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: who own land own tiny amounts of it, and most of it is not irrigated. Non-agricultural businesses tend to be too small scale to be efficient and staffed largely by family members. This clearly reflects lack of employment opportunities as well as lack of access to financial markets. An important policy question is whether to subsidise or encourage this form of “petty” entrepreneurship (e.g., through microfinance) or whether to expand formal sector employment opportunities.

Access to infrastructure (for example, roads, electricity, water and sanitation) is a key element of quality of life. While poverty is measured in terms of private consumption, this is too narrow a view. Two groups of people with similar private consumption will have very different qualities of life if there are significant differences in their access to safe drinking water or medical care. From the evidence presented by this study (table 3), it appears that there is enormous inter-country variation. For example, in Tanzania electricity is available to only 1.1% households in the sample, whereas in Mexico to 99%. What is also clear is that there is variation within each country in terms of access to different types of infrastructure. In Indonesia, 96.9% households in the sample have access to electricity, and yet only 30.5% have access to toilets/latrines. This poses a challenge to economists to come up with better measures of poverty that put weight on deprivation in these dimensions. This also should give a moment of pause to those who have full faith on trickle-down economics: economic growth will not automatically take care of these problems.