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Extreme Poverty
Extreme Poverty Overview
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Current Strategies

One of the main difficulties with current government programs is that they seek to reduce poverty through short term interventions that have a lasting impact. These are some strategies that have showed sustained impact.

1. Multifaceted household-level interventions [
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The idea is to assist families in multiple areas at the same time in order to lift people out of poverty trap - a state where your basic needs make it close to impossible to escape poverty.
This consists of six elements: (1) a productive asset grant, (2) temporary cash consumption support, (3) technical skills training, (4) high frequency home visits, (5) a savings program, and (6) health education and services.
They measure the effectiveness of this by running Randomized Controlled Trials (RCT). This evaluation technique consists in administering the policy intervention to a random group of individuals (the ‘treatment group’) and evaluating the effect by comparing outcomes against another group of individuals who were not affected by the policy (the ‘control group’). This is also the idea behind medical trials, and has become increasingly popular in development research.

2. Migration as a way to break out of extreme poverty [
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This consists of helping people leave rural regions where productivity is low and moving them to somewhere they can enjoy a higher standard of living
People are often reluctant to move because they are close to their goods. If you can insure them of their risk for moving, they are more willing to do so.

3. Giving people money – conditional cash transfers

Targeted transfer programs have become an increasingly popular policy instrument for reducing poverty in low-income countries. They are an obvious instrument to consider, since transferring cash is perhaps the most straightforward way of raising incomes; and when coupled with well-designed conditionalities, transfers can help ‘nudge’ participants who are caught up in ‘psychological poverty traps’.

4. ***(Interesting to look into) Offshoring of low-skilled jobs

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Growing international trade has changed our world drastically over the last couple of centuries
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. One particular effect has been a substantial increase in the demand for industrial manufacturing workers in low income countries, mainly due to the rise in offshoring of low-skilled jobs. A common argument put forward is that these industrial manufacturing jobs are a powerful instrument for reducing poverty, even if salaries tend to be very low by the standards of rich countries.
A more careful analysis of the argument reveals a complex reality. On the one hand, low skilled industrial jobs do provide a formal, steady source of income, so it is possible that they raise incomes and reduce poverty. Yet, on the other hand, these jobs tend to be unpleasant and very poorly paid opportunities even by the standards of low income countries.
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