inquiry prod. defense revision

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S. Wyatt Shely

Ms. Caruso

UWRT 1103-037

16 November 2015

Solutions for Poverty Reduction

Billions of people in todays society experience the debilitating effects of poverty: loss of

dignity, deprivation of basic necessities, and crippled ability to thrive in society. Although there

have been efforts to reduce the disheartening effects of this issue, the prevalence is still widely

noticeable across the globe, especially in underdeveloped countries. Poverty is a

multidimensional problem that requires a multidimensional solution. Solely focusing on

government methods for alleviating poverty is not a convincing approach. Instead, societies

must incorporate internal elements such as disruptive innovation and new venture creation

(Bruton 14). Increasing entrepreneurship and innovation is the most critical step for poverty

reduction within a society. Distributing entrepreneurial business guides serve as an applicable

strategy to increase entrepreneurship among impoverished societies. In order to continue

alleviating poverty, education and healthcare standards should also be enhanced.

When observing environments that are undergoing economic growth, in general, the

population will experience a reduction in poverty. There is a negative correlation between

economic growth and poverty. As a society experiences growth in their economy, the poverty

rate is reduced. The most effective method to grow an economy is to develop new businesses

that not only provide an avenue for new jobs and incomes, but also increase healthy economic

competition (Shirima 3). Impoverished societies lack job opportunities that provide incomes to

support families. The key to counter this unfortunate circumstance is to promote the benefits of

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entrepreneurship. Now, how does one go about promoting entrepreneurship? This is the simple

question that led to the creation of entrepreneur guides. Poverty is a real world problem that

calls for a real world solution. By developing a guide that teaches readers about the benefits of

pursuing entrepreneurship, as well as basic business rules, impoverished individuals have a better

chance of success at pursuing and excelling in self-employment. Societies whose institutions,

politics and culture hinders entrepreneurship, do not experience the increase in development of

societies that do actively promote entrepreneurship development (Oghojafor 8). Different

regions of China have exemplified undeniable proof of this theory throughout the past few

decades. In fact, this nation is noted for a poverty reduction of more than 630 million people

since the 1980s (Jacket). By investigating countries that have had incredibly drastic reductions

in poverty, the international community might discover encouragingprocesses to employ in

different geographic regions.

Coinciding with the statements presented earlier, Chinas poverty was alleviated while

also experiencing economic growth, primarily from small business creation. Research

performed on over 700 manufacturing firms in the Yangzi region, has led to the notion that

entrepreneurs in the region, despite the strict Chinese government, created institutional

innovations that led them to start up and grow small, private manufacturing firms to develop

these firms (Jacket). As these manufacturing firms began to grow, aspects characteristic of

private enterprise economies developed along with them. This newprivate enterprise economy

spread like wildfire throughout the rest of the country. The resulting economic growth, wealth

creation, and manufacturing jobs caused the establishment of China to acknowledge the

numerous benefits of utilizing a private enterprise economy (Jacket). The innovative

entrepreneurs that founded manufacturing firms in the Yangzi region, serves as a symbolic

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difference in job creation for China; a job creation that helped cause an incredible reduction in

poverty.

The causal relationship between the increase of entrepreneurship and poverty alleviation

is further exemplified by a case study of the Chinese City of Yiwu. In the 1980s, Yiwu was

considered an example of desperate poverty (Si 123). Throughout the past few decades, Yiwu

inhabitants began escaping poverty through their own efforts. These efforts included innovative

and entrepreneurial strategies that shed light on a progression of new business opportunities.

Yiwus steps of poverty alleviation, as a result of entrepreneurship, include:

(1) A shift from passive to active attitudes and behavior towards fighting poverty;

(2) Causal mutual interactions among the regions impoverished people and the

people they saw emerging from poverty; (3) The pursuit of small profits rather

than maximized profits; and (4) The creation of disruptive business models

conducive to poverty reduction by people acting both as consumers and

producers. (Si 130)

This depicts Yiwus progression to become a universal example of how effective

entrepreneurship is a favorable route toward poverty alleviation. It is an inspiring notion that

these steps of pro-entrepreneurship strategies can be emulated in different regions of the world in

hopes to reduce poverty on a global scale.

Undeniably, entrepreneurship reduces poverty. Figuring out a way to produce more

entrepreneurs is critical in order to further decrease the poverty rate. A study of undergraduate

students at Obafemi Awolowo University in Nigeria, shows that entrepreneurship education is a

key factor to increase ones attitude of self-employment. Out of a group of students that received

entrepreneur education, 94% of respondents indicated their preference for self-employment,


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while the group that was not educated in entrepreneurship resulted in 14.7% of respondents

preferring self-employment (Obisanya). Clearly, impoverished societies need a source of

entrepreneur education that will not only teach them about the benefits and characteristics of an

entrepreneur, but will also explain basic business concepts that are necessary to be successful

when starting ones own business.

^

There is a growing need and demand for entrepreneurial opportunities that have yet to be

exploited. These needs will be met through the provision This is the role of the entrepreneurial

business guide,Be an Entrepreneur | Build a Business | Escape Poverty. It simplifies

complicated business ideas by explaining them through the development of a lemonade stand

business. This concrete scenario of a lemonade stand business eliminates ambiguity, while also

maintaining real-world applicability. The step-by-step guide is created for impoverished

individuals across the globe. Entrepreneurship is not limited by geographic location. There are

successful business developers all around the world. In order to receive the funding and

distribution channel necessary to getBe an Entrepreneur | Build a Business | Escape Poverty

into the hands of those in poverty, the publication rights will be given to HOPE International.

This is an organization that invests in the lives of those living in poverty, focusing on

encouraging saving and entrepreneurship in countries around the world (Huizinga par. 1). Their

mission served as inspiration for the development of the entrepreneur guide. When members of

HOPE International travel to various countries, they will be equipped with an effective

educational tool that will help spread the message about the power of entrepreneurship. As the

message is spread, poverty will be reduced one business at a time. Remember, poverty is an

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issue of multiple dimensions. These guides are not the ultimate solution to the problem. To

continue reducing poverty, other methods must be utilized.

Advocates of entrepreneurial approaches for poverty alleviation tend to overlook other

components that are instrumental for the war on poverty. Both education, especially primary

education, and healthcare should have a position in the conversation of poverty reduction.

Considering that Education gives people the knowledge and tools to break the cycle of

poverty, it becomes clear that education should hold a significant role when attempting to

alleviate poverty (Burnett sec. 1). Furthermore, the literacy rate among underdeveloped nations

is substantially lower than that of more developed nations. This expresses the urgent demand for

education in impoverished countries.

^

The idea that education will aid and reverse the trajectory of destitute populations is

validated by the findings of two separate research groups studying two completely different

geographical regions. The findings of Jung, Cho, and Roberts, studying poverty in the Southern

United States, have concluded that poverty rates have been reduced by the expansion in

education funding (Jung Abstract). Similarly, it has been found that China is experiencing a

decrease in poverty through the support of primary education (Song Abstract). Therefore, it can

be concluded that targeting funding toward education will be beneficial for impoverished

societies. The 1989 Convention on the Rights of the Child,under the United Nations, also

recognized the need for primary education to be made compulsory and freely available to all

(Burnett sec. 2). Taking into account immense similarities of these preceding conclusions,

governments of underdeveloped countries should focus on strategies that provide quality primary

schooling for all of their citizens. The upside of increasing the literacy rate while decreasing the

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poverty rate clearly outweighs the initial cost of supplying free primary education. In the long

run, all societies will benefit from the investment in the young populations education.

Mentioned earlier, it is understood that entrepreneurship is not the end all be all only

solution to eradicate poverty. Relating to educations benefits for poverty, improving healthcare

will yield similar results. It has been concluded by many sources that those who live in

povertyexperience more health problems and shorter life spans (Gien sec. 2). When

comparing the healthcare standards and spending of impoverished nations to more developed

nations, there are obvious disparities. Even differences in healthcare funding of different

counties in the United States create variations in the poverty rates (Jung Abstract). This depicts

the need to monetarily target healthcare systems when attempting to reduce poverty. It is

important to note that simply throwing money into a healthcare system will not magically

diminish the poverty rate.

^

In regards to alleviating disparity gaps commonly found in the United States, effective,

yet fundable, channels must be implemented. Similar to intelligent Much like smart business

planning, it is critical to identify what avenues, if funded, will create a positive impact the most

effective avenues must be identified prior to funding the general healthcare system. One

possible method is to provide funding capital for more social workers, as well as enhance the

quality of their training. This was one of the many successful strategies used in a project in

Vietnam that reduced the poverty by over eight percent (Gien sec. 2, 7). Another approach is to

contract primary healthcare out to non-state providers; providers outside of the public sector,

whether commercial or philanthropic. This will aid in the sufficient provision of the majority of

healthcare needs. Afghanistan has effectively implemented this strategy to give priority access

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to the population groups greatest in need, such as those living in poverty (Trani sec. 1).

Evidently, meeting healthcare needs will cause beneficial differences toward impoverished

societies. It is critical to equip strategies to reduce poverty with a comprehensive plan

addressing healthcare needs. Adequate funding along with a method for accurately targeting

low-income individuals, are necessary to detach the shackles of poverty.

Poverty is a solvable problem in need of a specific multifaceted strategy. An effective

formula to alleviate poverty is the combination of the provision of free primary education,

quality healthcare, and most importantly, education in entrepreneurship. The increase in

entrepreneurship and the development of new businesses offer the surest route to economic

growth and development, including job creation (Bruton 4). Be an Entrepreneur | Build a

Business | Escape Poverty is one tool to promote entrepreneurship education, but it is crucial that

scholars, nonprofit organizations, and philanthropists alike, continue researching ways to educate

communities about business creation. Find ways to help them get back on their feet, take control

of their own destiny, and climb their way out of poverty through their business.


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Works Cited

Original Sources

Oghojafor, Akpoyomare, Olayemi, Olabode, Okonji, Sunday, and Olaywola. Entrepreneurship

as a Intervention Strategy to Poverty Alleviation in Developing Economy. International

Entrepreneurship Forum. University of Essex, Jan. 2011. Web. 30 Sept. 2015.PDF file.

Shirima, Ludovick. "Alleviating Poverty Through Innovation and Entrepreneurship." Web. 29

Sept. 2015.PDF file.

New Sources

Bruton, Garry D, David Ahlstrom, and Steven Si. "Entrepreneurship, Poverty, and Asia: Moving

Beyond Subsistence Entrepreneurship." Asia Pacific Journal of Management. 32.1

(2015): 1-22. Print.

Burnett, Nicholas. "Education for Allan Imperative for Reducing Poverty." Annals of the New

York Academy of Sciences. 1136.1 (2008): 269-275. Print.

Gien, Lan, Sharon Taylor, Ken Barter, Nguyen Tiep, Bui X. Mai, and Nguyen T. Lan.

"Education Article: Poverty Reduction by Improving Health and Social Services in

Vietnam." Nursing and Health Sciences. 9.4 (2007): 304-309. Print.

Huizinga, Daniel. "Fighting Poverty with Entrepreneurship." Consider Again. WordPress, 17

Jan. 2015. Web. 17 Nov. 2015.

Jacket. Summary.Nee, Victor, and Sonja Opper. Capitalism from Below: Markets and

Institutional Change in China. Cambridge, Mass: Harvard University Press, 2012. Print.


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Jung, Suhyun, Seong-Hoon Cho, and Roland K. Roberts. "The Impact of Government Funding

of Poverty Reduction Programmes." Papers in Regional Science. 94.3 (2015). Print.

Obisanya, J.F, C.A.O Akinbami, and A.O Fayomi. Summary. "Entrepreneurship Education and

Undergraduates' Attitude to Self-Employment : a Case Study of a Nigerian University."

Ife Psychologia : an International Journal. 18.2 (2010): 87-107. Print.

Si, Steven, Xuebao Yu, Aiqi Wu, Shouming Chen, Song Chen, and Yiyi Su. "Entrepreneurship

and Poverty Reduction: a Case Study of Yiwu, China." Asia Pacific Journal of

Management. 32.1 (2015): 119-143. Print.

Song, Yang. "Poverty Reduction in China: the Contribution of Popularizing Primary Education."

China & World Economy. 20.1 (2012): 105-122. Print.

Trani, JF, P Bakhshi, AA Noor, D Lopez, and A Mashkoor. "Poverty, Vulnerability, and

Provision of Healthcare in Afghanistan." Social Science & Medicine (1982). 70.11

(2010): 1745-55. Print.

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