good governance is key to poverty alleviation essay

The way out of poverty and corruption is paved with good governance

Sri mulyani indrawati.

But, in some ways, corruption is only a symptom. Anti-corruption must be paired with efforts to enable governments to govern openly and fairly, to provide services and security to their citizens, and create an environment that fosters jobs and economic growth. These are the attributes of good governance and effective institutions, and helping countries achieve them is a major focus of our work in low-income countries around the world. Here are three ways we are going about it.

• We focus on institution-building. Prosperity and the quality of a country’s institutions typically go hand in hand. Governments with well-run, accountable institutions are better able to deliver public goods and support an environment that can generate jobs and growth.  Public sector performance is particularly important to the world’s poorest people, who rely disproportionately on government services, and improving service delivery is essential to leaving poverty behind. World Bank specialists in nearly 100 countries provide expertise and training to governments to strengthen public administration and public financial management -- systems that are the key to ensuring fiscal resources are spent efficiently, effectively, and accountably. We’ve seen significant results. Between 2011 and 2015, 50 million people in the poorest countries gained access to better water services, 413 million people received essential health services, and 102,000 kilometers of roads were constructed or improved. In Comoros , we’ve helped the government strengthen economic management, so that more information on national finances is available to the public than ever before. In Côte d'Ivoire , our support has helped the government bring in the private sector and prepare energy , transport and port infrastructure projects. Impending reforms of the financial sector promise to promote investment in agriculture , agribusiness and manufacturing. Data is crucial, and one of our priorities is building the statistical capacity of our client countries. Last year, we helped 32 countries (including 11 fragile states) do this; 18 countries now use statistics to design and monitor policies and promote accountability and transparency.  For example, Bolivia has completed agricultural and housing censuses and three rounds of household surveys to strengthen the planning and evaluation of public programs and policies.  
• We help countries mobilize the resources necessary for delivering services. Fifty percent of low-income countries raise less than 15% of their gross domestic product in taxes. By contrast,  the OECD average is about 34% . The reason for this discrepancy? The poorest countries grapple with a wide range of problems: businesses — both foreign and domestic — that avoid paying taxes, large numbers of informal businesses that aren’t on the books, weak revenue administrations, poor governance, lack of international tax cooperation and the public’s mistrust. This is not just a question of raising taxes, but of designing tax systems that are fair and accountable and don’t hinder economic growth. We’ve supported tax reforms and improved tax administration for years, both within countries and in international fora such as the G20. And we just launched a Global Tax Team to expand this work.   From 2012 to 2014, Mauritania increased the amount it collects in taxes by nearly 50 percent through reforms to improve public resources management. In Pakistan , tax collection in the Sindh province increased by 24 percent in a single year. While development assistance will remain critical in the fight against poverty, it won’t be enough to achieve the ambitious goals we have set. We must help countries mobilize domestic resources – the largest untapped resource for development - to become self-sufficient and to provide quality services to citizens.  
• We promote transparency and accountability. Openness about the use of public resources builds trust between citizens and their governments. It can make public spending more targeted and effective. This is why we work with governments to make their budgets and the way resources are used more transparent, This also reduces fraud and corruption, and makes citizen voices heard. Tunisia is among 40 countries using our public expenditure database tool to make detailed public spending data more open and accessible. Also in Tunisia, our research quantifying the value of illicit trade and identifying the scope and cost of state capture has helped increase transparency and improved the ability of Tunisians to hold their government accountable. In Moldova , more than 2,200 public servants and other employees received e-government training. People can now access more than 880 government datasets and 131 electronic public services. In Nigeria , the number of public contracts awarded through open competition grew by 85 percent in 2015, up from 20 percent growth in 2009. The three-pronged approach of improving institutions, raising more domestic resources, and engaging citizens is the closest thing to a development silver bullet. Chronic mismanagement and corruption demoralizes citizens and undermines their trust in the state; corruption deepens poverty, leaving the poor vulnerable to exploitation and bribery in return for services such as health care and education; denying citizens participation in their governments stunts their full potential. For all of these reasons, the World Bank considers strong governance and effective institutions essential to putting the poorest countries on the path to self-sufficiency.
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The role of good governance in fostering pro-poor and inclusive growth

Subscribe to africa in focus, djeneba doumbia djeneba doumbia economist - international finance corporation.

July 1, 2020

Despite the positive narrative around the significant decline in extreme poverty around the world, not all the news is good. Still today more than 700 million people live with less than $1.90 a day, more than 72 percent of them in Africa. Worryingly, the COVID-19 pandemic could push a further 71 million people into extreme poverty under the baseline scenario, and 100 million under the downside scenario—wiping out progress made in poverty reduction since 2017 . At the same time, income inequality is on the rise in most developed and developing countries.

How do these two divergent dynamics—decreasing poverty and rising income inequality—impact the income opportunities of the less fortunate, namely, the poorest 20 percent of the population? The good news, which I share in a recent paper , is that growth has been pro-poor globally as the income of the poorest 20 percent has increased with per capita income growth. For the average country in our sample, between the mid-1970s and the mid-2010s, I find that 1 percent growth in GDP per capita led to about a 1.4 percent increase in the income of the poorest 20 percent. Similar growth led to a decrease of about 2.3 percent in the poverty headcount ratio, measured as the percentage of people living on less than $2 a day. However, growth has not been inclusive as it did not significantly impact the growth of income share held by the poorest 20 percent . How, then, can governments promote pro-poor and inclusive growth? In my cross-country analysis on the main structural factors that impact pro-poor and inclusive growth with a special focus on the quality of governance (as measured by the Worldwide Governance Indicators on a scale from -2.5 to 2.5), four policy-relevant recommendations emerge. These are:

First, the combination of political, economic, and institutional features of good governance, especially the control of corruption and regulatory quality, improves the income of the poor and decreases poverty . Good governance, as embodied, for example, in the control of corruption and the design and implementation of effective regulatory policies, significantly improves the ability of the poor to participate in and benefit from economic growth. A one-point increase in the control of corruption index (for instance, equivalent to a marginal improvement in control of corruption index from the level of Ghana to the level of Botswana) and regulatory quality improves the income of the poor by 39 and 42 percent, respectively. Corruption negatively impacts economic growth more generally by impeding some drivers of potential growth such as public and private investment, human capital accumulation, macroeconomic and financial stability, and total factor productivity.

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Corruption, however, tends to have a greater impact on the poor. For instance, in a corrupt system, the provision of public services, including education and health care, can be made inefficient because corruption lessens the government’s ability to allocate public services in an efficient and equitable manner. Through corruption, the government wastes resources that could otherwise be used to provide and improve services for the poor . Regulatory quality is also an important factor for poverty reduction, as effective regulation promotes the creation of an enabling environment that contributes to economic growth and the well-being of the population.

Second, there is a minimum level of control of corruption beyond which pro-poor growth tends to accelerate . Using the Panel Smooth Transition Regression model, I find that the impact of growth on poverty reduction is nonlinear and depends on the level of control of corruption. Control of corruption is particularly good for pro-poor growth when the control of corruption index is beyond a certain threshold—when the index is greater than -0.8, such as in Botswana and Namibia (Figure 1). For countries in which the control of corruption is above the threshold, the result is larger impacts of per capita income growth on the income of the poor than in countries where corruption is more prevalent (control of corruption is below the threshold). Notably, the level of control of corruption is below this tipping point in many sub-Saharan African countries (Figure 2), highlighting the need to further improve governance and reduce corruption, especially given that extreme poverty rates in the region are among the highest in the world.

Figure 1. Nonlinear relationship between the impact of growth on poverty reduction and the level of control of corruption

Source: Author’s elaboration, Doumbia (2019). Note: The sample includes 36 countries across different income groups, over 1995-2012.

Figure 2. Control of corruption index in sub-Saharan African countries, 2017

Third, only two features of governance— government effectiveness (economic governance) and rule of law (institutional governance)—promote inclusive growth . In this way, I find that economic growth should be complemented with liable and transparent public administrations, effective government policies, and efforts to promote confidence in legal authorities and institutions, which could lead to a nondiscriminatory redistribution of the gains of growth. Fostering inclusive growth requires the effective implementation of government policies and the existence of institutions that make possible a fair distribution of the benefits from economic growth. This strategy could also promote a system of better social inclusion through, for example, better education systems, social insurance, and improved labor markets. In addition, by protecting property rights and supporting an equitable enforcement of law for all individuals and businesses, a system with strong rule of law also promotes inclusive growth.

Fourth, enhancing human capital development through improved access to health care, education, and nutrition (especially for children); developing infrastructure; and advancing the financial sector are all key drivers for both poverty reduction and inclusive growth. Specific policies include the provision of infrastructure to connect people to opportunities; quality affordable education and health services to enhance human capital; and the implementation of programs to strengthen the financial sector and expand access to finance. The paper’s findings suggest that good governance should be included in that list.

The current COVID-19 pandemic is a reminder of the critical need to expand health care capacity, especially in Africa where there are only 2.5 doctors for every 10,000 people, compared to about 30 in OECD countries . Good governance is critical for efficiently addressing both health- and non-health-related implications of the current COVID-19 crisis. The continued efforts of policymakers, donors, multilateral institutions, and nongovernmental organizations to strengthen governance, enhance the control of corruption, advance government effectiveness, and promote economic and social fairness will help poverty alleviation efforts.

To combat corruption, countries should focus on four main policy imperatives: (1) ensure high standards of integrity in the public sector and enhance openness and transparency in government communication, including the provision of information on public finances to the people; (2) invest in sound and independent audit systems in order to promote accountability; (3) improve the international exchange of information in order to ameliorate foreign trade and fight illicit cross-border financial transactions, many of which contribute to tax evasion; and (4) use information communication technologies (ICT) to strengthen and help efficiently enforce these policies.

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Good enough governance: poverty reduction and reform in developing countries

2004, Governance

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Over the last decade reports from the World Bank illustrate that we have seen great strides in poverty reduction (WorldBank, 2014; Weissreport, 2013). Figures show that global poverty is down by 51% since 1981 (WorldBank, 2014). However, many authors are arguing that these figures are misleading (Wade, 2004). For example, while we are seeing an eradication of poverty in places such as China there inherently remains a polarization between rich and poor (Chen and Ravallion, 2004). It is this inherent polarization that this paper will turn in order to discuss the relationship between poverty reduction and governance.

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• DOI: 10.61707/gn5qy464
• Corpus ID: 272240386

Policy Innovations in Poverty Reduction: Assessing Government Strategies and Their Impact on Socioeconomic Development

• Dedeng Yusuf Maolani
• Published in International Journal of… 12 August 2024
• Economics, Political Science

55 References

Alleviating poverty in the united states: the critical role of snap benefits, good enough governance: poverty reduction and reform in developing countries, social protection for the poor and poorest : concepts, policies and politics, progress against poverty: sustaining mexico's progresa-oportunidades program, is microfinance a ‘magic bullet’ for women’s empowerment analysis of findings from south asia, experimental evidence on scaling up education reforms in kenya, conditional cash transfers: reducing present and future poverty, an unbreakable path a comparative study of decentralization and local government development trajectories in ghana and uganda, evaluating the impact of brazil's bolsa família: cash transfer programs in comparative perspective, conditional, unconditional and everything in between: a systematic review of the effects of cash transfer programmes on schooling outcomes, related papers.

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The Political Economy of Good Governance for Poverty Alleviation Policies

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This paper discusses the political economy factors that determine the quality of governance for poverty alleviation policies.

• http://hdl.handle.net/11540/1526

The motivation of this research paper is to shed light upon the political economy factors that determine the quality of governance for poverty alleviation policies. This issue is a crucial one because although remarkable strides have been made in some parts of the world, more than 2.8 billion people live on less than $2 a day. The situation begs the important question: Why have poverty alleviation efforts by developing countries not achieved the momentum necessary to improve the living standards of poor? An important reason why growth with significant redistribution has not occurred in many developing countries is that poverty reduction strategies have often been politically naive. The literature spawned by major development institutions until the 1980s did not go beyond policy prescriptions to ask under what political conditions redistributive policies could be successfully adopted. This is a relevant issue because policies reflect concrete political and social interests and it is not hard to imagine a situation where poverty-alleviating reform is hindered by vested interests.

The aim of this research paper is to shed light upon the factors determining quality of governance, because poor governance is but a manifestation of these deep-rooted institutional and political biases against the collective interests of the poor.

• Introduction
• The Political Economy of Good Governance
• Towards Good Governance: Policy Implications
• Conclusions

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Governance Practices in Poverty Alleviation Projects: Case Study from Stewardship-Driven Perspective and Sustainability Context

• First Online: 06 December 2021

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• Abdul Muhaimin Abdul Latiff 8 ,
• Che Maznah Mat Isa 8 &
• Aini Jaapar 8  

593 Accesses

The successful planning and implementation of poverty alleviation projects are crucial for establishing optimum benefits to its intended target groups in line with the Sustainable Development Goals charted by the United Nations. This chapter focuses on exploring the project governance practices in poverty alleviation projects from public officials’ perspective through the lens of stewardship theory. Project governance is a framework and functions to guide project management activities to meet organisational strategic and operational goals, leading to project success. By investigating three (3) public poverty alleviation projects in Malaysia, it is discovered that project governance is practised and positively interplayed with several project governance elements throughout the project planning and implementation. Several insights and rationales of the decision-making process from the sustainability contexts are also explored where the target groups should be allowed to participate in decision making in the front-end of the project, while lessons learnt from previous projects are invaluable input that should be compiled and documented for future references. Although the fragmented nature of public projects is considered a point of weakness, project delivery success could be achieved by utilising project governance practices applicable in public poverty alleviation projects.

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The researcher acknowledges the Ministry of Rural Development Malaysia and Ministry of Housing and Local Government Malaysia for their permission to conduct this study.

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Latiff, A.M.A., Isa, C.M.M., Jaapar, A. (2022). Governance Practices in Poverty Alleviation Projects: Case Study from Stewardship-Driven Perspective and Sustainability Context. In: Hassan, R., et al. Green Infrastructure. Springer, Singapore. https://doi.org/10.1007/978-981-16-6383-3_14

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The role of good governance in reducing poverty and inequality: evidence from a scoping review of interlinkages between SDGs 16, 10 and 1

in: Breuer, Anita / Daniele Malerba / Srinivasa, Srigiri / Pooja Balasubramanian (eds.), Governing the interlinkages between the SDGs: approaches, opportunities and challenges, London: Routledge, 30-50

ISBN: 978-1-03-218465-4 DOI: https://doi.org/10.4324/9781003254683 Open access

Targets under SDG 16 of the 2030 Agenda include institutional principles of good governance, which are considered key enablers for all other Sustainable Development Goals (SDGs). Despite their systemic importance, existing literature on SDG interlinkages has thus far provided limited coverage on how exactly aspects of good governance enable or constrain the improvement of social and economic systems. To fill this gap, this chapter presents the results and key findings from a scoping review of scholarly literature dealing with interlinkages between institutional aspects of SDG 16 and the achievement of poverty reduction (SDG 1) and reduced inequalities (SDG 10). The results of the review reveals that empirical evidence from across the globe testifies to the positive contribution of accountable, transparent and inclusive governance to the reduction of poverty and inequality.

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Malerba, Daniele

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Impact of Leadership and Governance on Poverty Alleviation in Africa

10 Pages Posted: 11 May 2020 Last revised: 9 Nov 2020

Samson Obiora

University of Lagos

Date Written: April 15, 2019

Leadership is one of the most observed and least understood phenomena on earth (Afegbua & Adejuwon, 2013). A call for a focus on leadership and governance is timely, important and no doubt topical, reflecting the worldwide thrust toward political and economic liberalization (Afegbua & Adejuwon, 2013). The ubiquity of the governance phenomena in contemporary times has made most African and indeed, global multilateral organizations, like the World Bank, United Nations Development Programme (UNDP), and the United Nations Economic Commission for Africa (UNECA) to become "governance infatuated" by giving prescription and insisting that governance is the key to economic growth and development in Africa (Essien, 2012). Nonetheless, after two decades of unprecedented economic growth, how much have the lives of African families improved? A plethora of its citizens wallow in poverty hinged on the declining quality of governance, and indeed the spatial culture of non-existent leadership in Africa. The latest estimates from the World Bank suggests that the share of the African population in extreme poverty did decline- from 56% in 1990 to 43% in 2012. These are staggering numbers. In fact, the search for aptness in government and governance that is oriented toward development, the common good and well-being of the people of Africa has become something of a scandal and simply ironic (Anyanwu, 1998: 148). This paper engages in a conceptual examination of the nexus between leadership and governance focusing on the impact of their interaction on poverty alleviation. Using selected key governance indicators such as government effectiveness and control of corruption, voice and accountability, budgetary transparency, resource allocation and targeting of benefits, and the rule of law and human rights, this paper investigates the governance contents of member states, its Impact and the extent which it can transform leadership and promote good governance as a basis for achieving poverty alleviation in Africa.

Keywords: Leadership, Governance, Poverty, Africa

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Samson Obiora (Contact Author)

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Good governance a prerequisite for poverty alleviation.

Will there be any meaningful poverty alleviation during the year 2002-03 without any suitable mechanism, as had been during the current financial year, though considerable funds were available.

The government during 2001-02 relied on district governments for poverty alleviation but there has been no success on the issue, though the government claims of having created roughly 2,75,000 jobs.However there is no official data available to verify this claim. It is always the Labour Force Survey which provides details about the creation of new jobs and last such survey was conducted in 1999-2000.

Local and foreign agencies continue to maintain that poverty, in Pakistan was increasing. According to the Labour Force Survey of 1999-2000, unemployment was 7.8 per cent, which two years earlier was 5.9 per cent. The government, as yet, has not come up with new the Labour Force Survey data which could disclose the latest situation with regard to unemployment.

There has not been considerable investment by the private sector during the last few years on account of political uncertainty, and inconsistent economic policies of the successive governments. Interestingly, there was no difference of opinion among the past governments to deal with the issue at macrolevel, which has taken such a serious turn that for the first time international donors have stopped pressurizing investments in infrastructure projects.

They concede that the funding did not help in alleviating poverty, which is why, they have now started offering Pakistan highly concessional IDA funds on marginal charges. The IMF has, for the first time, offered $1.3 billion Poverty Reduction Growth Facility (PRGF). Generally, it is proposed by independent economists and experts that the government should go for labour-intensive rather than capital-intensive projects in order to address this issue seriously.

Though, the government has a strategy to deal with the issue but faces problems in implementing it. Provinces are not very happy over government’s decision to offer funds directly to district governments for poverty alleviation. Since the experience during the outgoing financial year was not successful, the provinces are now reportedly complaining that they were being ignored and bypassed, and how can the federal government achieve anything on poverty alleviation front without taking them into confidence. The issue is said to have been raised by the provinces in the National Economic Council (NEC) meeting held on June 8, well before the presentation of the budget on June 15.

It is also being claimed that generally poverty related resources were not released in time which causes problems in effectively dealing with the issue.

Therefore, there is a need that the government must first come out with the implementation mechanism and ensure checks and balances for prudent spending. So far, all agree that most funds are eaten away in the absence of proper accountability. According to a politician, whosoever is caught misusing funds should face accountability. “In our system there are thousands of loopholes to get away without punishment after looting the national exchequer”, he said choosing anonymity.

Local and foreign experts agree that Pakistan had witnessed rising poverty in 1990s with weak human development indicators. The government now, has come out with a strategy for poverty reduction and social sector development, according to which good governance is very crucial. Good governance facilitates participatory policies, as well as, sound macroeconomic management. It ensures transparent use of public funds, encourages growth in private sector, promotes effective delivery of public services and helps in establishing the rule of law. A key element of the strategy is empowerment of the poor by increasing the ownership of physical assets. This will improve their prospects of being able to secure sustainable and adequate livelihood by augmenting human capital endowments, through improved access to education and health services and the political system, state institutions and laws that promote decentralization and participation of the people.

President General Pervez Musharraf is often confronted with the issue of poverty, price hike, unemployment and weak social indicators. So is the situation with the ministers taking care of the economic ministries. The government too, claims of giving importance to the agriculture sector with a view to providing more jobs, especially in the rural areas. But practically, how much care is offered to the farmers is a question needing answer. It is no secret that the budget making is extensively influenced by the businessmen lobby. We cannot ignore the influence of the textile industry and the manufacturing sector.

How much importance agriculture is given, could be gauged from the failure of the government to ensure certain support prices for wheat and sugarcane. Not a day passes when President’s advisor on agriculture does not write to Gen Musharraf, informing him about the plight of farmers. But since farmers do not have any lobby, nothing is happening. Under these circumstances, it all looks cosmetic to do anything for the agriculture sector with a view to removing poverty from the rural areas. There is an urgent need to evolve certain effective monitoring system to make sure that the poverty-related funds are spent judiciously and adequately for which provinces will have to be taken into confidence.

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Good Governance Is Key To Poverty Alleviation

• Minahil Mohsin
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Write a 200 words paragraph on Good Governance Is Key To Poverty Alleviation | The following topic was asked in the English Precis and Composition Paper of PMS 2019

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Good governance is critical to alleviating poverty and promoting sustainable development. For sure, effective governance helps ensure that resources are used efficiently and effectively to improve the lives of all citizens, particularly the poor. It also creates an environment conducive to private sector development and investment, which drives economic growth and job creation. In addition, when governments are transparent and accountable, they build trust among citizens and encourage greater political participation, leading to better decision-making and outcomes. Next to it, good governance also helps tackle corruption, a major barrier to poverty reduction. When corrupt officials siphon off resources, they are not available for investment in infrastructure, health, and education, which are essential for reducing poverty. Further, when corruption is rampant, it undermines the rule of law and creates an uneven playing field, which disproportionately affects the poor. Finally, good governance is essential for ensuring that public services, such as health care and education, reach all citizens, regardless of income or social status. When these services are available and accessible, they help break the cycle of poverty by providing people with the tools and skills they need to improve their lives and secure a better future for themselves and their families. In conclusion, good governance is a crucial component in the fight against poverty, and efforts to improve governance must be a central part of any poverty reduction strategy.

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