Promoting Livelihoods

As Hande and other SELCO Foundation staffers acknowledged, the goal of helping the rural poor secure better livelihoods represented a different kind of challenge than that of bringing DRE solutions to healthcare or education.  For education and healthcare, successful innovations were focused on facilities (schools and clinics) that could be structured in a similar fashion no matter where they were found. On the other hand, livelihoods differed from one village to the next and even within a village from one household to the next. Livelihood promotion required designers to pay very close attention to village life and household dynamics.

The word ‘livelihood’ is not much used in developed market economies. One speaks of ‘jobs’ or ‘businesses’ rather than the more all-encompassing idea of a livelihood. The market economy has created sharp boundaries between various spheres of activities. One’s job or business provides an individual with money that the individual then uses to purchase those items needed to sustain themselves. And for policy makers in developed economies whose goal is to improve the material condition of people’s lives, the objective tends to be increasing the number of jobs, enhancing the conditions of employment, or simplifying an individual’s ability to start a business.

However, livelihoods in a developing economy, especially among the poor, represent a far more complex portfolio of activities. Wage or business income may be one source of money to buy goods, but most households engage in other activities to further their economic condition. Members of the household often produce subsistence goods for themselves first, with livelihood activities that generate income in the market a secondary consideration. A SF field worker observes,

There is income diversification in the villages.  Households farm vegetables, as well as raise poultry and pigs both for their own sustenance and for sale. When we approach them, we find out what income is generated out of these different livelihood activities. And from this, we can see if a particular solution will help enhance the income that they're earning, especially considering the other livelihood activities that they have.

Designing an intervention to enhance a portfolio of livelihood activities represented a challenge and an opportunity. With a limited number of hours in a day, activities impinge on one another. Time spent processing rice is time that is not available for mending clothes. On the other hand, the great variety of tasks, while exhausting, can also provide some diversification and stability. If one household enterprise fails for unforeseen reasons, other activities can make up some of the deficit.

In designing a DRE intervention, SF had to be mindful of the interrelated nature of the various economic activities and their consequences for household income. Ideally, an intervention would make use of a household’s available labor and resources, utilizing otherwise less productive time or assets. An intervention could lead directly to earned income or it could free up time that would allow members of the household to pursue activities that would produce income. In addition, an intervention might have a health benefit, reducing illness and toil and thereby increasing energy to do other things.

Conversely, even an income-generating activity could negatively affect a household, tying up time or capital that could be used on other activities. Hande remembered one intervention the Foundation tested with a solar-powered press that made cooking oil. The machine worked as expected, but the time required to operate the machine and the rate of return it generated could not compensate for the lost time spent doing other activities.  While the device ‘succeeded’, the intervention left the households worse off than they were before.

Villagers, themselves, proved to be the best guides for designing interventions. Hande observed that household microentrepreneurs were innately aware of the ecosystem in which they operated. They built up considerable knowledge about the best ways to procure resources, produce products, and sell their goods. The Foundation had to harness these insights as it mapped potential DRE interventions.

The payoffs for success could extend beyond its user. While interventions were targeted at a single household, an intervention that promoted the livelihood of one household could also have spill-over effects, improving the livelihoods of other households in the village. For example, if one household installed and operated an electric rice-hulling machine, other households could, for a fee, run their paddy rice through the mill for dehusking and cleaning. This would free other households of this backbreaking, time-consuming labor, and allow them to engage in other activities.