The empty rhetoric of poverty reduction at the base of the pyramid

Abstract

This article criticizes recent Bottom (or, Base) of the Pyramid (BoP) approaches for 'cancelling out politics' by obscuring unequal power relations at different societal levels and painting an optimistic picture of win-win outcomes that will make (some of) the world's biggest corporations richer while simultaneously adding a few crucial pennies to the pockets of the poor. The article is thus positioned within a growing stream of literature critical of BoP ideas, but it goes further than existing critiques by arguing that the current BoP discourse serves an important ideological function for global capital, specifically producing a discursive depoliticization of its corporate interventions in the lives of the world's poor. We argue that the poverty-reduction outcome of a BoP venture is contingent on its practice on the ground, which will inevitably be shaped by local and global power relations. In particular, we point to three cultural-political issues overlooked by the BoP discourse, which are vital in understanding the practice of business ventures at the BoP: adverse power relationships within poor communities; social-epistemological hierarchies between the poor and outsiders who administer poverty-reduction interventions; and local vulnerabilities induced by global currents in products, services, information and ideologies.Recent business school writing on the Base of the Pyramid (BoP) makes the grand claim that

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“…They also include critical feminist groups claiming more attention should be given to gender empowerment and equality issues [47][48][49]. Other scholars claim that a development discourse based on market-based approaches and technology transfer reflects and promotes neoliberal hegemonic thinking in developing countries [50,51]. In response to those criticisms, a more recent wave of BOP studies have reframed the role of the poor from mere recipients to co-creators of innovation [40,52].…”

Cultivating Compliance: Governance of North Indian Organic Basmati Smallholders in a Global Value Chain

“…One route to reducing any adverse impacts of this disjuncture may be through participatory 'democratic' deliberation of the standardmaking process (before the enactment on farms), opening it up to non-experts (Busch, 2012). However, three decades of experience with participatory development in the third world has shown that even in open consultative initiatives, knowledges and exigencies of some people are marginalized (for a recent review, see Arora and Romijn, 2012). The latter generally were the less privileged members of assumed communities of the poor or smallholders.…”

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“…Such a stance would escape the 'development versus exploitation' debate, by suggesting that frugal innovation seeks to combine local ideas and knowledge with international expertise in inclusive value chains to develop low-cost products that enjoy maximum user value (Bhatti, 2012). Still, detailed empirical studies are required to ascertain whether frugal innovation will lead to equitable economic growth or whether it will merely sustain existing inequalities (Arora and Romijn, 2011). One case that can illustrate the previous debates is the example of mobile money services in Kenya (M-PESA) and Zambia (Zoona).…”

“…Private Sector Development (PSD) entails a valorization of private enterprise, market efficiency, entrepreneurship and the conviction that markets can work for the poor (Schulpen and Gibbon, 2002;Blowfield and Dolan, 2014). This has far-reaching consequences for developing countries, as PSD discourse holds that business might succeed where governments and aid donors have failed, namely in alleviating or even eradicating poverty (Arora and Romijn, 2011). The dominant innovation trajectory has, thus, by necessity been challenged by new paradigms such as frugal innovation (Hammond et al, 2007;Kaplinsky, 2011;Radjou and Prabhu, 2014).…”

“…Critical approaches to the BoP literature suggest that a better understanding is required on how corporate profits and the needs of the poor might be combined, whereas others simply outright dismiss such possible win-win scenarios (Cross and Street, 2009;Arora and Romijn, 2011). BoP rhetoric might even aggravate poverty and inequality, by reconstituting the poor as 'modern' and value-conscious consumers, with unmet needs and wants that can only be satisfied through capitalist enterprise and market involvement (Dolan, 2012).…”