[1] and on the international level the Millennium Development Goals (MDG)[2] with their first goal to half extreme poverty by 2015 (CPRC, 2004).

It is not clear that all MDG will be reached and, even if poverty is halved by 2015, 900 million people would still live in extreme poverty. There is a danger that those suffering the severest forms of poverty will not be reached by the recent poverty agenda. It gets increasingly obvious that even in countries that perform well in terms of poverty reduction, there remains significant numbers of people in deprivation which is a sign that certain forms of poverty are not addressed by the current development agenda (Green and Hulme, 2005). The concept ‘chronic poverty’ is an attempt to understand and address those forms of poverty.

Chronically poor are defined as “people who remain poor for much of their life course, who may ‘pass on’ their poverty to their children, and who may die of easily preventable deaths because of the poverty they experience” (CPRC, 2004: 3)[3]. Conservative estimates speak of 300 to 420 million chronically poor worldwide (ibid.).

The following three sections attempt to answer the question of whether the concept of ‘chronic poverty’ adds value to current poverty analysis and development policy. Section 2 introduces the concept ‘chronic poverty’ and section 3 gives an overview about current poverty analysis and its critiques, with a focus on current approaches and understandings of poverty which influence the current poverty reduction agenda.[4] Section 4 presents the analysis of whether the concept adds value to poverty analysis and the implications this may have for pro-poor policy making.

It will be argued that the concept of ‘chronic poverty’ has advantages on the conceptual level of poverty analysis and on the practical level of development policy and intervention. Those levels are highly interdependent: which measures are taken to fight poverty is dependant on how it is analysed and defined by academics, donors, societies and national decision makers. Therefore section four is divided into two parts: The first part will discuss the influences for conceptualising poverty and the second part will concentrate on practical implications for development policy and intervention.

2. Chronic Poverty

Chronic poverty is understood as poverty which lasts over several years[5], often a whole generation or even several generations. Its past or perceived future persistence and the inability to escape from poverty are the key points about the concept. Chronic poverty can be distinguished from transient poverty which means that people fall into poverty for a short time but are able to escape (see Figure 1) (Hulme & Shepherd, 2003).

Figure 1: Chronically, transitory and non-poor

illustration not visible in this excerpt

Source: CPRC, 2004: 5

McKay and Lawson (2003) find in their study that chronic poverty can be associated with permanent disadvantages like lack of assets, which keeps people and their children poor while transient poverty is more associated with cases where people fall into poverty for a short time due to external shocks like serious illness, price fluctuation or other economic shocks. Chronically poor do not just have a low or no income, rather they suffer multidimensional deprivations like hunger, no access to services or productive assets, and they have low capabilities in terms of education, health or social capital, they are socially isolated and suffer from exploitation (CPRC, 2004). Furthermore their welfare is mostly highly dependant on support from others like family or other informal sources, Non Governmental Organisations (NGO), aid agencies or state systems.


[1] A condition of debt relief in the framework of the Highly Indebted Poor Countries Initiative II (HIPC II) for Least Developed Countries (LDC) is that the money is spent on poverty reduction. The national PRSP represents the strategies through which poverty shall be reduced in a country and shall be formulated in a participative process (Rodenberg, 2003).

[2] The United Nations (UN) agreed 2000 in the Millennium Declaration (UN 2000) to halve extreme poverty by 2015 and to reach seven other MDG regarding education, health, gender empowerment and ecological sustainability.

[3] The research about chronic poverty is still at its beginning but in particular the work of the Chronic Poverty Research Centre (CPRC) shows progress in the understanding of chronic poverty, e.g. in the Chronic Poverty Report 2004-05 edited by the Centre. Much of this paper refers to this report which can b downloaded from

[4] For a detailed and historical discussion of poverty analysis see Kanbur and Squire 2001.

[5] Hulme and Shepherd (2005) suggest a period of five years as in most cultures a period of five years is perceived as a significant period, as there is often a five year gap between existing panel data and as existing analysis show that people who are poor for a period of five years have a high probability to remain poor.

Excerpt out of 11 pages


The concept of 'chronic poverty', its value for poverty analysis and for pro-poor policy making
University of Manchester  (Institute for Development Policy and Management)
Poverty and Livelihoods: Analysis, Policy and Action
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ISBN (eBook)
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544 KB
chronic poverty, poverty, poverty concepts, poverty analysis, development
Quote paper
Cynthia Dittmar (Author), 2008, The concept of 'chronic poverty', its value for poverty analysis and for pro-poor policy making, Munich, GRIN Verlag,


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