The Importance of Economic and Human Development

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This essay compares and contrasts two key paradigms for measuring poverty, namely economic and human-centered approaches. I argue that economic development (ED) and human development (HD) should be viewed as complementary and, as such, both are needed to promote human well-being. Nussbaum (2011) echoes this notion when she suggests that people need a combination of opportunities and capabilities in order to function in society (p. 25). Thus, I will first consider these models separately to determine how they respond to one another. And then, I draw parallels to reveal underlying commonalities. To conclude, I examine the role of the state in guaranteeing opportunities and capabilities. I aim to show that broader theoretical interpretations are useful for thinking about how policies address the issue of poverty.

The gamut of economic strategies include neoliberalism and ‘basic needs’ claims, the latter of which maintains that people require essentials, including nutrition and education, to rise above poverty. Neoliberalism affirms that such an investment in people ultimately produces a feedback loop for promoting economic activities, ensuring that incomes remain high (Fukuda-Parr 2003). In this sense, well-being is defined as utility maximization (Fukuda-Parr 2003, p. 304). However, one problem with this notion is that what benefits the majority is not always good for everyone (Deaton 2011). For example, ‘stop and frisk‘ policies in New York allow the police to search anyone with a suspicious appearance on the street. The intended result is expressed as making communities feel safer. However, many of those who are stopped have a minority background, which perpetuates negative attitudes toward this group of people. Therefore, the H...

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...may be greater access to education in urban areas where there are more people, which maximizes the effects. However, such an approach does not attend to people living in rural areas, who are repeatedly neglected, constituting a major oversight. In this case, using both the tools of HD and ED permits development practitioners to assess the situation on the ground in a more comprehensive manner and tailor programs to meet the needs of different groups. Cases like this abound; Sen (1999) presents the example of Kerala, which reduced income poverty with only moderate economic growth, owing to expansion of health care programs and more equitable land distribution (p. 31). Here, equal access to land, stimulates more opportunities and the alleviation of income poverty removes some constraints on capabilities, allowing people to make use of the opportunities they are given.

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