- A Synthesis of the Making Markets Work for the Poor (M4P) Approach
First of three documents
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- Perspectives on the Making Markets Work for the Poor (M4P) Approach
Second of three documents
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- The Operational Guide for the Making Markets Work for the Poor (M4P) Approach
Third of three documents
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Approaches and methods - Poverty reduction through participation in economic growth1.2 billion people around the world are currently living on less than a dollar a day, mainly because they lack access to regular employment and reasonable pay. SDC is committed to effective, sustainable economic systems based on market principles, in which poor and disadvantaged members of the population can also take part – as employees, producers or consumers.
|•||Of the 1.2 billion people who live on less than 1 US dollar a day, 70% are women.|
|•||Since 2000, income poverty in China has not fallen despite double-digit growth, because the country's remote rural regions have had virtually no opportunity to participate in this growth.|
|•||Broad-based growth is a fundamental condition for achieving the Millennium Development Goals.|
|•||Young people account for almost half of all unemployed persons in the world.|
Economic growth is a prerequisite for sustainable development and poverty reduction in a country, but it is not a guarantee. Experience shows that growth can only contribute to broad-based poverty
reduction and to achieving other Millennium Development Goals if it results in more people, particularly the poor, gaining access to reasonably-paid, socially acceptable employment ("decent work")
and enables them to unleash their entrepreneurial potential. This is the criterion for the equal distribution of income and the participation of broad segments of the population in the market
One of the main aims of development efforts is to promote an efficient private business sector and properly functioning markets for labour, finances, goods and services. The main challenge in this context is to develop and promote such markets. At the same time they must be structured such that poor and disadvantaged segments of the population can gain better and sustainable access to them and derive benefits from the available opportunities.
Strategies for developing a market along these lines call for an in-depth understanding of market systems and the wide range of socio-economic barriers that currently prevent poor people from participating in economic growth. Such strategies must, for example, take account of the complex relationships between supply (producers) and demand (consumers), supporting measures (infrastructures, services), regulatory and legal frameworks, and the specific roles of the main actors – the private sector, state and civil society. Moreover, consideration must also be given to the varied dimensions of poverty and its causes, which determine the ability of poor segments of the population to earn higher incomes in future and enjoy the benefits of healthcare, education, social security and political participation.
|The SDC focus
The SDC bases its activities on a systematic approach to market development, in line with strategies which are summarised under the collective title "Making Markets Work for the Poor – M4P". The
common denominator of these strategies is that they define markets as socio-economic systems and endeavour to influence these markets so as to improve the opportunities of poor persons to take part
in them, whether as employees, producers or consumers.
The focus is on the following thematic areas:
Private sector development
As the driving force behind economic growth, the private sector is accorded a key role in developing and transition countries.
Providing poor households, farmers and small enterprises with improved access to financial services can boost their involvement in economic life and reduce their vulnerability.
Vocational skills development
The aim of vocational training is to create opportunities for productive employment and access to reasonably-paid work for all.
Additional Information and DocumentsDocuments
- M4P. A common framework for learning and managing change. Experience in the Balkans
Download (PDF, 136 KB) : [en]
- M4P. Improving the environment for small businesses in Indonesia and Russia
Download (PDF, 180 KB) : [en]
- Employment, Income and the MDGs - Critical Linkages and Guiding Actions
Download (PDF, 72 KB) : [en]
- M4P. Expanding the poor's access to business information and voice through radio in Uganda
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- M4P. The role and impact of radio in reforming the rural business environment in Africa
Download (PDF, 309 KB) : [en]
- M4P. Developing financial services markets for the poor: financial markets in South Africa
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- Comparative Approaches to Private Sector Development - a M4P perspective
Download (PDF, 270 KB) : [en] [fr] [es]