By Paul Polak
In accordance with his 25 years of expertise, Polak explodes what he calls the "Three nice Poverty Eradication Myths": that we will be able to donate humans out of poverty, that nationwide financial development will finish poverty, and that enormous company, working because it does now, will finish poverty. Polak exhibits that courses in accordance with those rules have totally failed--in truth, in sub-Saharan Africa poverty charges have really long past up. those failed top-down efforts distinction sharply with the grassroots method Polak and IDE have championed: supporting the dollar-a-day negative make more cash via their very own efforts. Amazingly adequate, unexploited marketplace possibilities do exist for the desperately terrible. Polak describes how he and others have pointed out those possibilities and feature constructed leading edge, inexpensive instruments that experience helped in lifting 17 million humans out of poverty.
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Additional info for Out of Poverty: What Works When Traditional Approaches Fail (BK Currents (Hardcover))
We start with a simple proposition,” he says. ”¹⁶ I couldn’t agree more. But the practical methods Prahalad proposes in order to take advantage of this new world of opportunity fall far short of the exciting vision he begins with. Like Jeﬀ Sachs, he makes little attempt to set priorities for poverty alleviation initiatives, and treats with equal admiration all nine of the businesses he presents as exemplary models for poverty eradication. Most of them do, indeed, implement admirable programs. But they vary widely in their proﬁtability and their impacts on poor people, and Prahalad, a professor in the University of Michigan Business School, provides no comparative analysis of the bottom-line proﬁtability of the business performance of these companies or of the direct measurable impact of their activities on the lives of poor people.
It is incorporated as a business but appears to operate more like an NGO executing grants, and since neither Prahalad nor Voxiva’s Web site provides any information on Voxiva’s ﬁnancial performance, it is impossible to evaluate its performance as a business. Four of the case studies Prahalad describes contain potentially useful examples for business opportunities that serve the poor. ICICI Bank, one of India’s largest banks, provides a cost-eﬀective model for forming more than eight thousand self-help groups (SHGs) of women who participate in the bank’s savings and loan programs.
As you can probably guess, I left Israel without making a deal with Netaﬁm. But this type of subsidy solution is endemic in the development world. It’s used by governments, the World Bank, UNICEF, the United Nations, politicians, and many development leaders who look for photo opportunities with the poor but have little concern about producing measurable results. Price subsidies for goods and services for poor people just about always end up making things worse. Even food given to people who are starving can cause problems.