Left Behind: Chronic Poverty in Latin America and the Caribbean

by Renos Vakis, Jamele Rigolini, Leonardo Lucchetti

Overview

One out of every five Latin Americans or around 130 million people have never known anything but poverty, subsisting on less than US$4-a-day throughout their lives. These are the region´s chronically poor, who have remained so despite unprecedented inroads against poverty in Latin America and the Caribbean since the turn of the century. Left Behind: Chronic Poverty in Latin America and the Caribbean takes a closer look at the region’s entrenched poor, who and where they are, and how existing policies need to change in order to effectively assist them. The book shows significant variations of rates of chronic poverty both across and within countries. Within a single country, some regions show incidence rates up to eight times higher than the lowest. Despite the higher rates of chronic poverty in rural areas, chronic poverty is as much an urban as a rural issue. In fact, considering absolute numbers, urban areas in many countries, including Chile, Brazil, Mexico, Colombia and the Dominican Republic, have more chronic poor than rural areas. Undoubtedly the region has come a long way during the decade in terms of poverty reduction, guided by a mix of sustained growth and increased levels in amounts and quality of public spending and programs targeted directly or indirectly to the chronic poor. While improving endowments and the context where the chronic poor live is a necessary condition going forward, the decade’s experience suggests that it may not be enough to reach the chronic poor. The book posits that refinements to the existing policy toolkit – as opposed to more programs – may come a long way in helping the remaining poor. These refinements include intensifying efforts to improve coordination between different social and economic programs, which can boost the income generation process and deal with the intergenerational transmission of chronic poverty by investing in early childhood development. Equally important though, there is an urgent need to adapt programs to directly address the psychological toll of chronic poverty on people’s mindset and aspirations, which currently undermines the effectiveness of the existing policy efforts.

Product Details

ISBN-13:	9781464806605
Publisher:	World Bank Publications
Publication date:	07/26/2016
Series:	Latin American Development Forum
Pages:	156
Product dimensions:	6.00(w) x 9.00(h) x 0.40(d)

Table of Contents

Foreword xvii

Acknowledgments xix

About the Authors xxi

Abbreviations xxiii

Overview 1

A Successful Decade with Challenges Ahead 1

A Framework for Studying Chronic Poverty 3

Measuring Chronic Poverty in the Absence of Longitudinal Data 5

Five Stylized Facts about Chronic Poverty in Latin America and the Caribbean 5

From Diagnosis to Policies: Design Elements Supporting the Chronically Poor 18

Notes 24

References 24

Chapter 1 The Roaring 2000s and the Left Behind 27

Notes 31

References 31

Chapter 2 What is Chronic Poverty and How is it Measured? 33

Conceptual Underpinnings 33

The Empirical Challenges of Measuring Chronic Poverty 40

Notes 48

References 49

Chapter 3 Five Facts about Chronic poverty in Latin America and the Caribbean 53

Stylized Fact 1 One of Five People in Latin America and the Caribbean Lives in Chrome Poverty 53

Stylized Fact 2 Chronic Poverty Tends to Be Geographically Concentrated 57

Stylized Fact 3 Chronic Poverty Is As Big a Problem in Urban Areas as in Rural Areas 60

Stylized Fact 4 Economic Growth Was Not Sufficient to Lift the Chronically Poor out of Poverty 62

Stylized Fact 5 The Chronically Poor Have Limited Income Opportunities 66

Notes 70

References 70

Chapter 4 Unraveling the Complexes of Chronic Poverty 71

Endowments, the Context and Chronic Poverty 72

State of Mind and the Process of Emerging from Poverty 87

Notes 94

References 94

Chapter 5 From Diagnosis to Policies: Crafting Coordinated Policies That Reduce Chronic Poverty 99

Improving Endowments and the Enabling Context 99

Coordinating Poverty-Reduction Efforts 101

Recognizing the State of Mind of the Poor in Crafting Policy 111

Developing Coordinated Solutions that Address Behavioral Constraints: Social Intermediation Services 117

Note 119

References 119

Appendix 121

Index 125

Boxes

2.1 The framework in practice 39

3.1 Monetary versus nonmonetary measures of chronic poverty 55

4.1 Ethnicity and chronic poverty in rural Guatemala 74

4.2 Connectivity pays off: Reducing poverty in rural Peru 78

4.3 Improving institutions, reducing poverty in Colombia 81

4.4 Does increased public expenditures reduce crime and chrome poverty? Evidence from Mexico 85

4.5 Does poverty cause stress? 88