The Challenge of Poverty

Absolute poverty has declined over the years, both at the national and provincial levels. It is, however, deep and severe when looked at from multidimensional approach. It is argued that it is important to have an understanding of the lives, including mental lives, of the poor for evidence-based interventions for poverty alleviation. Accordingly, empirics on poverty in the light of findings of RCTs and research studies conducted by Banerjee and other economists are highlighted. The pros and cons of various approaches to poverty alleviation like microcredit and cash transfers, both unconditional and conditional, are discussed. Financial inclusion is also discussed as a strategy of poverty alleviation. Findex data for the South Asian countries is analyzed which indicates that Pakistan is at the bottom against various financial inclusion indicators. Overall, it is suggested that said schemes do not have a transformative effect on poverty alleviation. Evaluation of Pakistan’s Benazir Income Support Program (BISP) also confirms said assertion. The traditional poverty alleviation schemes generally help consumption smoothing. A big push is needed through boosting economic growth, distribution of productive assets like land, and better public service delivery.