Amartya Sen’s Capability Theory of Development and Poverty
Table Of Contents
1. Overview Of Amartya Sen’s Capability Approach
2. Core Concepts: Functionings, Capabilities and Agency
3. Poverty In Rich Countries
4. Non-Monetary Poverty
5. Importance Of Freedom and Democracy
6. Development means Expansion of People’s Freedom
7. Freedoms Supports Expansion of Capabilities
8. People are “Agents” of Change
9. Accepting Human Diversity
10. Poverty is Deprivation of Basic Capabilities
11. Influence of Amartya Sen’s Capability Theory
12. Challenges in applying the Capability approach
13. Critique Of Capability Approach
14. Conclusion
The Central theme of Capability Theory
1. Overview Of Amartya Sen’s Capability Approach (CA)
A People Centric Approach
The capability approach (CA) is a people-centred model of development and involves the process of acquiring more capabilities and enjoying more opportunities to use those capabilities. With more capabilities and opportunities, people have more choices. Expanding choices is at the core of the capability approach. Over the past decades, Amartya Sen’s capability theory has emerged as a serious alternative model of progress and development. It is both comprehensive and flexible.
It shifts the development discourse from pursuing material opulence to enhancing human well-being, from maximizing income to expanding capabilities, from optimizing growth to enlarging freedoms. Sen’s approach focuses on the richness of human lives rather than simply on the richness of economies, and in doing so it has changed the lens for viewing development results. It is broader than other approaches, such as the human resource approach, the basic needs, minimum rights and the human welfare approaches.
People should be the focus of development.
A Paradigm Shift!
People who have grown seeing economic growth as development will undergo a paradigm shift in their thinking when they step into Amartya Sen’s capability approach of development. People obsessed to measure human well-being in simplistic money terms get disheartened when the CA reveals social, personal or say, psychological dimensions of development. And people who have grown up taking economic expansion as the only goal of development are confused when Sen puts ‘people first.’
Rather than talking of philosophical equality of people, the capability approach explicitly recognizes the individual differences coming from things like age, sex, race, class, health, disability, intelligence, education and so on. It also accepts that people’s abilities are influence by external factors – other people, social arrangements, access to infrastructure and public services, freedom to speak and participate, state policies and so on.
Since it considers people as humans (and not as mere consumers) the scope of the capability approach is quite vast. All possible factors – personal, economic, social, political, or environmental – that can possibly influence human capabilities which dictate the real well-being of people, come relevant. In this approach social exclusion is as important as racial discrimination.
Resource based theories do not acknowledge the fact that people differ in their abilities to convert their resources into capabilities. The capability approach rejects normative evaluations based exclusively on commodities, incomes, or material resources. The capabilities don’t refer exclusively to a person’s abilities or internal powers, but it refers to an opportunity made feasible (and constrained by) both internal (personal) and external (social and environmental) factors.
In the capability framework, poverty is seen as deprivation of capabilities, which limits the freedom to pursue the goals in life. For Sen ‘capability deprivation’ is a better measure of poverty than lowness of income. He asserts that poverty should be seen “as a deprivation of basic capabilities, rather than inadequate income. If in today’s world of sheer abundance there are people living in poverty, they are living in a state of ‘un-freedom’, unable to realize their capabilities.
Salient Features Of The Capability Approach
The capability approach focuses on people as humans, not as mere consumers.
It focuses on individuals, unlike the basic needs and standard of living approaches that concentrate on households.
It views goal of development as expansion of people’s freedom, not expansion of economy.
The capability perspective is intrinsically multidimensional; it is concerned with a plurality of different features of our lives and concerns.
It considers individual differences. For instance, it recognizes that senior citizens, young children, people with disability need extra attention.
It does not see people in isolation, but inherently considers societal, political and other factors that affect people’s lives and capabilities to function.
It focuses, not on poverty, but on the poor – in terms of capabilities’ deprivation.
2. Core Concepts: Functionings, Capabilities And Agency
Sen argues that people’s well-being depends upon what they are actually capable to be and do with resources, facility and freedom available to them. Knowing what a person has doesn’t tell about how well his life is going. A simple example: Having a cycle doesn’t say that the owner has acquired the capability of mobility from it. He might simply doesn’t like to ride the cycle, or he might be handicapped, or doesn’t know how to ride it.
Functionings: Life of a person to consist of “a sequence of things the person does, or states of being he achieves: together they constitute ‘functionings’.” Thus, functionings are what people actually “do and are” – they are achievements of people. Taken together, these doings and beings – achieved functionings – give value to life. They can be both basic and complex achievements.
Putting in simple words, functionings are various things a person value being and doing — such as being happy, being literate, able to work, rest, adequately nourished and in good health, as well as having self-respect and participating in social and political activities.
Achieving a functioning with available resources and facilities depends on a range of personal and social factors (e.g. age, gender, activity levels, health, access to medical services, nutritional knowledge and education, climatic conditions, and so on). A functioning therefore refers to the use a person makes of whatever is at his/her command. They are closely related to another core concept: capability.
Capabilities may be visualized to have two parts: functionings and the substantive freedom to choose from them. They denote a person’s opportunity and ability to achieve desired outcomes, considering all internal and external factors. Most significantly the freedom should be intrinsic (has valuable in and of itself). If the freedom were just a means to achieve an end then the capability set would simply the combination of functionings.
Thus, the capability approach is not merely concerned with achievements (outcomes), but basically with freedom of choice, which is of direct importance to a person’s quality of life. They are like opportunities about what a person may like to do, have, or be. In other words, capabilities refer to the real freedoms a person “enjoys to lead the kind of life he/she has reason to value”.
Consider the difference between fasting and starving, on a person’s well-being. Fasting involves a choice to not eat despite the availability of food, but another (poor) person starves because he has no choice. Clearly, the difference is the freedom of choice. Therefore, having a lifestyle is not the same as choosing it – it is important to emphasize that well-being depends on how that lifestyle came to be.
Difference between functionings and capabilities
Functionings refer to what people actually “do and are” and capabilities denote what people really “can do and can be”. The achieved functionings are the realized achievements and the capabilities are potentially possible. Functionings are, in a sense, more directly related to living conditions, since they are different aspects of actual living. Capabilities, in contrast, reflect his freedom to choose between alternative combinations of functionings. In the absence of freedom to choose, we would only be talking about his functionigs – what he can do or be. Therefore, the freedom to choose is inherent in the definition of capability.
The difference can be best illustrated with an example. Consider two persons, both without enough to eat. One is a victim of a famine in Africa and the other is sitting on a hunger strike in New York to protest against US troops in Afghanistan. Although both lack the functioning of being well-fed, their freedoms to avoid hunger are vastly different. The former is badly constrained in freedom and lacks the capability to achieve the functioning to be well-fed; the later has this capability even though he is choosing to be hungry.
Agency
The capability approach of development is about enlarging freedoms so that all people can pursue choices that they value. Such freedoms have two fundamental aspects — freedom of well-being, represented by functionings and capabilities, and freedom of agency, represented by voice and autonomy. Both types of freedoms are absolutely necessary for human development. Agency is related to what a person is free to do and achieve in pursuit of whatever goals or values he or she regards as important.
Amartya Sen defines an agent as someone who brings about change. Agency in the context of capabilities approach primarily refers to a person’s interactive role in the society – his freedom to participate in economic, social, and political actions. In order to be agents of their lives, people need an environment where they have the freedom to speak in public without fear, raise their voices, associate with others and influence external factors that affect their lives.
It points to the importance of fostering institutional participation, public debates, democratic practices, and empowering policies. These are all on-monetary dimensions of life and particularly important for poverty alleviation, sees as expansion of capabilities.
Capability Theory
Homelessness in Rich Countries
As of 2012 there were 633,000 homeless people in the United States and 284,000 in Germany. Such anomalies are part of GDP model of development which is blind to people’s well-being.
3. Poverty In Rich Countries
The capability approach doesn’t need to distinguish between developed and developing societies. The per capita GDP is the common way to compare countries’ state of development. It is expected that economic growth should automatically make people’s life better but there is no straightforward relation between per capita GDP and quality of life. For example, Sri Lanka and the Indian state of Kerala have low per capita GDP but have higher life expectancies and literacy rates than richer countries like Brazil and South Africa. Likewise, the African Americans in the US have lower life expectancy than China or Kerala despite higher average income.
Clearly, growing national wealth doesn’t automatically translate into enhanced well-being of all people. Economic growth, as we notice around the world, tends to concentrate wealth in few richest hands and very little (sometimes hardly anything) reaches the poorest section of the society. Recent reports from Oxfam International points to the disturbing trend of rising inequality where wealth is increasingly concentrating in few hands. These reports are eye opening and underscore this point with global examples and highlight how the rich elites influence state policies in their favor, which excludes the ordinary citizens from the development process. Consequently, particularly those at the bottom remain trapped in system created state of deprivations.
The human development report of 1996 also pointed out: “The imbalances in economic growth, if allowed to continue, will produce a world gargantuan in its excesses and grotesque in its human and economic inequalities.”
4. Non-monetary Poverty
It is not sufficient to know how much access a person has to resources in order to know his capabilities – well-being he has achieved or can achieve. Rather, we need to know much more about the person and the circumstances in which he or she is living. The capabilities don’t refer exclusively to his abilities or internal powers, but it refers to an opportunity made feasible (and constrained by) both internal (personal) and external (social and environmental) factors.
Resource based theories do not acknowledge that people differ in their abilities to convert these resources into capabilities. The capability approach rejects normative evaluations based exclusively on commodities, incomes, or material resources. Resource- based theories do not acknowledge that people differ in their abilities to convert these resources into capabilities.
5. Importance Of Freedom and Democracy
As mentioned above “freedom” is a vital part of the capability theory. Lack of freedom limits people capabilities in different ways. But this freedom is not what is given on paper by the national Constitution; it is also not the right to vote in elections. It is the ‘real’ freedom enjoyed by individuals so that they can live their lives in the manner they want.
Likewise “democracy is best seen as governance by discussion” – namely, people’s participation and public reasoning. Citing the history of global famines, Sen asserts that “no famine has ever taken place in the history of the world in a functioning democracy”. He cites India’s example, “The prevalence of famines, which had been a persistent feature of the long history of the British Indian Empire, ended abruptly with the establishment of a democracy after independence.” This is because democratic governments “have to win elections and face public criticism, and have strong incentive to undertake measures to avert famines and other catastrophes”.
As a contrary historical example, he cites is the massive famine in China during 1958-61 during the failed ‘Great Leap Forward’, which claimed close to 30 million of lives. Loss of lives could have been avoided if people and the media in China had freedom to report the truth. For various self serving reasons local authorities also did not convey the ground reality to their top bosses.
In the context, particularly of poor nations, people often think that freedom counterproductive to both political stability and development. Thus, they recommend restrictions and authoritative rule. However, Sen takes the opposing view and cites the examples of Taiwan and Thailand and claims that the rapid transformation of East Asian economies resulted from the “social opportunities” provided by governments in the form of schooling, basic health care, basic land reform, and micro-credit. As a result of development, these economies became more democratic.
Taking the same logic forward, Sen points to the breakdown of former Soviet Union and asserts that political liberties are essential for sustainable development. Thus, comparing the development strategies of India and China he argues that democratic India holds more promise for a long term and sustainable development.
6. Development means Expansion of People’s Freedom
“The success of a society is to be evaluated primarily by the freedoms that members of the society enjoy.” – Amartya Sen
Freedom is the primary goal of development; freedom is also the principal means of development. It is “the enhancement of freedoms that allow people to lead lives that they have reason to live”. Thus, development is the process of expanding human freedom. It also means removal of contrary forces that restrict people’s freedoms such as poverty, all types of discrimination and inequalities, neglect of public facilities, lack of economic opportunities, social exclusion, authoritative state policies that limit freedom and so on.
He asserts that development is enhanced by democracy and the promotion of human rights – notably freedom of the press, speech, and assembly – because they foster clean, honest and accountable governance.
Development as Freedom!
In his book Development as Freedom, Sen prescribed five types of freedoms that “tend to contribute to the general capability of a person to live more freely.” They are interdependent and interconnected. Indeed, these interconnections are central to a fuller understanding of the instrumental role of freedom.
Political Freedoms: They essentially include functioning democracy, freedom to scrutinize and criticize actions of authorities, freedom of expression and speech, and presence of free press.
Economic Facilities: such as People’s opportunity to possess and use economic resources or entitlements.
Social opportunities: They include people’s ability to access health and education services, opportunities to participate in social processes and activities.
Guarantees of Transparent Governance: This concerns transparency in the functioning of authorities so that people can trust the system and information they receive.
Protective Security: This pertains to social protections of the vulnerable people so that they don’t fall into abject deprivation. It includes welfare programs and mechanisms to support and empower the weakest segment of the society.
Expanding these freedoms constitute not only the means, but also the end in development. The state must play its role in supporting freedoms by providing infrastructure and easy access to public services, social safety nets, good macroeconomic policies, and environmental protection.
7. Freedoms Supports Expansion of Capabilities
Freedom means having space to acquire capabilities and using them as one would want to. What people are “capable” of doing (achieving) is influenced by the freedom to avail economic opportunities and state programs and ability to enjoy political liberties and social powers.
It is necessary to evaluate the status of freedom enjoyed by the individuals so that effective developmental policies could be framed. In the context of anti-poverty programs, the individuals need to be seen as “agents of change” rather than “patients” diagnosed with the “illness of poverty”.
It means looking into their capabilities rather than just their income levels – more precisely, evaluating their deprivation in capability terms, not in economic terms. In other words, one needs to probe the potentials of the individual and the constraints in realizing them, as opposed to simply seeing their (often averaged out) income, consumption or expenditure. It will map out development in terms of freedoms (or their lack) enjoyed by individuals in the societies – it will be something like a Human Freedom Index.
Microfinance and Capability Approach
The Power of Micro-Credit!!
“The poor themselves can create a poverty-free world… all we have to do is to free them from the chains that we have put around them.” – Muhammad Yunus, Bangladeshi Nobel laureate of 2006 and founder of the Grameen Bank to help women and poor through micro-credit
The Grameen Bank has helped 10 million Bangladeshis move above World Bank’s $1.25-a-day threshold of extreme poverty.
8. People are “Agents” of Change
Sen sees people as “Agents” of Change, not passive recipients of benefits or mute followers of expert created policies. In Sen’s view, in the development process “people have to be seen … as being actively involved – given the opportunity – in shaping their own destiny, and not just as passive recipients of the fruits of cunning development programs.” So the central theme of development is to enable people to become agents of change in their own lives. When people, individually or in groups, are recognized as agents, they can define their priorities and also choose the suitable means to achieve them.
However, people differ in the ability to use the available freedom and choices and hence, in what they can achieve. In order to be good agents of change, people need the freedom to be educated and healthy, to speak in public without fear, to participate in the social and political processes, etc. On the positive side, once people have these freedoms they can themselves build the environment in which they can be educated, healthy and speak freely and participate, and so on.
9. Accepting Human Diversity
A unique feature of the capability approach is that it recognizes individual differences. Sen accepts this as ‘realism’ and steers clear of the stereotype idealism, ‘all men are equal’. He takes it as a fundamental aspect of our interest in equality” and does not consider human diversity as a secondary complication (to be ignored, or to be introduced ‘later on’!).
The capability approach categorically recognizes that there will be variations among people in conversion of resources into functionings and capabilities. These variations in conversion arise either due to personal or socio-environmental factors. The diversity will also be seen in the variations in the income-using ability of individuals, and also in their income-earning ability.
An important consequence of acceptance of diversity among people is that they can’t be assessed uniquely in terms of resources they posses; they can only be judged in terms of what they are capable of ‘doing’ or ‘being’ with the available resources.
Indeed, if people were not diverse, then inequality in one aspect (say income) would more or less be identical with inequality in another aspect like capabilities.
10. Poverty is Deprivation of Basic Capabilities
Poverty must be seen as the deprivation of basic capabilities rather than merely the lowness of incomes. – Amartya Sen
Sen has argued that poverty should be seen as the deprivation of basic capabilities, where that deprivation limits the freedom of a person to pursue their goals in life. For Sen “capability deprivation” is a better measure of poverty than lowness of income. For instance, in India over 50% of all malnourished children come from non poor families. When the Indian government claims that the poverty is down to 22% or 29% it is mere statistics that tells nothing about people’s state of well being, which ultimately depends upon what they can or cannot do – their capabilities. In the context of measuring poverty, Sen asserts that “identifying a minimal combination of basic capabilities can be a good way of setting up the problem of diagnosing and measuring poverty.”
In Amartya Sen’s view, all individuals are endowed with a certain set of capabilities. If situation is created so that they can realize their capabilities they will automatically escape from poverty (ie, from their state of ‘un-freedom’). If in today’s world of sheer abundance there are people living in poverty, they are living in a state of ‘un-freedom’, unable to realize their capabilities.
The capability approach has revolutionized the approach to development and poverty. It is taking the thinking into areas never considered relevant before. It recognizes the presence of poverty in the economically rich countries, again in terms of deprivation of capabilities. Inequality and social exclusion have emerged as two most common side effects of the current economic growth model. While it becomes only too obvious in the poor economies, it remains somewhat camouflaged in the opulence of the rich societies.
11. Influence of Amartya Sen’s Capability Theory
The Capability Approach has been highly influential in the context of international development. It has led to a paradigm shift in the understanding of ‘development’, away from the narrow confines of economic growth to a focus of “poverty as a denial of choices and opportunities for living a tolerable life.”
Despite the challenges, attempts to apply the CA have mushroomed in recent years. Among other things the CA has been used to investigate poverty, inequality, well-being, social justice, gender, social exclusion, health, disability, child poverty and identity. It has also been related to human needs, human rights and human security.
Numerous attempts have been made to apply the CA to the measurement of poverty and human well-being. While most applications focus on functioning, some studies have tried to capture capabilities in terms of freedom to choose or human talents and skills. Perhaps, the most well known measure is the human development index (HDI)of the UNDP, for which a significant contribution was made by Dr Mahbubul Haq – noted Pakistani economist (who died in 1998) and Sen’s lifelong buddy.
The first Human Development Report of 1990 defined human development as “a process of enlarging people’s choices” and stated that “income is a means, not an end” of human development (p. 10). It was a major shift away from seeing development as mere economic growth and towards sustainable human development. It underscored that the economic growth is not an end in itself; it is only an important tool to achieve the end goal, which is human development. Development ought to be people-centric and both socially and environmentally sensitive. The annual UNDP reports also began a process of questioning the wisdom of ‘trickle down’ economics.
12. Challenges in applying the Capability approach
Compared with the income perspective of development translating the capability approach into practice is quite challenging due to the emphasis on value judgments with high informational requirement and its multidimensional nature. In the capability approach the units of evaluations are not opulence (utilities, goods and resources) but functionings (doings and beings). People attach varying importance to different functionings; some functionings can be essential and important, others can be trivial and valueless. But ultimately it is their freedom.
A person’s freedom to live the way one would like has intrinsic value – it constitutes a person’s being. It means not only the achieved functionings are valuable but also the individuals’ capability to choose and discriminate among different possible living. Emphasis on freedom to choose also brings out the point that not any choice counts; but only those that reflect an expansion of valuable choices. These will be different for different individuals.
In ‘Development as Freedom’, Sen argues that “People have to be seen in this perspective, as being actively involved in shaping their own destiny (given the opportunity). They are not mere passive recipients of the benefits of the development programs.” This aspect emphasizes the role of individual’s initiative and their effectiveness in social settings.
Now the question is: how to put the capability approach into practice if the capability is a possibility (exercised or not) and not an actuality?
Since the capabilities denote potential opportunities they are not directly observable. Thus, the assessment of capabilities has to proceed primarily on the basis of noting the actual functionings; it can be supplemented by other information. It should work because the valuation of actual functionings is one way of assessing how a person values his options. A practical way is to combine the information from income data with social functionings. This should easily work at the macro level and not much difference is expected between the capability approach and other approaches that also explore development in terms of non-income variables.
However, at the micro level significant differences are expected where the capability approach (CA) allows people to express their ‘power of discrimination’ about what is good life for them.
Measuring Capabilities Require Different Procedure
The existing poverty evaluations rely on income surveys which provide no guidance for policy interventions other than economic growth through top-down approach. If expansion of human capabilities is going to be the prime goal of development, then progress need to be evaluated differently. Rather than income (or material) measures one has to now probe people’s capabilities.
To apply the capability approach, capability surveys need to be designed to assess capabilities and potentials, rather than incomes, in order to determine the constraints or un-freedoms that restrict capability expansion. The conditions leading to constraint are, by nature, subjective. Therefore, the input must come through a participatory process following a down-top approach, rather than from statistical analysis of ‘experts’.
13. Critique Of Capability Approach
Sen’s thesis is focused on individualism and localism. It almost entirely revolves around the individual – his abilities and choices. In short, it boils down to ‘what can I get from what I have, under the given conditions.’ His theory ultimately appears to come out in favor of capitalism running on principles of justice and good ethics. Yet he offers no strategy for creation of such good conduct. In reality, markets are everything but just or moral.
Impact of Global Powers and Processes
Amartya Sen’s theory is clearly a humane one and has won widespread acclaim, even by the mainstream economists. However, his thesis squarely rests on Western individualism and fails to provide critical analysis of major western states and institutions.
The focus of today’s mainstream development is on development of possessive individualism, where freedom means security of property and ease tradability in the market. This has entered into Sen’s development concept also. Thus, his theory is silent on impact of global capitalism; it ignores the problems of unequal trade rules that favour the rich corporations and individuals.
The current philosophy is represented in the Washington Consensus, trade liberalization, and in agreements such as the General Agreement on Trade in Services (GATS) and Trade in Intellectual Property Rights (TRIPS). What goes on in the name of liberalization actually breaks down the communities and sense of justice. Today, people who manage to gain good education and skills find themselves constrained by the way the market functions, which decides where they can sell their labor, to whom, for what price, and the manner how it is used. As a result, they are left with little freedom that Sen considers vital for ‘development’.
Meanwhile, the highly powerful “institution of speculators” and middlemen operate in a way that effectively decouples prices from the demand-supply equation of the market. Their manipulative tactics sap away considerable freedom of individuals – leaving them with practically no choice.
Sen’s theory assumes presence of an honest and just world which is ruled by the most ‘capable,’ which makes it an ideal theory without legs to stand on the uneven ground.
Conclusion
Despite the idealism, Amartya Sen’s capability approach to development has left strong impact on the global developmental discourse. It provides a unified view of development and poverty – the opposite side of each other. If development is expansion of people’s capabilities, poverty is just the opposite – deprivation of basic capabilities. The capability approach has put the idea of development in the right perspective by considering it as a multidimensional process that can’t be adequately viewed from any one dimensional lens such as economic growth. This then makes poverty also a situation with multidimensional deficits in development.
Since capabilities go hand in hand with freedom, the development must necessarily involve expansion of people’s freedom which creates an enabling atmosphere for building capabilities. This offers directional guidance to the policymakers. Development also necessarily involves identifying factors that go against such enabling environments. This takes the development discourse to social, political and (now) environmental platforms (due to worsening climate change issues) to uncover what restricts people’s freedom and choices.
Disclaimer
This page aims to convey basic ideas of Amartya Sen’s development theory for ordinary people. Much research has been done on capability theory. Students should consult relevant journals for better accuracy.
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