An article written by Peter Gregory, released by the OECD, talks why ending corruption and decreasing barriers for women aids in ending poverty.
“Throughout the late 1970s and early 1980s, China instituted free market reforms such as opening itself up to trade with the outside world, removing the barriers to private enterprise and allowing agricultural markets to emerge.
“These reforms meant that 680 million people have been lifted out of poverty since 1980. Indeed, China accounts for three-quarters of the people moving out of poverty over the last three decades …
“China accounts for three-quarters of the people moving out of poverty over the last three decades ...”
“China is not the only one. Growth in other developing countries has lifted 280 million people out of poverty since 2000, according to former World Bank economist Martin Ravallion.”
The article’s author, Peter Gregory, says history shows the most effective economic development for poor countries is to let more people participate in markets. This can be achieved by:
- Protecting people’s business assets with formal property rights that enable grassroots entrepreneurship.
- Ensuring that women have the same property and inheritance rights as men.
- Enhancing economic rights by fighting endemic corruption that cripples entrepreneurship.
- Ending obtrusive industry policies that crowd out entrepreneurship.
- Removing rich-nation trade barriers that prevent developing nation producers from selling their wares in developed and developing markets.
- (Gregory estimates such trade liberalisation would make each person in the developing world on average US$1000 richer per year by 2030 and lift 160 million people out of extreme poverty.)
- Identifying and facilitating the development of markets that are beneficial for the most deprived. For example, the Human Capital Project in Cambodia uses a unique financing mechanism called personal equity finance, which enables impoverished students to pay for their university fees without the risk of a standard bank loan.
This article is from the October issue of INTHEBLACK