“I LIKE money and nice things, but it’s not money that makes me happy. It’s people,” says one woman in a World Bank survey. She’s not alone: research has found that social integration is more important for well-being than income, and also decreases poverty. Loneliness, conversely, can be deadly: one study found it did more damage to health than smoking. This week, policymakers from 40 countries met in Colombia to ponder ways to measure deprivation that take account of more than just income, including isolation. Several Latin American countries are devising or have already adopted such “multi-dimensional” measures of poverty.
Income can be a misleading measure of need because poor people end up living in different degrees of hardship depending on their intangible resources. Having strong social bonds eases financial deprivation. Friends and relatives can lend money, pool risk, mind children and bring news of job openings. Researchers from the London School of Economics found that when a group of Bangladeshi women were given business training and free livestock, not only did they move up the income ladder, but their friends’ lot improved too. A year later the friends’ consumption had risen by almost 20%, and they claimed to have become savvier about business as well.
The downside is that not having the right friends can cement hardship. The...Continue reading
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