Presentation on theme: "Sustainable Livelihoods and Poverty Reduction"— Presentation transcript:
1 Sustainable Livelihoods and Poverty Reduction Joseph Assan, PhDSchool of Natural SciencesTrinity College DublinDublin, Ireland
2 Definition of Sustainable Development In 1987 Brundtland report “Our Common Future” defined sustainable development as “development that ‘meets the needs of the present generation without compromising the ability of future generations to meet their needs’ (WCED 1987).
3 What is Political Economy Political economy originally was the term for studying the economics of: production, buying, and selling……and their relations with law, custom and government ……as well as with the distribution of national income and wealth through the budget process of the state or international institutions.(Gregg et al. 2007)
4 Contemporary Political Economy …examines how political forces affect the choice of policies, distributional conflicts and political institutions… The political-economy literature argues that economics alone cannot fully explain the enormous variance across countries in growth and more generally, in economic outcomes and policy choices… Political-economy concepts assert that economic policy is the result of political struggle within an institutional structure with state and none state actors.. Source: Alisina, A. and Perotti, R. (1994)
5 The UN High Panel (2012) calls for a New International Political Economy of Sustainable Development
6 Multi-disciplinarity & Trans-disciplinarity of Political Economy of International Sustainable DevelopmentMulti-disciplinary&Trans-disciplinaryEconomics, Mgt, Business etcAnthropology & SociologyEnvironment, Theology etcTechnology, info studiedSustainable International DevelopmentPolitics and LawAgricultural and rural studies etc.Development StudiesGeography, policy Studies
7 Political Economy of International Sustainable Development:
8 Whose impact?There is mounting evidence that Livelihood Diversification (embracing both farm and non-farm employment) activities have become an important resource for households (Reardon 1995; Reardon et al. 1998).A livelihood is sustainable when it can cope with and recover from stress and shocks and maintain or enhance its capabilities and assets both now and in the future, while not undermining the natural resource base (Carney 1998).
9 Livelihoods Assets Human Capital Social Capital Natural Capital The PoorPhysicalCapitalFinancialCapital
10 The Sustainable Livelihoods Framework PHThe PoorVulnerabilityContextShocksSeasonalityTrendsChangesinfluencePoliciesInstitutionsProcessesLivelihoodStrategiesLivelihoodOutcomes
11 Micro-foundations of Development Understand the behaviour of state and non-state actors (decentralised government institutions, civil society groups and households)Identifying the constraints and barriers to sustainable livelihoods diversification, growth within micro economiesDevelop policies that will help inform policy makers as to how to reduce inequality11
12 Do rural households diversify for survival or wealth accumulation? Diversification is a strategy for survival.A source of insurance against indebtedness and borrowingThe amounts saved are observed to be smallCapital for non-farm activities/consumptionStill do not enjoy income securityDiversification meets basic consumption needsMajority borrow regularly or occasionally
13 Income shocks and household risk coping mechanisms Policy Implications:Vulnerability to shocks is a dominant feature of household livelihoodsNegative effect on welfare (income,wealth, health, etc.)Vulnerability to povertyKey challenge is maintaining satisfactory confidence on young people in the development dream
14 Does livelihood diversification reduce economic risk effectively? Diversification is not able to provide risk-free and assured incomesThe production of new products and/or more output of already existing studiedMost households and end up in financial crisisRaise some of their credit from friends and family and network groups such as susu groups
15 Does livelihood diversification reduce economic risk effectively? Patterns of risk aversionintroduction of new risksfailure to remove existing risksproducts encounter the challenge of marketingprevalence of incomeborrow in order to finance their diversified enterprises
16 Income shocks and household risk coping mechanisms Policy implications:Mechanisms to reduce the uncertainty associated with income generating activities will have welfare enhancing effectsCould be achieved through extending existing formal insurance contracts and avenuescover weather related risks
17 Livelihood Diversification and Poverty Reduction:… …are we on Course??
18 Conclusion: Livelihood Diversification Opens new Economic PathwaysSurvival rather than accumulationRisk proneWithin the community/DistrictCreates gender differentiationIncome and Market differentiationPoverty ReductionNon-uniformity of outcomes of diversificationWealth disparityWage labour productionMarginal and compulsive alternativesThrives on social capitalLivelihood SustainabilityRequires empowerment of state actorsRequires formal institutional supportDemands budgetary frameworks18