FINAL Working paper 1 Conceptualising Livelihoods of the Extreme Poor January 2002 Nasrin Sultana livelihood 1 Page 1 of 63 ACKNOWLEDGEMENTS I am immensely thankful to PROSHIKA and DFID Bangladesh for undertaking such a project, which has the aim of poverty eradication in Bangladesh. I would like to express my earnest gratitude to Ms. Clare Hamilton Shakya, Regional Co- ordinator- DFID and research guide of this study who was the constant guide of the study and provided administrative support for the work. She also provided insightful comments on this Ist phase of the study. I am deeply indebted to Dr. Janet Seeley, Academic adviser of this study. She made valuable contribution to this paper. She provided valuable insights and academic support to me. I am grateful for her stimulating guidance and encouragement. My heartfelt gratefulness to Dr. Iqbal Alam Khan, Deputy Director-IMEC, PROSHIKA and research guide of this study for his critical review of earlier versions of this paper. This study was under his direct supervision from the stage of planning at the conceptual level to development of this paper. I want to express my gratitude to Mr. Gautam Shuvra Biswas, Co-ordinator of the study who is in UK now. We started the work together and I missed him every moment while I was writing the paper. I am thankful to Mr. Abu Naser, Co-ordinator IMEC-PROSHIKA for providing all necessary administrative support to do the work smoothly. I would like to express my thanks to my team members Zubair Ali Khan, Munshi Israil Hussein, Salim Ahmed Purvez, Kamruzzaman Tapan, Sinora Chakma, Mayee, Ahmed Borhan for their continue support in all aspects, and for inspiration and enthusiasm for this paper. We shared the field experience, which provided the insights for the thematic ideas of this paper. I have found the team spirit to be the main strength of this study. Special thanks also goes to my ex- colleagues Krazai Chowdhury and Nazneen Akhter Banu (who are not with us now) for their active support in this study. I also want to convey my regards to my colleague Fatima Jahan Seema for her valuable comments and suggestions on this paper. I am thankful to all of my colleagues in IMEC, especially Koly, Shapna, Dalia, Samsul Haq Mandal, Selim, Moudud who always encouraged me and provided all support. I would like to acknowledge my gratitude to the villagers who shared with us their livelihoods, which helped us to gain insight into rural life. I am immensely indebted to Mr. Faruq Ahmed who has taken the responsibility for the final editing of this report. Finally, I am indebted to my family for their encouragement of my work. livelihood 2 Page 2 of 63 Acronyms ADC-Area Development Centre BBS- Bangladesh Bureau of Statistics BRAC-Bangladesh Rural Advancement Committee CHT-Chittagong Hill Tracts DFID-Department for International Development EIG-Employment and Income Generating EP-Extreme Poor FHH-Female Headed Household GIS- Group Information System GO-Government HDI- Human Development Index HPI-Human Poverty Index ILO-International Labour Organisation IMEC-Impact Monitoring and Evaluation Cell LLP-Low lift pumps MLLP-Mini low lift pumps MSTW-Mini Shallow Tube-wells MTR-Mid Term Review NFPE-Non-formal Primary Education NGO-Non-Government Organisation SEED Small Economic Enterprise Development Program SL-sustainable Livelihood STW-Shallow tube-wells ULS -Urban Livelihood Study UPDP-Urban Poor Development Program livelihood 3 Page 3 of 63 Glossary Bengali- Ethnic community Chakma- Ethnic community Christian- Religious community Garo- Ethnic community Hazong- Ethnic community Hindu- Religious community Muslim-Religious community Sawtal- Ethnic community Shanty bahini-Militia group in CHT Zakat- Religious charity Purdah- veil Begar- no wage, only food Puja- religious festival for Hindu community Administrative Unit Region CHT-Region District Brammahnbaria Comilla Dhaka- District Magura Manikgonj- District Mymenshing-District Nawgaon- District Rajshahi- District Thana Aditmari- Durgapur- Thana Imatpur-Thana Mirzapur Saturia Savar Village Bathuli- village Hazrapur Kaitta-village Kalabagan Kutubdia livelihood 4 Page 4 of 63 Contents 1. The Extreme Poor: a contested concept 1.1 Multidimensionality of Poverty 1.1.1 General Perception 1.1.2 Recent Understanding: other concepts  Entitlement  Social exclusion  Vulnerability  Rights based approach  Livelihoods approach 2.Definitions of the Extreme Poor 3. The Extreme Poor in Development Practice in Bangladesh 3.1 Dimensions and causes of poverty in Bangladesh 3.2 Identification of the extreme poor from a practitioner's view 4. The Extreme Poor as an Issue for Development Intervention: A Case of PROSHIKA 4.1 Creation of a Provision for Inclusion 4.2 A Challenge for keeping the extreme poor included 5. Extreme Poor's Livelihoods: lessons from Initial field exploration 5.1 Issues Related with Extreme Poor 5.2 Other Relevant Issues 6. Conclusion livelihood 5 Page 5 of 63 1. The Extreme Poor: a contested concept Introduction The concept of the 'extreme poor' has been widely discussed in development discourse in recent years. There is no universal definition of the extreme poor. The concept of the extreme poor is not simple and it is not a single notion. It can be seen from different angles and it has links with other concepts. The concept has been discussed in different ways and has been changed and modified over time. In this section an effort has been made to understand the concept in its different aspects. 1.1 Multidimensionality of poverty To understand the multidimensionality of poverty the concept of the extreme poor has been discussed here in the light of the general perception of the concept and also the recent understanding about it. 1.1.1 General perception The concept of the 'extreme poor' has been widely discussed in development discourse for a long time. The general perception of the concept is basically based on economic factors. At the early stages the economic factors were considered in measuring poverty while some researchers and development organisations have included non-economic factors in recent years. It would be helpful to explain briefly the economic and non-economic approaches in understanding and defining poverty. The economic approach typically defines poverty in terms of income and consumption. The term 'income' is sometimes used loosely to refer only to the main component of monetary income for most households. Generally, consumption, particularly calorie intake, depends upon income but sometimes it varies due to the influence of other socio-economic factors. However, it is difficult to define it because it differs among societies, communities, and even households. For example, in Bangladesh, the standard calorie intake is 2100-2200, but it is 2300-2400 for the other South Asian countries such as Sri Lanka and India. Moreover, if the expenditure increases then calorie livelihood 6 Page 6 of 63 intake decreases. Obviously an economic approach to the definition of poverty gives rise to some criticism:  Firstly it does not cover all factors associated with poverty. For example, social, climatic or infra-structural factors can influence or interrupt individuals or households income. All these are related with the deprivation trap (Chambers 1983), which makes people vulnerable and pushes them below the poverty line.  Secondly, it cannot be standardised. Considering the indicators that are used with the economic approach like income or consumption vary within countries, communities, societies and between individuals. A unique income level cannot be set for the all countries. Consumption depends on family sise, income, physical efficiency, nature of work etc. People’s consumption rate is reduced at time of crisis.  Thirdly, it cannot be estimated accurately. In general, people are reluctant to disclose their income to others. It is often more difficult in the rural areas, particularly with people who are self-employed. They are not familiar with the estimation process and are not used to keeping records. In rural areas, people have a number of income sources like gardening in the homestead land, poultry and livestock, collecting vegetables as well as fuel, and casual fishing. They may also produce something like crafts. A portion of their production is consumed, so that they never consider it as their income. Due to these limitations, it is tried to estimate income using expenditure and consumption. But still it is not an accurate technique to estimate income.  Fourthly, it is difficult to standardise the income level. It is critical to compare the income level in different countries. In contrast, begging is a request for alms or charity for oneself. The act of begging is understood differently in different cultures, but it is strongly associated with both poverty and dependency and widely stigmatised. But if we consider income to measure or understand poverty, it does not give us a clear picture. For example a beggar may earn more than the poverty level income, but he/she will be treated as poor.  Finally, indicators set by the outsiders and general people’s role is passive Most of the indicators considered under the economic approach are measurement indicators and these types of indicators set by the researchers, economists and the planners. The ordinary people or the respondents play a passive role in this process. So that recipient’s judgement does not get livelihood 7 Page 7 of 63 reflected through this type of measurement. For example, some one earns more than the minimum set amount of poverty measurement. But due to a chronic illness, s/he has to spend one portion of his/her income regularly, which seriously affects his/her living or might make him/her vulnerable. Another example can be cited here. If a person has a number of daughters, and for each one he/she has to give a dowry at marriage, it will affect their level of income. These are not considered in measuring poverty. To overcome these difficulties, some new indicators are introduced under the non-economic approach to understanding poverty. Non- Economic Approach The non-economic approach involves a broader conception of poverty and deprivation than does the definition typically adopted under the economic approach. A number of concepts of poverty can be considered under the non-economic approach like living standard, basic needs, inequality, relative poverty, subsistence, subjective, human development index (HDI), human poverty index (HPI) and so on. Under the non-economic approach, emphasis has been given on some non-income indicators like housing quality, nutritional status, access to services, assets holding etc. However, in recent years, analysing poverty has begun to include a wide range of factors such as vulnerability, isolation, social exclusion, powerlessness, personal dignity, security, self-respect, ownership of assets etc. Actually, all the factors associated with both economic and non-economic approaches considered in the poverty concept are equally important and have an active role in understanding the concept of extreme poverty. In fact, all the economic and non-economic factors are relative and conditional, which, create ill being. Ill-being is multidimensional and refers to different sorts of bad experience. Lack and want are material; hunger, pain, discomfort, and exhaustion are physical; bad personal relations, exclusion, rejection, abuse, isolation and loneliness are social; vulnerability and fear relate to insecurity; and helplessness, frustration and anger reflect powerlessness (Narayan et al 2000). livelihood 8 Page 8 of 63 The above discussion can be summarised by starting that to understand the poverty concept only economic factors are not enough to get a holistic picture. It is equally important to consider the non-economic factors, which have a very crucial role in poor people’s livelihoods. Over time the thinking process has changed to take different non-economic factors into consideration. An attempt has been made to explain the limitations of economic approach and the importance of non-economic factors in this section. 1.1.2 Recent Understanding: other concepts To explain the multidimensionality of extreme poverty it is necessary to look at the other related concepts. From the previous discussion it has been seen that some other non-economic factors get attention in measuring poverty, which are included in some related concepts. In recent years some related concepts are considered for getting a holistic picture about the concept of extreme poverty. The major related concepts are: entitlement, social exclusion, vulnerability, rights based approach and livelihoods approach. Brief descriptions of these concepts are given below to explain the co-relation between these concepts and the concept of the extreme poor.  Entitlement According to Sen, an individual or household owns a set of resources and it is exchanged to acquire control over commodities. Sen’s concept of ‘entitlement’ refers to the complex ways in which an individual or a household command resources (Sen, 1988). Entitlement has two dimensions: endowment and exchange. An individual or a household is endowed with a set of resources, which creates the availability of the economic options for the individual or the household. The resources are as follows:  Material resources: the sets and stores of value, which include money as well;  Human resources: the skill and capabilities of people within a household, including the age, gender, education and skill status, and health and nutritional condition of household members;  Social resources: the set of relationships, which an individual or household has with other individuals, households and organisations, which may be used to maintain or improve livelihood 9 Page 9 of 63 their situation. These are regarded as “claims” for assistance with food, credit, labour or productive resources or services from kin, neighbors, labour groups, patrons, landlords and employers, from government or from NGOs and the international community;  Common property resources: natural resources, which may be shared by different kinds of households either with clearly defined property rights, or adjudged as national common property. Figure 01: Entitlement (set of resources & set of relationships) Endowment or Ownership Exchange (set of (set of resources) relationship) The figure shows the process of entitlement. Actually endowment and exchange are the most important factors relevant to people's livelihoods. Sen pointed out that it is the right to use resources, rather than the existence of the resources themselves, that is characteristic of extreme poverty. There is a mechanism, which influences (social network and /or social relationship) exchange or enables people to use what they are endowed with. For example, if an individual wants to sell labour, then s/he has to get someone who is willing to buy it. Nevertheless, there are some people within the community who are unable to participate in the institutions patronised by the majority and in a position to opt out of the mainstream institutions. They are socially excluded within the society and their mobility as well as access is very limited. Due to this social position, they are unable to exchange their resources or limited exchange. Beside these, the factors like stress (a small, regular, predictable disturbance with immediate impact), trends and seasonality affect the people’s livelihoods and make them vulnerable. Through the above discussion, it is clear that individuals can improve the position within the community, if he/she gets the opportunities to exchange the set of resources s/he has. On the other hand due to the disruption in terms of food, and entitlement irregularity poor people face livelihood 10 Page 10 of 63