Is Poverty a State of Mind ?

There are people in the world so hungry, that God cannot appear to them except in the form of bread.”
― Mahatma Gandhi

Poverty is a key challenge to humanity. The word poverty originated from the French world ‘poverte’ meaning misery or wretched condition somewhere in 12th century. Though the world has always seen inequality in terms of wealth or power, the concept of poverty has come to the forefront only after the formation of modern nation states were formed in late 17th and early 18th century. Until then , poor , hungry or homeless were the general terms used to describe symptoms of poverty.

To call poverty as a state of mind might sound as a politically incorrect statement at first glance. Yes, to mock impoverished people by reducing it to a figment of imagination is cruel. But, attitudes of recipients of poverty alleviation schemes can play a decisive role in its success or failure. Enterprising and optimistic communities might solve poverty faster than those that prefer freebies and fatalism.

Causes of poverty are not restricted to the domain of economics, social conditions and politics , though external conditions. We will have to pay attention to the psychological aspect as well to solve the problem.

Evolution of our understanding of poverty

With the intellectual awakening of colonized peoples and nationalist independence movements, people realized that poverty was one of the ugliest consequence of foreign powers ruling over them. Nations like India were prosperous before they were colonized . Tribal societies of Africa and Americas had not heard of poverty before they were subjugated by ‘civilization’, slavery and diseases.

Though the term poverty can be used to describe poor in a general way, there was a need to quantify the parameters to identify individuals suffering from the phenomenon. Dadhabhai Naoroji was perhaps the first to come up with the concept of poverty line. He came up with term called ‘prison cost of living’ which was equivalent to three fourth of the money spent by government for feeding an adult inmate in jail.

Nationalists in late 19th century and early 20th century were able to articulate the reasons for poverty in colonies. The macro economic exploitation by colonizing nations were cited as the key reasons for poverty. Individual abilities of the native people had been inhibited by colonial regulations, laws, heavy taxation and economic policies. Though early nationalists were able to define poverty and identify its causes, they did not make attempts to calculate what percent of population was living in poverty.

With the expansion of cities and industries, poverty as a phenomenon was recognized in western powers as well. However, no significant study was done on poverty till 20th century. Poverty and hunger were abstract terms that were not quantified by the academia or the state.


Seminal Work of Seebom Rowntree on Poverty

Seebom Rowntree, a British national was perhaps one of the first researchers who did a survey to find out about the percentage of people living in poverty.

He conducted his study in the city of York and collected data of 46,000 peoples income. People who were capable of hiring a domestic servant were excluded from the study. Rowntree found that 20000 people were earning below a minimum limit that he had calculated. That accounted for 28% of the population of York .Rowntree was the first person to coin the term ‘poverty line.’

Poverty, A Study of City Life was published by Rowntree in 1901. It carried details and conclusions of his study. According to him , there were two main causes of poverty. The first was absence of regular employment due to disability or lack of wage earners in a family. The other reason was low wages paid to workers. Wages paid were insufficient to lead a decent life. Basic necessities like food, clothing and fuel could not be purchased with many laborers.

The public was shocked by the work of Rowntree. Public opinion turned in favor of the poor as Rowntree went around England giving lectures. The media covered this enthusiastically. People in general and those in power could not sit back and blame the poor for their poverty.

Government and policymakers were forced to take a sympathetic view of the impoverished people in Britain. Free school meals, state pensions , health insurance and unemployment insurance for working men were some of the measures taken to alleviate poverty.

At the start of 20th century , the world had succeed in defining poverty and acknowledging that the poor required state support. The tendency to fault the poor for their poverty was dropped in Britain. Rowntree’s work proved to be a milestone in study of poverty and policy making .

Simultaneously, intelligentsia in colonies attributed the poverty of their peoples to the macroeconomic exploitation by colonizing nations . Further they argued that self rule and socialism as the key solutions for the same. Most of the prevailing ideas in 20th century attributed the cause of poverty to external factors alone.

Statistical Jugglery and Poverty

Though the concept of poverty line was useful to quantify poverty and identify eligible persons for state support, it later became a plaything in the hands of bureaucrats and governments. It was used to suppress the actual poverty levels in order to display a palatable situation to the larger public. In India, several methods have been employed to calculate poverty figures. Some of them are listed below.

The Rangarajan panel adopted the calorie method wherein an urban person is considered to be above poverty line if he is able to consume 2155 calories per day in rural areas and 2040 calories per day in urban areas .

This is lower than 2,400 kcal in rural areas and 2,100 kcal in urban areas suggested by earlier panel headed by Lakdawala.

Tendulkar methodology takes into account the spending capacity as a reference to find poverty levels. The government embarrassed itself when the number was put at 26 rupees per day. This is much lesser than UN designated minimum income of $2 per day.

Any sane person would agree that the methodologies suggested above do not consider the life of a person from the point of view of housing, education and health perspectives. These are also important for a dignified life. The exercise of finding poverty levels has been made a statistical exercise rather than a humanistic endeavor to understand poverty. The spirit that Rowntree had while conducting his survey is missing in modern surveyors.

After studying this change in approach, one can say that poverty is a manifestation of the state of mind of the government which is trying to address the problem. Is the government honest in its intentions to provide a decent life for all its citizens ? Or is it interested in statistical jugglery ? The way in which a government deals with the question of poverty alleviation, reflects the state of mind of the authorities and politicians who are elected to solve the problem.

Psychology and Poverty

Poverty has a psychological dimension as well. Studies have proven that poverty or hunger can force people to take bad decisions that further worsen their situation. Alcoholism is one such example. In my opinion , the approach of the state and policy makers must involve the psychological aspect of poverty without brushing away the harsh and inhuman condition in which the poor are forced to live in.

Several studies have proven that sudden fall or rise in incomes makes poor families prone to bad decisions. Poverty brings with it great amount of stress economically as well emotionally. This inhibits the ability of those stuck in poverty to take good life decisions ( like saving or providing education to kids). In addition to this , a positive impression of oneself and determination on part of those stuck in poverty is also essential.

State sponsored schemes like a Jan Dhan Yojana (zero balance bank account for every household in the country) can lead to a positive habit of saving money in poor households. In addition to this skill training, encouragement to labor intensive industries can help in increasing family incomes. In addition to this , micro credit schemes like MUDRA can also aid poor to start small businesses and encourage self employment among poor. Instilling confidence in the poor and changing their attitude towards their poor livelihood is also a part of the poverty alleviation agenda.


Hence, one can conclude that the state of mind of all stakeholders is an important factor in combating poverty. Shifting the entire blame on poor for their poverty is not a solution for the problem. Acknowledging economic and social disabilities and helping poor to defeat poverty is the only long term solution.


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