How do you “end poverty” in the developing world? Well, certainly not by promoting a “poverty agenda” that has proven to be a failure again and again. The two items below both appeared yesterday. The first is from a review of “The Elephant and the Dragon,” a book by Robyn Meredith, a Hong Kong-based correspondent for Forbes magazine. The second is from a commentary by the chairman of Microsoft India in the Wall Street Journal (reg. req’d).
As Ms. Meredith shows, comprehensive, market-oriented reforms — China’s began in 1978, India’s in 1991 — have sparked a new dynamism and remarkable economic growth. In the 1990s alone, more than 200 million people escaped poverty in the two countries, lifting the per-capita standard of living beyond the wildest dreams of previous generations. “We got more done for the poor by pursuing the competition agenda for a few years,” says one of India’s former finance ministers, “than we got done by pursuing a poverty agenda for decades.”
– “The Boom Beyond Our Borders”. By Matthew Rees. OpinionJournal.com
Lifting hundreds of millions of people out of poverty cannot happen through “corporate social responsibility.” Important as these initiatives are, they are neither sustainable nor scalable, and therefore achieve limited impact. Nor will poverty be overcome through the “bottom of the pyramid” initiatives that seek to make the poor into bigger consumers of shampoos and televisions by enabling them to pay per use.
We need a new approach driven by innovation. We need to focus less on doing small, nice deeds for the poor, and less on selling them affordable versions of what rich people consume. Instead, we must marshal the best resources of big, innovative corporations to think freshly about the shackles that keep people poor and invent solutions that break these shackles.
– “Innovate for India’s Poor”. By Ravi Venkatesan, Wall Street Journal