What's New

The World Bank released some good news this month regarding extreme global poverty. In the report “Ending Extreme Poverty and Sharing Prosperity: Progress and Policies,” the Bank predicts that by the end of 2015, the number of people living in extreme poverty worldwide will drop from 902 million (the 2012 level) to 702 million, or 9.6 percent of the global population.

This week is the World Bank’s annual conference on development economics. One of the papers being presented is by my colleague Kate Orkin (together with co-authors Tanguy Bernard, Stefan Dercon and Alemayehu Taffesse) and takes a look at a video intervention and its impact on aspirations among poor folks in Ethiopia. In particular, what Kate and her co-authors are asking is: can we shift aspirations and behavior by showing people more of what is possible?

Extreme poverty and gender inequality are two of the most daunting challenges faced by the developing world. To tackle these challenges, many policymakers are turning to public works programs. Such programs can help governments provide stable, balanced wages to households in need, while at the same time investing in important infrastructure, like roads and irrigation systems, that can promote economic development in the future. But these programs are not without controversy.

The Minister of Finance of an African country needs to reallocate the country’s public investment to help achieve the Millennium Development Goals (MDGs) of halving the proportion of the poor and hungry by 2015: Should the minister increase investment in health and education, with the view that a future productive labor force can lift itself out of poverty? Or shift a greater share of the public budget to support agricultural productivity directly, as the vast majority of the poor relies on agriculture as their main livelihood?