The numbers game

There are lies, damned lies, and statistics. So the saying goes.

We all know that statistics and stories can be manipulated. We also know these tools can provide invaluable insight. Numbers can give a general picture of different patterns in international development and humanitarian aid. But often they’re not great at telling the human side of the story. At the same time, anecdotes alone don’t necessarily represent broader trends. They’re both important. We need qualitative and quantitative stories to understand poverty and how to overcome it.

For example, consumption surveys are widely used to assess economic levels of poverty. This data shapes our understanding of how many people around the globe are poor. And it can lead to a lot of misconceptions about poverty. When economists Davis and Baulch went to ask people in Bangladesh more personal questions about their lives, spending, income, and consumption, they found that poverty is more fluid than most surveys indicate. In other words, people rise out of and fall back into poverty all the time. Numbers alone might give a completely different result than qualitative assessments. On top of this, we also have to understand the underlying processes that keep some people trapped, while others escape. And it often takes listening to people’s stories to understand that.

At the same time, stories can distort the bigger picture. Take microfinance, for example. A lot of microfinance organizations use personal stories in which people use microloans to start a business and lift themselves out of poverty. And that’s great. The problem is when these stories claim to have found THE solution to ending poverty.

Because the reality is much more complicated. Financial inclusion is important, but microfinance is not a silver bullet. Sometimes it helps. Sometimes it actually drives people into more debt. Often it falls somewhere in the middle. In fact, a lot of studies are questioning the effectiveness of microfinance at reducing poverty.

The other week we had a visitor from Kenya in my office. He told us about the grassroots work he did for a microfinance organization there. At the time, the organization only measured repayment rates. Nothing else. But when he went to speak to the people the loans went to, what he found shocked him. A lot of the women who received loans to start businesses didn’t start businesses at all. Instead, many used the loans to send their children to school. Of course, they still had to pay back the loan. So many sold off pieces of their land to make the repayment. Or some would sell livestock, or whatever it took to avoid falling into debt.

African women are often the face and focus of microfinance and other development campaigns. Yet, so rarely are they included as drivers in the discussion. Their voices are so important. Their stories can point to deeper understandings of why poverty persists. At the same time, numeric data is just as important. It helps us identify which stories are outliers, and which ones point to important trends.

Numbers need personal stories, and personal stories need numbers if we are to understand and eradicate global poverty.

Photo credit: UNDP Aid for Trade Project. Some Rights Reserved.
Photo credit: UNDP Aid for Trade Project. Some Rights Reserved.
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