Bee Stings and Poverty
Last night I read a good piece in the interesting Aguanomics blog. It comes from a recent article related to “The Persistence of Poverty: Why the Economics of the Well-Off Can’t Help the Poor” a book by Charles H. Karelis.
I found it thought-provoking and worth sharing with the NextBillion community:?
“When we’re poor, Karelis argues, our economic worldview is shaped by deprivation, and we see the world around us not in terms of goods to be consumed but as problems to be alleviated. This is where the bee stings come in: A person with one bee sting is highly motivated to get it treated. But a person with multiple bee stings does not have much incentive to get one sting treated, because the others will still throb. The more of a painful or undesirable thing one has (i.e. the poorer one is) the less likely one is to do anything about any one problem. Poverty is less a matter of having few goods than having lots of problems.”
“Poverty and wealth, by this logic, don’t just fall along a continuum the way hot and cold or short and tall do. They are instead fundamentally different experiences, each working on the human psyche in its own way. At some point between the two, people stop thinking in terms of goods and start thinking in terms of problems, and that shift has enormous consequences. Perhaps because economists, by and large, are well-off, he suggests, they’ve failed to see the shift at all.”
On my way to work I was thinking about the market-based approach to poverty alleviation discussed here in NextBillion, and whether or not it aims in the right direction when confronted with Karelis’ “bee stings” metaphor. I do believe that markets are effective mechanisms by which products and services can be made accessible to the poor, so they can make their choices and carve a way out of poverty.
However, market forces will only work properly if an effective state is in place and allows for a friendly and inclusive business environment. The lack thereof in most of the developing world is one of the issues keeping most of the BoP from escaping it, as argued in an excellent book I will be commenting here later this week.
Meanwhile, comments on Karelis’ views are welcome.