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Nature of Rural and Urban Poverty and the Challenges with Reducing Poverty in Rural and Urban Areas

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COMPARE THE NATURE OF RURAL AND URBAN POVERTY AND THE CHALLENGES ASSOCIATED WITH REDUCING POVERTY IN RURAL AND URBAN AREAS.

 

INTRODUCTION

Poverty is still and will be a crucial problem nowadays. Van der Ploeg (2012) stated around 1.4 billion people are living in the extreme poverty with income less than US$1.25 per day. The numbers of poverty in the rural areas are higher than poverty in the urban areas. Based on the calculation of the World Bank data, the number of poverty in the rural areas are 42 percent in 2010 and the number of poverty in the urban areas are 23 percent in the same year (Sridhar, 2015). This finding is in accordance with that of Van der Ploeg (2012) which mentioned that, approximately, 7 out of 10 impoverished people were living in the rural area (Van der Ploeg, 2012). Interestingly, the number of urban poverty gradually increased during recent years (Sridhar, 2015).

World Health Organization (2015) calculated 54 percent of the population in the world lived in the urban areas. WHO projected the number of people living in the urban areas will increase from 54 percent in 2015 to 60 percent in 2030 and to 66 percent in 2050. People in the urban area are increasing because of the natural growth of the population and as an impact of the urbanization (Floro and Bali Swain, 2013). The increasing population in the urban areas bring impact to the rise of the poor people in the cities (Satterthwaite, 2003). Furthermore, the increasing of urban poverty rise the ratio of urban poverty to the total poverty rate (Sridhar, 2015).

“During the next 20 years, the urban population of the world’s poorest regions—South Asia and sub-Saharan Africa—is expected to double. Thus, while in absolute terms, globally, the rural population will soon be less than the urban, the number of urban poor is increasing. It is obvious that growth in the urban population implies further increases in the number of urban poor, even if urban poverty rates remain constant.” (Sridhar, 2015: 96).

Having mentioned the numbers and trends, the nature of rural and urban poverty has similar and interrelated issues to tackle. The issues on the nature of poverty then leads to challenges associated to poverty reduction. The discussion in this essay thus predominantly focuses on interrelating issues, namely: 1) the land use and ownership, and 2) education and unemployment. This study aims to shed some light to revisit the poverty reduction challenges in both rural and urban areas and thus elucidate the more urgent issue to focus on.

COMPARISON OF THE NATURE OF RURAL AND URBAN POVERTY

Poverty in rural and urban areas have different natures. This section will discuss the comparison of the natures of the poverty in the both areas.

 

Rural Poverty and

The numbers of poverty in the rural areas are higher than poverty in the urban areas. Based on the calculation of the World Bank data, the number of poverty in the rural areas are 42 percent in 2010 and the number of poverty in the urban areas are 23 percent in the same year (Sridhar, 2015). This section will discuss the nature of poverty in the rural area. The discussion heavily focuses on the dependency of agriculture, the important of land, and the lack of infrastructure and public services.

Food and Nutrition Problems

The food security and nutrition issues still be a crucial problem in the world. Joffe (2017) argued the portion of the people who live with hunger, lack of food security, and inesuffient nutrition has declined during recent years, but the numbers remained high. In some cases, the number of people have enough supply of food but suffer micronutrient deficiencies (Joffe, 2007). Based on the UNICEF (2017) data, 50 percent of all under five children mortality are caued by lack of nutritions or approximately 3 million death a year.

Most of the cases happened in the rural area. Regassa and Stoecker (2012) listed the factors that make people in rural areas suffer high risk of hunger that are the low rate of agricultural practice, lack access to the productive resources, no access to the land, limited education, poor storage technology to keep farming production, lack of public transportation, double burden to the women, high rate of unemployment, misuse of food charity, social barrier, and lack access of healthcare.

The hunger people still be a major case in the rural poverty in Africa and South Asia. Patnaik (2010) stated people in rural area who suffer undernourished (based on the official nutrition norm of 2,400 kilocalories per day) increase between 1993-1994 and 2004-2005 in India. In addition, rural residents who cannot reached 2,200 calories per day increased from 74.5 percent in 1993-1994 to almost 87 percent in 2004-2005 (Patnaik, 2007). The undernourished problem in India led to the productivity reduction.

 

High Dependency of Agriculture

Van der Ploeg (2012) stated around 980 million poor people live in the rural area. Poor people in the rural area mostly depend on the agriculture sectors as a major source of income (Bardhan, 2006; Van der Ploeg, 2012). The poor people have no other source of income and access to the employment outside the agriculture sectors. The highly dependency of the agricultural sectors make people in the rural area are more vulnerable since the productivity of agriculture decline as the result of the degradation of the environment. In addition, the ownership of land beame smaller in the recent years decrease the farming productivity. Land conversion become the major cause of the land degradation (Barbier, 2000).

Urban Poverty

World Health Organization (2015) calculated 54 percent of the population in the world lived in the urban areas. WHO projected the number of people living in the urban areas will increase from 54 percent in 2015 to 60 percent in 2030 and to 66 percent in 2050. People in the urban area are increasing because of the natural growth of the population and as an impact of the urbanization (Floro and Bali Swain, 2013). The increasing population in the urban areas bring impact to the rise of the poor people in the cities (Satterthwaite, 2003). Furthermore, the increasing of urban poverty rise the ratio of urban poverty to the total poverty rate (Sridhar, 2015).

“During the next 20 years, the urban population of the world’s poorest regions—South Asia and sub-Saharan Africa—is expected to double. Thus, while in absolute terms, globally, the rural population will soon be less than the urban, the number of urban poor is increasing. It is obvious that growth in the urban population implies further increases in the number of urban poor, even if urban poverty rates remain constant.” (Sridhar, 2015: 96).

This sub-section will heavily focus on the nature of urban poverty. The discussion will focus on the problems related to the non-food needs such as housing, water and sanitation, transport, fuel, electricity, healthcare, and education. Furthermore, the urban sub-section also discusses about the social political problems such as high risk of criminality, social fragmentation, social and political exclusion.

The Non-food Problems

Unlike the food problem that still be nature of poverty in the rural area, poverty in the urban area are mostly because of the non-food problems such as housing, water and sanitation, transport, fuel, electricity, healthcare, and education. Satterthwaite (2003) stated more than 600 million people in the cities in the Asia, Africa, and Latin America live in the dangerous shelters and neighbourhoods because of the overcrowded housing, unsafe water supplies, bad sanitation, drainage, and garbage. Most of this population live in the temporary building illegally (Satterthwaite, 2003). The fact is correlated with the World Health Organization (2015) data that calculated approximately 51 percent of urban households have low access to the clean and safe water.

In the term of education, the education can be both the cause and effect of the poverty in urban area. The lack of education lead to the poverty. It means the children that born in the poor families and have not access to the education will live in the poverty circle (Mihai, Ţiţan and Manea, 2015). Rodriguez and Smith (1994) stated the rate of education is a key point that has largest effect to the probability of people living in the poverty. This effect of the education to the probability people living in the poverty is higher in the urban areas than in the rural areas, especially in the farming household (Rodriguez and Smith, 1994).

People in the urban areas live in the poor neighbourhood because they have low income. The majority of the poor people in the urban areas work in the informal sectors, earn low income, and have no access to the social insurance (Floro and Bali Swain, 2013). Rodriguez and Smith (1994) argued the increasing the number of household income effectively reduce the probability of people living in the poverty. In addition, the type of jobs such as the permanent jobs in the formal sectors also reduce the probability of people living in the poverty (Rodriguez and Smith, 1994). The number of income is highly related to the rate of the education.

 

Urbanization

Urbanization is a major phenomenon in the third-world countries. However, the data of urbanization are badly documented in the developing countries (Capps, Bentsen and Ramírez, 2016). World Health Organization (2015) stated the number of population in the urban areas will gradually increase from 54 percent in 2015 to 60 percent in 2030 and 66 percent in 2050. Floro and Bali Swain (2013) argued the migration from rural areas to the urban areas are the major explanation behind this phenomenon. People from the rural areas migrate to the urban because the low employment in the rural areas. The people migrate to the urban area without sufficient skills, so they trapped in to the low-skills jobs with the low income. The increasing population in the urban areas bring impact to the rise of the poor people in the cities (Satterthwaite, 2003). As mentioned above, it makes people live in the dangerous neighbourhoods with the lack access to the decent housing, clean water, sanitation, education, and healthcare.

The problems continue when the city governments refuse to register the rural residents who live in the cities as the official residents. In this condition, the rural residents who live in the cities become more vulnerable because they cannot access the social programs such as public insurance and free education. In China, the city governments refuses to register a millions of rural migrant who live in the urban areas and thus they cannot access the formal jobs and social programs (Wu, 2004).

 

Social and Political Problems

The nature of poverty in the urban areas also related to the social and political problems such as high risk of criminality, social fragmentation, social and political exclusion. These problems rarely found in the rural poverty. The people who live in the poverty line face the high risk of criminality. Becker (1968) stated the poverty and income inequalities correlate positively to the rate of criminality. The rate of criminality is higher in the poor neighbourhood. the research of Scorzafave and Soares (2009) meet the similar conclusion. The income inequalities correlate positively to the rate of pecuniary crime such as hijacking, shoplifting, fraud, burglary, robbery, and drug trafficking.

Social and political exclusion also lead to the poverty. Pringle and Walsh (1999) argued the social exclusion make people lose their ability to participate fully in the social and economic activities.

“Social exclusion tends to refer to the process whereby individuals become deprived, though it can also refer to a sate which goes beyond deprivation by implying an inability to participate fully in social and economic activities, including those which influence decision making.” (Pringle and Walsh, 1999: 3).

The inability of participation in the social and economic activities make people have no access to the source of income. As a result, it led to the poverty and income inequalities. One of the type of social excursion is discrimination. Discrimination blocks individuals to have access to the exchange mechanism and cause the poverty and income inequality (Gangopadhyay, Shankar and Rahman, 2014).

 

THE CHALLENGE ASSOCIATED WITH REDUCING POVERTY IN RURAL AND URBAN AREAS

The difference nature of rural poverty and urban poverty bring challenge associated with the reducing poverty in the both areas. This section will discuss these challenge that highly focus on the two points that are the definition of poverty line and the different strategy to reduce poverty.

The Measurement of Poverty

The different nature of poverty in the rural areas and urban areas bring challenge to the measurement of poverty. The measurement of the people who live under the poverty lines always be complicated issue. The definition and measurement of poverty has been changed over the time (Misturalli and Heffernan, 2010; Konkel, 2014). The World Bank (2001) define poverty as a broad conceptualization that captured the range of social, economic, political, human health, and environmental dimension. It includes four components: material deprivation, lack access to education and health services, vulnerability and exposure to risk, voiceless and powerless (Game et al., 2015: 164).

Tendulkar and Jain (1995) mentioned the three measurement to count the number of poverty. These three measurements are (HCR) that point out the number of people who live under poverty line in terms of a given norm, the poverty gap index (PGI) that point out the ratio of poverty gap of all the families who live in the poverty to the minimum normative aggregate expenditure for the entire population including poor and non-poor people, Foster-Greer-Thorbecke (FGT) that has its elements, the headcount ratio, poverty-gap portion and the relative inequality among people who live in the poverty that measured by the squared coefficient of variation (Tendulkar and Jain, 1995).

In 1990, the World Bank introduced the global poverty line at US$1 per day to measure the material deprivation dimension. This poverty lines at US$1 per day is widely used as the single most important indicator of development (Konkel, 2014:277). Kakwani and Son (2016) described the poverty line of $1.25 per person per day in 2005 PPP has been widely used and become a basis for assessing progress in the Millenium Development Goals/MDGs. However, based on the Kakwani and Son (2016) research in the 15 coutries, each country use different poverty line to measure the poverty rate.

Each country is shown to have a different equivalent poverty line. This paper finds that there is no single international poverty line in 2011 PPP that is equivalent to $1.25 in 2005 PPP. Single poverty lines vary for each region because countries have experienced different inflation rates and have different PPP conversion rates between 2005 and 2011.” (Kakwani and Son, 2016: 173).

The different nature of poverty in the rural areas and poverty in the urban areas bring challenge related to the measurement of the poverty lines. Sridar (2015) argued the poverty lines in the urban areas must be higher than poverty lines in the rural areas. The poverty lines in the urban areas should be higher because the cost of living in the urban areas are 30 percent higher than in the rural areas (Ravallion, Chen and Sangraula, 2007). Ravallion et al. (2007) argued the weak internal market integration and the existence of geographically non-traded goods can generate the different cost of living between urban and rural areas. In addition, the poverty line between urban areas and rural areas should be different because the different rate of income. Ravallion et al. (2007) found the different average of income in the people who living under poverty lines of $1 per day between rural areas and urban areas. The average income of poor people in the urban area was lower by $0.73 per day that the average income of poor people in the rural area by $0.76 per day.

Different Strategy on the Poverty Reduction

The percentage of poverty rate in the world has decreased during the past thirty years (Cervantes-Godoy and Dewbre, 2010). Each element including governments, non-government organization (NGO), the international financial institution (IFI) have strong will and effort to reduce poverty. China contributes the highest portion of the poverty reduction (Fosu, 2017). The poverty reduction become one of the important goals of Millennium Development Goals (MDGs) to reduce half of the rate of poverty by 2015 (Cervantes-Godoy and Dewbre, 2010; Magombeyi, Taigbenu and Barron, 2016). However, the poverty is still be a crucial problem nowadays. In addition, the number of poverty in certain countries increase during the past thirty years. Van der Ploeg (2012) stated around 1.4 billion people are living in the extreme poverty with income less than US$1.25 per day. Most of them (approximately 70 percent) was living in the rural area (Van der Ploeg, 2012). Not only in the developing countries, the developed countries also suffer the high numbers of poverty. Chaudry and Wimer (2016) stated the number of children who live in the poverty have remained very high since 1970s.

The different nature of poverty in the rural area and in the urban area should lead to the different strategy to reduce poverty. Sridhar (2015) argued the poverty in the urban area gradually increase during recent years because the governments has similar strategies to alleviate poverty in the rural and urban areas. In his opinion, the programs to reduce poverty always referred to the rural poverty.

“Possibly because of this, poverty reduction has almost always referred to rural poverty. While decades of focus on rural poverty programmes, policy and research mean that international aid architecture, NGOs and civil society are well versed in designing and implementing programmes and policies for rural poverty reduction, this is not the case for urban poverty (Banks, Roy & Hulme, 2011).” (Sridar, 2015: 100).

The different nature of rural poverty and urban poverty should be the basis to decide proper programs to reduce poverty. In the rural poverty, the programs should be focus to address the lack access of nutrition by increasing income poor people. This effort is related to the agriculture sectors because the majorities of the poor people in the rural areas depend on this sector. De Janvry and Sadoulet (2000) argued the effective way to reduce poverty in the rural area are by combining between access to the land and institutional development to increase the productivity of the land.

Addressing poverty in the urban areas should be focus on the opening access for the poor people to the non-food issues such as housing, water and sanitation, transport, fuel, electricity, healthcare, and education.

 

CONCLUSION

Rural and urban poverty have different nature that bring challenge to the poverty reduction. This essay compared the different nature of the poverty in the both areas and discussed the challenge related to the poverty reduction. The nature of poverty in the rural areas are correlated to the food security and high dependency of agriculture. However, the nature of poverty in the urban areas are related to the non-food problems, urbanization, and social political problems. This different nature of poverty in the both areas bring challenge related to the poverty reduction. The first challenge related to the definition of poverty line. The urban poverty line should be higher than rural poverty line. The second challenge related to the appropriate programs to reduce poverty. Poverty eradication in the rural area should open the access to the food by increasing household income. Increasing household income in the rural area should be related to the agriculture sector because most of the rural residents depend on the agriculture sector. Furthermore, addressing poverty in the urban areas should be focus on the opening access for the poor people to the non-food issues such as housing, water and sanitation, transport, fuel, electricity, healthcare, and education.

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