An Inquiry into Well-Being and Destitution.
Field, Alfred J., Jr.
This book represents a seminal work containing both an analytical and
empirical inquiry into the phenomenon of poverty and human well being.
The book is centered on the phenomenon of destitution, "the extreme
condition of ill-being," which the author views as both a personal
calamity and cultural tragedy. Much like Adam Smith in An Inquiry into
the Wealth of Nations, Dasgupta attempts to develop a broad political
philosophy based on a multidisciplinal foundation for viewing human
well-being which can serve as an ultimate guide for public policy. The
work draws upon a mixture of economic theory, moral and political
philosophy, anthropology, demography, epidemiology, nutrition, political
science, ecology and environmental science. Because he attempts to make
the work self-contained by including needed analytical tools the book is
both long and considerably inconsistent in the level of exposition. It
is, however, a thorough treatment of the poverty phenomenon in low
income countries. Considerable attention is directed to resource
allocation at all levels, as well as institutional factors, market
failures and externalities associated with household decision making,
particularly with regard to reproductive choices. Not surprisingly, it
is a very long book, containing 540 pages of main text, covering a wide
variety of topics. Consequently, it is virtually impossible to do little
more in a review such as this than provide a description and overview of
the work.
The book is divided into four parts and contains a total of 17
chapters, 7 chapter appendices and an extensive (80 page) list of
references. Part I, "Well-Being: Theory and Realization,"
contains five chapters focusing on theory and the measurement of
well-being. Topics covered here include "The Commodity Basis of
Well-Being" (1), "Political Morality and the State" (2),
"The Objects of Social Contracts" (3), "Well-Being: From
Theory to Measurement" (4) and "The Realization of
Well-Being" (5). This part focuses on the moral and philosophical
issues which underlie the concept and measurement of poverty and
destitution at both the individual and aggregate levels. These chapters
provide an illuminating literature review of areas related to theories
of justice, facts versus value, utility, rights and aggregative
evaluations of well-being, differences between consequential and
deontological considerations in reaching ethical judgements, rules vs.
discretion in social contracts and a variety of issues related to
measurement. The overriding purpose of this part is to identify the
duties of the state in a matter such as destitution and to demonstrate
the need for formal constructs to deal with such issues. It is thus
basic to but not integral with the remaining parts which focus on the
nature of the resource allocation mechanisms through which the state can
influence the distributive nature of the economy.
In Part II, "Allocation of Resources Among Households: The
Standard Theory," Dasgupta reviews "Resource Allocation
Mechanisms" (6), analyzes "Decentralization and Central
Guidance" (7), and examines "Uncertainty, Insurance and Social
Norms" (8) as they relate to uncertainty, risk aversion and market
failures in the market allocation of resources. Dasgupta utilizes Part
II and subsequently Part III to lay the foundations for the development
of a theory of poverty and destitution based upon the distribution of
assets. The existence and extent of destitution is seen theoretically to
be the result of economic disenfranchisement and undernourishment
resulting from the unequal distribution of resources. The micro analysis
which provides the underpinning for this model is fleshed out in Part
III, "The Household and Its Setting: Extensions of the Standard
Theory." The five chapters include "Land, Labour, Savings, and
Credit" (9), "Poverty and the Environmental Resource
Base" (10), "Food, Care and Work: The Household as an
Allocation Mechanism" (11), "Fertility and Resources: The
Household as a Reproductive Unit" (12), and "Population and
Savings: Normative Considerations (13). Each of the chapters in this
Part is followed by technical appendices (astericked chapters)
containing the analytical tools and/or models discussed in the same
chapter. The focus is on persistent destitution and chronic
undernourishment and Dasgupta examines extensively the economics of
commodity deprivation. Not surprisingly, he concludes that the standard
theory of resource allocation does not accommodate any notion of basic
physiological needs and hence cannot be relied upon to deal with
destitution. It does, however, permit him to identify the type of
resource allocation mechanisms required by a society guided by a
pluralistic social ethic. Because the household is increasingly seen as
the key unit with respect to decision making, the focus in these
chapters is on the behavior of the household with respect to
consumption, saving, work, health-care, education, and population
decisions.
The culmination of the extensive groundwork presented in the first
thirteen chapters is found in Part IV, entitled "Undernourishment
and Destitution." The final four chapters include "Food Needs
and Work Capacity" (14), "Adaption to Undernourishment"
(15), "Inequality, Malnutrition, and the Disenfranchised"
(16), and "Incentives and Development Policies" (17). It is
here that Dasgupta incorporates the ideas of destitution and poverty
into a general equilibrium framework of resource allocation. He notes
that most analytical models used to analyze poverty and undernourishment
have not embedded the phenomenon of undernourishment in them and sets
out to develop a formal construct to remedy this deficiency. The
resulting model incorporates physiological characteristics and
requirements and enables the derivation of policies which might be
adopted to alleviate these poverty problems.
The key to the model is the relationship between nutrition and
productivity which allows him to define threshold levels of nutrition
below which no work can be carried out as well as maximum levels of work
capacity. The nature of this relationship is governed by individual
characteristics such as body weight, height, maximal oxygen uptake, etc.
This relationship is then used to define a reservation wage, and a level
of market employment and unemployment. The reservation wage is a
non-wage income, including the value of leisure, which for the landless person is the income received from common property resources. For those
owning land it includes rental income as well as any common property
income. The unemployed in this model are referred to as the
involuntarily unemployed, and defined as those that cannot find
employment in a market employing someone with similar characteristics
who is strictly better off because of the employment. In this instance
identical individuals receive dissimilar treatment because of market
rationing, resulting in "horizontal inequity" and
undernourishment.
This approach permits Dasgupta to specifically incorporate the
simultaneous endongeneity of low incomes and undernourishment. The
author argues that the nutrition-productivity link along with
consideration of resource allocation can account for differences in wage
rates in neighboring villages, the presence of surplus labor, and
involuntary unemployment, common characteristics of low income
agricultural areas.
This framework of analysis also permits him to incorporate the impact
of government activity and local community participation, specify public
sector goals and evaluate the impact of government policies. He
concludes that the human condition in poor countries is best served by
limiting the public sector to production and allocation of collective
goods, the most important of which are infrastructure, public goods,
common-property resources, primary health care and school education.
This book represents a significant work dealing with "the
conditions in which people are born and the manner in which they live
and die in rural communities of poor countries." Although many of
the concepts and ideas presented are familiar to those who actively work
in economic development, Dasgupta's organization and review of the
many and varied dimensions of this topic representing a number of
different disciplines constitutes a contribution in and of itself. In
addition, this book has much to offer analytically to both academics and
those working in the policy field concerned with poverty in developing
countries. Of major significance is the formal incorporation of
institutional factors into the economic model which both enhances the
analysis of the development process and contributes to a richer
understanding of public-sector policy in poor countries.
Alfred J. Field, Jr. University of North Carolina-Chapel Hill