Part 1 of 6: Defining urban poverty

Urban Poverty in the Global South: Scale and Nature, by Diana Mitlin and David Satterthwaite, documents how the scale and depth of urban poverty in Africa and much of Asia and Latin America is greatly underestimated because of inappropriate definitions and measurements. How a 'problem' is defined and measured obviously influences how the 'solution' is conceived, designed and implemented — and evaluated.

The use of inappropriate poverty definitions that understate and misrepresent urban poverty helps explain why so little attention has been given to urban poverty reduction by aid agencies and development banks. It explains the paradox of so many poverty statistics apparently showing relatively little urban poverty despite the evidence showing the very large numbers living in poverty. About one in seven of the world's population lives in poor-quality, usually overcrowded housing lacking provision for safe and sufficient water, sanitation, and many other needs. This includes very large numbers of urban residents who are malnourished and suffer premature death or disease burdens that are preventable. A significant proportion of these people are deemed not to be poor by many poverty lines.

Almost all official measurements of urban poverty are also made with no dialogue with those who live in poverty and who struggle to live with inadequate incomes. It is always the judgement of 'experts' that identifies those who are 'poor,' who may then be ‘targeted’ by some programme; at best, they become 'objects' of government policy which may bring some improvement in conditions, but they are rarely seen as citizens with rights and legitimate demands who also have resources and capabilities that can contribute much to more effective poverty reduction programmes.

The dollar-a-day poverty line that was chosen as one of two indicators for monitoring progress on the Millennium Development Goal of eradicating extreme poverty and hunger lie at the core of why urban poverty is underestimated. If we are to use a monetary measure for defining and measuring whose income or consumption is insufficient (and from this determining who is poor), this measure has to reflect the cost of food and of non-food needs. If the costs of food and non-food needs differ — for instance, by nation and by location within each nation — this monetary measure has to be adjusted to reflect this. But the dollar-a-day poverty line does not do this sufficiently.

For instance, applying the dollar-a-day poverty line in 2002, less than 1 per cent of the urban populations of China, the Middle East and North Africa, and East Europe and Central Asia were poor. In Latin America and the Caribbean, less than 10 per cent of the urban population was poor. For all low- and middle-income nations, 87 per cent of their urban population was not poor. As this book documents in detail, there is a very large volume of work that shows how these figures are inaccurate and the associated methodologies inappropriate.

Next: Drawing Unrealistic Poverty Lines

Summarized from Urban Poverty in the Global South: Scale and Nature, by Diana Mitlin and David Satterthwaite, Routledge, January 25, 2013.

Part 2 of 6: Drawing Unrealistic Poverty Lines

How urban poverty is defined and measured by governments and international agencies, and the many ways in which these definitions contribute to understating and misrepresenting its scale and nature, are explored in Chapter 2. After reviewing the approaches used in the World Bank national poverty assessments and the national poverty programming processes associated with international development assistance and the Millennium Development Goals, we found the criteria used to set many poverty lines are unrealistic and result in often large underestimates in the costs of non-food needs faced by low-income urban residents — including rent for housing and payments needed to obtain access to water, toilets, schools, and health care.

Different criteria used for defining poverty in a given nation can show almost no urban poverty or 30 to 50 percent of the urban population in poverty. There are hidden influences and assumptions within poverty definitions that often help under-count who is identified as being poor — for instance, an assumption that the costs of meeting the needs of infants and children are only a small proportion of the costs of adult needs. Inappropriate poverty lines also help explain why urban populations that apparently have very little poverty may still have high levels of under-nutrition and very high infant, child, and maternal mortality rates.

Many urban centres (especially the more successful ones) are places where the costs of non-food needs are particularly high, especially for low-income groups who live in informal settlements where costs such as rent, water (from vendors or kiosks), and access to toilets are particularly high (although the quality of accommodation is very low). In addition, the dollar-a-day poverty line and most other poverty lines are set with no consideration of who lives in poverty — for instance, those who do not have reliable, good quality, and not-too-costly access to water, sanitation, health care, and schools, as well as having voice and being served by the rule of law. Aid and other forms of development assistance are legitimated on the basis that they meet the needs of 'the poor', but decisions about the use of development assistance do not include any role for 'the poor', nor are those who make such decisions accountable to 'the poor'. Similarly, poverty lines are set without dialogue and without needed data — and so inaccurate poverty lines based on wholly inappropriate criteria are being used to greatly overstate success in urban poverty reduction.

One puzzle here is the refusal to acknowledge that the costs of food and non-food needs vary not only between nations but within nations. When international 'experts' and consultants work abroad, they get daily allowances to cover their accommodation and living costs that are adjusted by country and by city or district within that country. This shows a recognition that daily food and non-food costs for such experts vary by up to five times depending on location. So why is there no such recognition accorded to low-income groups?

Next: Exploring Why Health Is So Poor Among the Urban Poor

Summarized from Urban Poverty in the Global South: Scale and Nature, by Diana Mitlin and David Satterthwaite, Routledge, January 25, 2013.

Part 3 of 6: Exploring Why Health Is So Poor Among the Urban Poor

Chapter 3 addresses the question of why health is so poor among low-income urban dwellers. We look at the very large health burdens associated with urban poverty, including very high infant and child mortality rates, large percentages of children malnourished, and large and easily prevented health burdens for children, adolescents, and adults. The causes, including very poor quality and overcrowded living conditions and the lack of provision for safe water, good quality sanitation, health care, schools, and emergency services, are in turn linked to local governments who may refuse to work with those living in informal settlements, even when they house a third or more of a city's population.

There are inadequacies in available data on illness, injury and premature death, provision for water and sanitation, and the impact on urban poverty of disasters. Again the inadequacy in official data on development is evident, as this relies so much on national sample surveys with sample sizes too small to reveal the inequalities within national urban populations or within individual cities. Urban averages for health-related statistics get pulled up by the concentration of middle and upper income groups in urban areas. This hides how low-income urban dwellers living in informal settlements can be facing comparable health problems to those faced by low-income rural dwellers — or, in some instances, worse health problems.

The concentration of people and housing in cities provides many potential agglomeration economies for health, as the costs per person or household served with piped, safe water, good quality sanitation and drainage, health care, schools, and the rule of law are lowered. But in the absence of a government capable of addressing these, this same concentration brings profound health disadvantages. In addition, the data collected in most nations on provision of water and sanitation provision do not show who has provision to a standard adequate for good health.

Next: Understanding the Informal Economy

Summarized from Urban Poverty in the Global South: Scale and Nature, by Diana Mitlin and David Satterthwaite, Routledge, January 25, 2013.

Part 4 of 6: Understanding the Informal Economy

To survive, the urban poor have to find work that provides a cash income. In urban contexts, all basic services are commodities that have to be purchased. Finding income-earning opportunities that are more stable, less dangerous, and provide an adequate return is central to reducing their poverty or moving out of poverty. Yet we actually know very little about the difficulties facing low-income urban dwellers in securing sufficient income and what would help them to do so. This is all the more remarkable when poverty is defined by income-based poverty lines.

In part, this lack of knowledge is because such a high proportion of low-income groups work in what is termed the 'informal' economy, on which little or no data are available. In part it is because the official data collected on employment has never been able to capture the variety, complexity, and diversity of income-earning sources, working conditions, and hours and their implications for health and income levels. But there are case studies that show the struggle of households to earn sufficient income (often involving children, too, and having to withdraw them from school), the often devastating impact of illness, injury, or premature death on household income, and the societal limits faced by women in labour markets (especially formal jobs other than low-paying maids). Of course, this is also part of a larger global picture where enterprises reduce their costs by employing temporary or casual workers (or day labourers) and drawing on suppliers and services from the informal economy.

There are a few detailed studies that provide us with insights into the difficulties faced by those working in the informal economy — for instance, the importance of social networks for getting employment and the more powerful local people who prey on street traders and other own-account workers or demand payment from them. For many households, the home has great importance as the location for income-earning work, too — especially for women. Case studies also show that street traders face increasing pressure in central city areas and may be forced out to peripheral (less profitable) places to trade.

We know remarkably little about the ways in which income circulates in low-income settlements and how this is influenced by relations with the wider city and the drivers of economic growth. There is also the way that intense competition for income-earning sources reduces returns. We also know remarkably little about what best supports low-income groups in getting higher incomes — although in particular case studies, among the factors highlighted are the availability of credit and being able to have a bank account, the extension of a reliable supply of piped water and electricity to the home (so useful for many income-earning opportunities), good social contacts, literacy, and the completion of secondary school.

Next: Concerning Inequality

Summarized from Urban Poverty in the Global South: Scale and Nature, by Diana Mitlin and David Satterthwaite, Routledge, January 25, 2013.

Part 5 of 6: Concerning Inequality

Most measures of poverty applied in low- and middle-income nations are for absolute poverty. They do not concern themselves with inequality. But it is not possible to understand poverty and its consequences without an engagement with inequality and what underlies it. Studies of inequality, like studies of poverty, also focus on income. They show that economic growth is often associated with growing income inequality, as demands for skilled workers push up wages at the top end of the salary scale and the low-paid cannot keep up. However, economic recession is also difficult for unskilled workers, who often face greater competition from the numbers looking for work. Yet many of the most dramatic (and unjust) inequalities are in relation to the other deprivations — housing and living conditions, access to services, the rule of law, and voice. These are also reflected in the very large inequalities in health status and in premature mortality that Chapter 3 documented.

It is clear that inequalities in access to infrastructure and services within cities also reflect inequalities in political power, voice, and capacity to hold government agencies to account and to access entitlements. In some nations, those living in settlements with no legal address cannot register as voters, while in most informal settlements residents face difficulties getting the official documents needed to get on the voter's register, access entitlements, and hold government or private service providers to account. In all nations, the inequalities faced by those living in informal settlements are reinforced by the stigma associated with living in these neighbourhoods.

Understanding these deprivations also requires attention to the spatial aspects of inequalities — i.e. inequalities between neighbourhoods and districts within cities; so often, the data collected on incomes, living conditions, or service provision is from too small a sample to show these spatial inequalities. An understanding of the many different factors that create or exacerbate inequality also means more routes by which inequality can be reduced.

There are also other aspects of inequality that throw light on deprivation — for instance, inequalities in household assets or capital, or inequalities caused or exacerbated by social or political status and relations, including discrimination. An understanding of inequality also needs to consider the implications for low-income groups of a larger and wealthier elite with the city — for instance, as their demands and influences restructure cities (and city planning) to serve their priorities. They can separate themselves from 'the poor' through gated communities and highways that link their homes, places of work, and places for leisure.

There are also some nations where governments have reduced some of the most profound inequalities among the urban population — for instance, through extending provision for water, sanitation, schools, and health care (and sometimes the rule of law) to a larger proportion of the low-income population, or through transfer payments that reach large sections of the low income population with supplements to their income, such as pensions, conditional cash transfers, and child allowances. Where these reach low-income groups, these certainly reduce absolute poverty — although they may not reduce income-inequality, as incomes may rise more among high-income groups. But these cash transfers also do nothing to address the inequalities in provision for infrastructure and services.

Next: What We Have Learned

Summarized from Urban Poverty in the Global South: Scale and Nature, by Diana Mitlin and David Satterthwaite, Routledge, January 25, 2013.

Part 6 of 6: What We Have Learned

So what has been learned from this review of urban poverty? That the scale and depth of urban poverty can be greatly understated if inappropriate poverty lines are used. That all nations need poverty lines that take into account the actual costs faced by low-income groups in regard to food and non-food needs and how these vary by location. And that all nations need a consideration of other aspects of poverty and what underlies them. Figure 1 lists the many deprivations associated with urban poverty and their immediate external causes.

For poverty specialists who have long focused on income- or consumption-based poverty lines, this broader view of poverty may be hard to understand. Many of its aspects are not easily measured. Many aspects may be considered to be state failures — mostly the incapacity or unwillingness of local governments to meet their responsibilities. And also the lack of attention to addressing this by aid agencies and development banks. But a broader understanding of poverty also means more entry points and more scope for intervention. City and municipal governments may have limited capacity to increase incomes for the poorest groups, but they have more scope and capacity to address other deprivations. This is also true for NGOs and for grassroots organizations.

If poverty is defined only by income or consumption, then little attention is given to the multiple roles that housing and its immediate surroundings (or neighbourhoods) can have in reducing deprivation — a point also emphasized by Figure 1 below. A focus only on income poverty can mean that a low-income household with a secure home with good quality provision for water, sanitation and drainage and with their children at school and access to health care is considered just as poor as a low-income household with none of these.

There is also the issue of what data are collected to inform government action on poverty. Is data available to inform governments on which residents, streets and neighbourhoods face the greatest inadequacies in the deprivations listed in Figure 1? Again the inadequacy of national sample surveys to give the detail needed to inform local action is evident.

Reducing urban poverty requires a functioning state in each urban centre or district that seeks to address its responsibilities. This is more likely if it is accountable to its low-income population. It needs this state to act in the public good. A companion volume to this book that will be published in mid-2013 explores what it takes to make the state act in ways that support at least some of the multiple routes to poverty and how the state can do so within the resources and capacities that are available. It considers how international agencies can learn how to support this — and how much this also means a need to work with and support representative organizations of the urban poor. And, also, the setting up of funding streams that are accessible to and accountable to the urban poor and their organizations.

Figure 1: Deprivations associated with urban poverty and their immediate causes

Summarized from Urban Poverty in the Global South: Scale and Nature, by Diana Mitlin and David Satterthwaite, Routledge, January 25, 2013.