Ending poverty in all its forms everywhere is the first Sustainable Development Goal (SDG) of the United Nations (2021a). Progress towards this goal has varied but also been fruitful. Between 1990 and 2015, over a billion people were lifted out of extreme poverty (World Bank 2018). From 36% of the population under extreme poverty in 1990 to 10% in 2015 (United Nations 2021b). The world achieved the first Millennium Development Goal (MDG) target of reducing the poverty rate from 1990 by half in 2010, five years ahead of the year 2015 (United Nations 2020). The poverty rate fell to approximately 9% in 2018 (World Bank 2020b). These efforts reaffirm the commitment of the vital international body and the nations within it to prioritize resources for poverty alleviation. .
However, with the emergence of COVID-19 and other challenges, the world is experiencing some of the worst setbacks in decades. According to the Poverty and Shared Prosperity 2020: Reversals of Fortune report, COVID-19 will substantially impact poverty alleviation efforts, with up to 150 million added into extreme poverty by 2021 (World Bank 2020a). However, United Nations University World Institute for Development Economics Research (UNU-WIDER) estimates the figure to be up to half a billion people. This has resulted in poverty rising globally for the first time since 1990 (United Nations 2021b).
Eight of the ten new poor are expected to be from middle-income countries, estimated to be between 119 and 124 million (Lakner et al. 2021). The United Nations (2021a) had projected prior to COVID-19 that the total population under extreme poverty by 2030 would be 6%, thereby missing the target of having no more than 3% living on less than 1.9 USD
a day (World Bank 2020b).
Efforts with direct and indirect effects on poverty have been underway for decades. Most of them were in the developing world. Large countries, including China, Brazil, India, and Russia, are among the high-middle-income and low-middle-income countries, representing the highest numbers in poverty globally, whilst also being the most vulnerable to poverty, considerably so under COVID-19. In 2020, China declared success in eliminating extreme poverty within rural regions. These efforts reflect a strong commitment of leadership, institutions, and society to overcome poverty. Medium and small countries such as Tanzania, Ethiopia, Vietnam, and Mongolia have also made strides. There are leading examples of moderate to highly successful poverty alleviation programs among all these and other countries.
In spite of these efforts, the goal of eliminating poverty remains ambitious for several reasons. The concept of poverty itself has evolved with time from an economic-only to a multidimensional form, influenced by the dynamics of poverty and society.
The developing world is seeking greater insight, pioneering solutions, and collaboration in addressing extreme poverty. In reaching this goal, the Journal of Integrative Agriculture (JIA) has organized a special issue of “Paths out of Poverty” with a comprehensive review of the developing world in its fight against extreme poverty. Enabling the developing world to share knowledge, learn from experience, and identify opportunities to collaborate with each other as part of the global initiative to achieve the first Sustainable Development Goal of the United Nations.
Paths out of poverty is an inclusive platform with an extensive review of wide-ranging poverty alleviation efforts across the world comprising of China, Mongolia, Brazil, Russia, India, Vietnam, Tanzania, Ethiopia, and others. This special issue consists of twenty papers across four sections, encompassing poverty governance and international experience, poverty alleviation through industrial development, innovation and inclusive development for poverty alleviation, and poverty alleviation through social safety net programs.
Section 1: Poverty governance and international experience
Governance is a key determinant of success in poverty alleviation. Research from developing countries in Africa, Asia, and Latin America validates this view as we examine their experience.
Fan and Cho (2021) reviewed international efforts to achieve the first SDG. With agricultural development as the paper’s focal point, they emphasize its critical role in paths out of poverty. In Africa, agricultural growth is led by land expansion, and poverty alleviation has been the slowest. In South Asia, agricultural growth is driven by the diversification of smallholder agriculture, and this has had a significant impact on poverty alleviation, though limited by rural–urban migration and job creation. Latin America is increasingly focused on social protection programs. In East Asia, China’s success was founded on agricultural reforms and rural development, which raised incomes and food availability at affordable prices. Further, there was increased investment in nutrition, health, education, water, and sanitation.
The key lesson is that in land-scarce countries, smallholder-led agriculture growth can have the largest positive impact on poverty alleviation. Non-farm employment and rural–urban migration must follow once agricultural productivity has reached a certain level, though a pre-mature exit may cause greater harm. Prior to the exhaustion of large-scale sectoral and regional development for poverty alleviation, social safety net must be established to support those not benefitting from this transformation. Productive social safety nets have proven to be cost-effective in many countries and should be inclusive of urban poverty as rural residents migrate to urban areas.
Díaz-Bonilla and Constenla-Villoslada (2021) broadly illustrated the complexity in the differing debates of approaches adopted for paths out of poverty, from a microeconomic perspective on policies aimed at poverty alleviation such as the Randomized Control Trials (RCTs) to more systemic perspectives of growth and development strategies, and macroeconomic policies as associated with poverty alleviation. This paper provides readers a very informative and comprehensive overview of poverty approaches, institutions, and their policy decisions as well as enforcement.
Implementing decentralized targeted poverty alleviation (TPA) program in developing countries successfully can often face the challenge of elite capture. One such was China’s TPA policy, which was later enhanced with a targeting correction mechanism called “follow-up checks” policy to exclude elite capture influences and other ineligible households (Cheng et al. 2021). Two years after introducing this mechanism, no evidence of elite capture in TPA program was discovered, in sharp contrast to findings from TPA prior to the mechanism having been introduced.
Leng et al. (2021) analyzed the impact of the PAR program on rural household income and the income effects on varied modes of relocation. The results show PAR increases the income of both rural and urban resettlers and, in particular, has a significantly positive effect on agricultural and wage income. This was attributed to agricultural technology training for rural resettlers and medical security for urban resettlers. The author concludes that policies should focus on strengthening local industries’ development and training of agricultural technologies for rural resettlers, non-agricultural employment and public services in resettlement areas for urban resettlers.
Infrastructure for transport such as highways improves living conditions and contributes to poverty alleviation. While most studies have focused on income distribution effects, few have assessed farmers’ resulting income gap. Weng et al. (2021) used a fixed-effect model to test this impact and discovered a U-shaped effect among provinces. National and provincial trunk highways helped to narrow the income gap of farmers. The level of education, productive fixed assets investment, urbanization, and regional economic development also had varied effects on the income gap. Finally, a U-shaped relationship between highways and the income gap of farmers was identified.
Section 2: Poverty alleviation through industrial development
Industrial development, a large-scale and organized effort combining government, business, technology, and labor has effectively delivered economic growth and poverty alleviation in major developing economies such as China.
Liu M Y et al. (2021) emphasized industrial development as integral to the “Five-pronged Poverty Alleviation Measures” policy of targeted alleviation adopted by China to achieve the Chinese dream. The author evaluates the effects and measures farmers’ livelihood based on the framework of sustainable livelihood by employing propensity score matching combined with difference-in-differences (PSM-DID) approach. Industrial development had a positive effect of the farmers’ livelihood capital, including human, social and financial capital, whilst not having a significant effect on natural and physical capital. However, the effects indicated a greater impact on the non-poor than the poor, and the effects varied based on the region.
Chen et al. (2021) focused on financial support through formal credit and its effects on rural household income. The results show a significant increase in rural household income in deprived areas of western China. Formal credit can promote reallocation of labor from the agricultural to the non-agricultural sector in a household and influence investment-consumption behavior. However, formal credit may have widened inequality in rural households of western China. Variation in characteristics and capital (material, human and social) can fluctuate the effect of formal credit on income growth.
Li et al. (2021) highlighted two phenomena of off-farm employment and poverty alleviation in rural China, with the impact on the latter by the former by linking them together to find correlation. Assessment indicates when household participation in off-farm employment increased by 10 percentage points, the likelihood for a non-poor household to fall into poverty decreased by 0.88 percentage point, whereas the likelihood for poor household to climb out of poverty increased by 3.5 percentage points. Therefore, off-farm employment not only prevents fall into poverty but assists in climbing out of it.
Many regions in Africa are drought-stricken, and irrigation systems are scarce. Existing facilities run by farmer cooperatives are considered unsuccessful and dysfunctional in Tanzania by many researchers. The fourth paper by Zhang et al. (2021) looked at a cooperative irrigation scheme that has some government intervention and external support. Upon investigating the management and services of this scheme and analyzing its contribution to poverty alleviation, the following was observed. The scheme faced several challenges due to constraints in resources, institutions, and low-level of human capacity in both management and members. However, the results indicated the scheme enhanced smallholder farmers’ rice production, market opportunities, and net income. The profit improved the livelihoods of smallholder farmers and led to greater employment opportunities in rural communities.
Section 3: Innovation and inclusive development for poverty alleviation
Global value chains, accounting for 50% of the trade worldwide, give rise to close coordination between buyers and suppliers, and their higher value-added activities. They are contributing to poverty alleviation. Under these incentives and the new norms of economic development, innovations in digital opportunities, including e-commerce value chain, agricultural technology innovation, and ecological value chain for sustainable development in vulnerable regions are analyzed.
Vos and Cattaneo (2021) observed urbanization, rising incomes, and changing diets have contributed to the expansion of food markets in Africa and South Asia. This has offered vast opportunities for raising income and job security along food supply chains, and as a consequence, poverty alleviation. The spread of COVID-19 necessitates interventions that enhance the resilience and inclusiveness of food systems. The authors assess how this may be achieved with better functioning and interconnectedness of small and medium-sized enterprises and how policies can help smallholder farmers connect in more rewarding ways and pull them out of poverty.
Digital technologies, including e-commerce, have presented opportunities and become a key driver in addressing developmental challenges such as poverty in rural and remote areas. Haji (2021) reviewed the role of e-commerce across the BRICS countries and their growing prominence to facilitate rapid, inclusive, and sustainable economic growth, which improves living standards and alleviates poverty. The author explored areas for cooperation in e-commerce within the BRICS countries, e-commerce development across rural and remote areas, public and private initiatives supporting this, and evaluating existing challenges and risks. The analysis indicates disproportionate e-commerce use across regions and limited cooperation within BRICS. Further, recommendations are made to overcome the observed challenges and risks.
Peng et al. (2021) investigated the effect of rural e-commerce on rural income based on village-level survey data from rural regions. An inverted U-shaped relationship was identified on the impact of rural e-commerce with the robustness test of the propensity scores matching. This indicates the importance of policy support in rural e-commerce in poor villages. Meanwhile, investment in Internet infrastructure and enabling human resources of potential e-commerce players in rural areas will have spillover effects. Finally, the authors conclude that if the digital divide were bridged, rural incomes could see an increase through the digital dividend.
Wang et al. (2021) examined the consumption side of e-commerce and focused on Chinese consumers’ online ethical consumption. The authors designed a within-subject survey and a between-subject survey to investigate Chinese consumers’ quality perception and preference for apples from poverty-stricken areas using the payment card elicitation method. The “information shock” analysis reveals that the ethical attribute is the primary motivation for buying apples from poverty-stricken areas. The quality perception of private attributes has a significant effect on consumers’ willingness to pay (WTP) for apples from poverty-stricken areas, and trust in government supervision of e-commerce plays an essential role in motivating online ethical consumption.
Agricultural technologies can dramatically improve agricultural productivity, confront climate change challenges, and ultimately raise incomes as well as uplift rural households from poverty. Africa has been experiencing a surge in smart agriculture technologies adoption, which contributes to a reduction in poverty, covering row planting methods and the use of chemical fertilizers on multidimensional poverty in rural households of Ethiopia. The results in Habtewold (2021) showed a reduction in overall and living standard deprivations. There were regional variations in the extent of reduction in deprivation, such as in the Amhara and Oromiya regions of Ethiopia, with greater impact in severely deprived households. Effect on multi-dimensional poverty was channeled more through non-food expenditure.
Ecological degradation and poverty are in a vicious cycle that needs to be broken. Ecological poverty alleviation (EPA) can overcome these dual goals. EPA is a complex system of multiple policy instruments, government agencies, social forces, and agents. Lei et al. (2021) illustrated key elements of the system and their relationships to fulfil this vital role, particularly establishing the routine for communication among agents, internal elements of the subsystem, and the relationship between them to give a picture of the system’s operating mechanisms.
Section 4: Poverty alleviation through social safety net programs
Poverty is associated with lower health, education, and other human capital empowerment aspects. Policies and practices can influence this relationship significantly. Innovation in social safety nets can target poor and vulnerable households more effectively to lower inequality and reduce poverty. It is also an effective mechanism to build resilience in volatile times and support countries’ rapid development.
Yu and Li (2021) evaluated the effect of expenditure on the social safety net in reducing income inequality and rural poverty with China’s national statistical data on social insurance, social assistance, and social welfare in the period 1978–2018. A positive but limited correlation between social security expenditure and the income gap of urban and rural residents was found. Social security expenditure is helpful in reducing rural absolute poverty with an elasticity of –0.2255 on rural poverty incidence to social security expenditure. This paper also recommends that social safety net should become one of the major anti-poverty strategies after 2020 in China in the relative poverty era.
Qin et al. (2021) assessed the New Rural Cooperative Medical Scheme’s (NRCMS) impact on rural households’ health-focused poverty alleviation in China. The data indicated that the hospitalization of family members is a key factor for falling into poverty, and the NRCMS has reduced this risk. The impact of NRCMS varied among groups with differing levels of income, with the least affected being the middle-high and high-income groups. Regional differences were also evident in the impact of NRCMS, with greater impact on western regions and non-significant on central and eastern regions. The author proposed raising the compensation ratio of the NRCMS, reform payment methods, developing a comprehensive healthcare system, strengthening medical security for the poor in remote areas, and enhancing the living environment for rural residents.
Bai et al. (2021) studied the intergenerational transmission of poverty in rural China by estimating transmission of earnings with a perspective of human capital investment before the children enter the labor market. The study discovered substantial transmission of earnings in rural China, especially between the pairs of father–children and parents–children. The intergenerational earning elasticity, which was lower than urban areas, indicated better social mobility in rural areas. Children with higher-income parents achieved high levels of education and skills. Further, human capital investment in children prevented the intergenerational transmission of poverty and promoting social mobility.
Gu and Nie (2021) analyzed the effect of a multi-component program on women’s empowerment, and consequentially, household poverty in Inner Mongolia of China. The paper employed a number of methods to ensure the robustness of the results, which indicated positive effects on both women’s empowerment and poverty alleviation, raising incomes and living standards of households. Gender-focused programs, which included training, micro-finance, and associations, aided the outcome. The author further concluded that researchers and policymakers needed to pay greater attention to poverty alleviation from the perspective of gender.
Liu X H et al. (2021) assessed the impact of clan culture, an informal institution, on the rural elderly’s mental health, an important group that relies on welfare programs. The study found that clan culture can significantly decrease depression in rural elderly, though these positive effects were gradually weakened with economic development. Mechanisms assessed against these effects in clan culture indicated stronger social support.
Conclusion and perspective
There are many facets of poverty. These are dynamic and systemic in nature. They may be a consequence of natural disasters and various crises such as the COVID-19 pandemic, climate change, and trade frictions.
The most urgent priority for governments and international organizations at present is defeating COVID-19 and reviving economies. However, this experience demonstrates the broad spectrum of threats posed to sustaining livelihoods, including preventing and managing those related to health. Events such as these will undoubtedly influence the models that target poverty.
In this environment, social protection systems and digitization of services accessible to all that can sustain livelihoods have become key. These systems are in place across most developed countries, whereas developing countries are building or expanding them. Brazil and Indonesia, in particular, are looking to expand cash transfer programs further.
Current trends indicate efforts need to be elevated and accelerated with greater cooperation and collaboration among countries and institutions of both developed and developing countries. First, to invest, prepare, prevent, and manage threats to poverty alleviation. Second, and more importantly, to enhance poverty alleviation programs. Pre-pandemic data indicated that the 2030 SDG of poverty would not have been achieved (World Bank 2020b).
While there are concerns in reaching the 2030 target for extreme poverty alleviation, which is estimated to have been pushed back further, the prospects for poverty alleviation remain positive in the long-term.
The world has no meaningful alternative to tackling poverty which is detrimental to the development of humanity. It is humanity that must collectively rise to this challenge with innovation in technologies, policies, systems, and programs. Cooperation and coordination will be essential for innovating, building as well as implementing capacity and resilience to effectively eliminate extreme poverty and sustain livelihoods.
This is the aim of this special issue, which highlights key experience and effective approaches to poverty alleviation to be shared among countries. The case of China, which has experienced success at a number of approaches, including industrial development, health, education, governance, overcoming intergenerational transmission of poverty, and building digital systems and e-commerce value chains, presents unique insight. Studies in this special issue confirm the achievements of these approaches.
Further, Africa has witnessed growth through effective adoption of agricultural technologies; Brazil has made advancements in social protection; BRICS countries are increasingly focused on digitizing services and building e-commerce value chains. With its rising urbanization, South Asia has created opportunities and job security in food supply chains and positively contributed to poverty alleviation. Finally, ecological value chains hold irreplaceable value, provide underlying support, and improve poverty alleviation programs with institutional support.
Therefore, the developing world has much to offer, learn and implement in poverty alleviation. We must cultivate mechanisms that contribute to the goal of poverty alleviation as this special issue on Paths out of Poverty seeks to achieve.
We acknowledge the considerable support extended to this special issue by Prof. Fan Shenggen from China Agricultural University, Prof. Wu Bin from University of Nottingham, UK, and former Advisory Committee of State Council Leading Group Office of Poverty Alleviation and Development. We also thank all the authors for their contribution, Ms. Weng Lingyun, the editor of this special issue, for her guidance and management, and credit the National Natural Science Foundation of China for its financial support (71661147001).