Solutions To Poverty Essay

Poverty is a stochastic phenomenon. Today’s poor may or may not be tomorrow’s poor. Currently non-poor households, who face a high probability of a large adverse shock, may, on experiencing the shock, become poor tomorrow. And hence, the current poverty level of a household may not necessarily be a good guide to the household’s vulnerability to poverty in the future. For thinking about appropriate forward-looking anti-poverty interventions, the critical need then is to go beyond a cataloging of who is currently poor and who is not, to an assessment of households’ vulnerability to poverty (Chaudhuri, 2003). In the extant literature either income or consumption expenditures as measured over short periods of time has been regarded as a proxy for the material well-being of households. However, economists have long recognized that a household’s sense of well-being depends not just on its average income or expenditures, but also

There fore vulnerability is the best measure of welfare. Addressing vulnerability is not a locked door any way. It has been proved beyond doubt that SHG's intervention can make a big change in living standards, through regular savings, improved level of family earnings, expanded assets, and better socio/political access thereby reducing vulnerability and poverty contributing to a wide range of development goals (Anand S., J, 2004). Providing poor people with effective financial services helps them deal with vulnerability and can thereby help reduce poverty (Matin, Hulme and Rutherford, 2002). Morduch (1998), is also evidenced from his assessment in Bangladesh that; the most important potential impacts of participating in self help based micro-financing institutions are associated with the reduction of vulnerability, not of poverty per