Robert Chambers and Gordon Conway defined sustainable livelihood and I quote;
comprises the capabilities, assets
, claims and access) and activities required for a means of living: a livelihood is sustainable
which can cope with and recover from stress and shocks
, maintain or enhance its capabilities and assets, and provide sustainable livelihood opportunities for
the next generation; and which contributes net benefits to other livelihoods
at the local and global levels and in the short and long term (Chambers and Conway 1991).
approach offers a holistic and integrative approach with the capacity to analyse and understand the complexity of rural development (Chambers and Conway 1991; Solesbury 2003).
(SL) framework is a term that covers research concerning poverty
reduction, sustainability and livelihood strategies. The SL framework is applicable to both rural and urban survival
strategies. The five assets in sustainable livelihood
are human capital
, physical capital, social capital, financial capital
and natural capital. These assets play an important role in survival strategies both in rural and urban livelihoods.
2.2.1 Human Capital
Human capital is a combination of knowledge, habits, social behaviour and personality that contribute to economic benefits for an individual and/or community (Ellis 1996
. This knowledge can be attained through education
, creativity, availability of skills
and talents, experience, training and exposure. Human capital also includes health of an individual, household
Education exposes an individual to new dimensions including reading and writing that are required to improve and attain skills
. Therefore education is a necessary investment for human capital. Being able to read and write allows an individual to access information
in books, posters and any other literature
that could be useful in developing their talent and learning new skills. Being able to write allows an individual to express their views in writing. With education
come skills; an individual will acquire certain skills through their education, thus an educated household
has a higher chance of gaining skills than a household without any education.
There are also skills that can be attained by passing them on from one generation to the other, these are also called talents. Such artistic skills may not require an education at all, but if an individual is educated they are able to boost their talents, for example exploiting markets that would not be accessible to someone without an education.
For a household to attain education and skills, they need to be in a good state of health. Illness disrupts a household in many ways, a sick individual will not be able to work, and this directly affects the flow of income. And if the individual who is sick is the one who provides for the household (bread winner), illness may result in serious disruption of the household status.
2.2.2 Physical Capital
Physical capital is an asset that helps to turn raw materials into finished products and/or services (Ellis 2000). Examples of physical capital include equipment such as a tractor on a farm, a sewing machine for a tailor, buildings and computers. Availability of physical capital boosts productivity and enhances income earned by a household. Physical capital allows for work to be accomplished faster as well as for diversification. To be able to make full use of physical capital, there is need for human capital, that is, the required skills, for example to operate machinery and to manage assets.
Social capital plays a major role in productivity
of an individual, organization and community (Ellis 2000
. Social capital refers to relationships, institutions and norms that shape societal interactions. Social networks are considered as horizontal associations between individuals, which increase productivity by reducing the costs of doing business and facilitate coordination and cooperation. Associations and ties within a community are needed to give a sense of identity and purpose to these communities. These ties are also a basis for access to information
that can be of great assistance to the community. One example is obtaining loans and/or credit
and funding (microfinance) for community projects which is a common occurrence in most developing countries.
can be defined as services in form of financial assistance for entrepreneurs and small businesses lacking access to banking and comparable services. Microfinance can be categorized as a tool for economic empowerment, health research development and for human development.
has brought financial security, social security and improved lives for many in developing countries. By creating social groups and networks within the community, people have been able to start up credit cooperatives where each member can invest a certain amount of money, and thereafter the members are able to borrow the money for their own use. Community participation in microfinance activities has been successful because individuals see the benefits from their participation (Kondo et al. 2008; Moll 2005; Quirós and Gonzalez-Vega 2007; Yadav 2014). Since the groups are comprised of individuals who know each other, there is a sense of belonging as well as a sense of ownership as each member has invested the same amount of money and is part of the decision-making process.
Saving and credit cooperatives and social cash transfer programmes have improved livelihoods but also brought challenges to many. Those who are not able to repay loans have lost their property to the credit organizations to which they owed money. For the successful ones, members of the groups are able to finance their businesses, support their households and are able to diversify their livelihoods because they have a financial security through the cooperative (Gibbs et al. 2012). These credit groups also provide money as start-up capital for small businesses. Most of these social credit groups are comprised of women who donate cash to a group account organized by the group members. After a period of time they rotate who can borrow the money from the group and the individual has to pay back the money within a certified period with interest. The social and financial security provided by the credit cooperatives allows for compliance, thereby success of the groups.
The link between health, poverty and livelihoods is critical when analysing the importance of microfinance. Lack of employment and/or loss of livelihood, the impact of HIV/AIDS and other chronic illnesses on a household and lack of income have rendered both men and women vulnerable to poverty. This in turn fuels inequalities and vulnerable communities resort to livelihoods that are unsustainable, affecting the health and well-being of both men and women in different ways (Kim et al. 2009). Microfinance
is therefore not only a source of income, but one way to develop a community to attain sustainable livelihoods.
Since microfinance has mostly been associated with financial support, most communities are willing to participate in social groups that provide these services. Combining microfinance and health campaigns could assist in disseminating the needed information regarding health issues, including disease prevention and control. This concept was tested in South Africa where a health training component was added to group-based microfinance programmes. The outcomes showed that it is possible to achieve broader health benefits when there is partnership between health, economic and social sectors when implementing interventions (Kim et al. 2009).
Apart from economic empowerment for small-scale entrepreneurs can microfinance be beneficial in health research? Most developing countries suffer shortages of well trained-health personnel which have contributed to the underperformance of health systems and primary health care. Is it possible to create saving and credit cooperatives that can support health research and health service delivery in developing countries? A concept of micro Research or microgrants was put forward where small grants could be provided to researchers in developing countries (Boccia et al. 2011; Geissler and Leatherman 2015; Kollmann et al. 2015; Seiber and Robinson 2007). The challenges associated with this concept though, have been that most often the donors for the microgrants already have selected subjects that they are interested in, which most often are not the pressing needs in the affected countries (MacDonald and Kabakyenga 2008). Secondly, this is not a sustainable solution as microgrants are only given for a short period of time and when the grant runs out, the study is abandoned. This creates not only false hopes in the communities where the studies are conducted but also a lack of trust in groups that come with health interventions into the community due to lack of long-term benefits.
A great example of micro credit and human development is the Bangladesh Rural Advancement Committee (BRAC). The programme which started in Bangladesh in 1972 has over the years expanded into 10 countries in Asia (Afghanistan, Sri Lanka, Pakistan and Philippines), Africa (Tanzania, Liberia, Uganda, Sierra Leone and South Sudan) and in the Caribbean (Haiti). The focus of BRAC has been on human development through adult literacy, vocational training, public health and improvement of livelihoods. The target populations for BRAC are the poorest of the poor, the landless, small farmers, artisans and vulnerable women. Through provision of micro loans, including follow-up and careful evaluation of their work, BRAC is a success story in the use of microfinance for human development.
Even though microfinance has helped others to boost their businesses and attain financial security to others, it is the contrary (Kondo et al. 2008; Odi et al. 2013; Sharma 2001). Instead of improving their livelihoods, to some microfinance has plunged them into utter poverty. This has led to lack of willingness in participating in development projects with a microfinance component. This has also led to the development of local microfinance schemes based in social networks within the community. Since members decide on the conditions of repayment, the conditions are manageable. Most people in rural areas in developing countries are already struggling with poverty and while microfinance schemes might provide financial security to some, shocks such as disease can easily affect the financial stability of a poor household. In case of illness within the household, finances might be easily channelled from businesses to support the health expenditures, thereby affecting the business. For the very poor, microfinance schemes may seem out of their reach, because they have neither the resources nor collateral to obtain the loans (Buckley 1997; Littlefield et al. 2003; Nasir 2013; Swope 2007). Training schemes that can instill skills in disciplines such as sustainable agriculture, and how communities can use the available resources sustainably at the same time improving their livelihoods, could also be of greater benefit to the rural poor.
2.2.4 Case Scenarios—Microfinance
Maisha; Agricultural intervention and HIV health outcomes (Cohen et al. 2015)
This was a multi-sectoral agricultural and microfinance intervention carried out in two districts in Kenya which depend on farming and fishing. The study area is vulnerable to drought and has an HIV prevalence of 15.3 % (Kenya National Bureau of Statistics and ICF Macro 2010). The project was designed to:
Improve food security
HIV clinical outcomes
The outcomes of this pilot study were that there was high acceptability in recruitment; the micro-irrigation water pump proved to be labour saving and the initiative delivered strong financial and agricultural training. Despite these successes, the challenges experienced were:
Weather patterns that affected agricultural productivity;
A challenging partnership with microfinance institutions;
Concerns on repayment of loans.
BRAC in Afghanistan
A collaboration between developing countries (Chowdhury et al. 2006)
In 2002 BRAC, a Bangladesh-based NGO whose main focus is setting up development programmes, especially in the rural areas and targeting the most vulnerable populations, went into Afghanistan to assist the country with its development programmes.
In Afghanistan, BRAC managed to set up development programmes in health, education, agriculture, community development and provided microfinance services by providing loans to small businesses. Through the loans, some women who lost their husbands to the war and were selling fruit and vegetables to earn a living were able to educate their children and expand their businesses.
Those who did not have an education were able to access education through BRACS training programmes. BRAC was also able to train community health workers who served the health needs in their communities.
2.2.5 Financial Capital
Financial capital refers to any liquid medium or mechanism that represents wealth such as money, purchasable items, savings, credit
, etc. It can also be defined as saved-up wealth that can be used to start-up or maintain a business. Availability of capital allows for growth of a business through innovation, diversification and skill enhancement; i.e. engaging in activities that will assist in earning income and resources needed by the household.
2.2.6 Natural Capital
Natural capital is the basis of all human economic activity. Natural capital includes land
, air, living organisms and all ecosystems on the Earth that are necessary for human survival
and well-being. In general, natural capital refers to natural resources (Barbier and Hochard 2014; Ellis 1996, 2000
All the five SL assets
outlined above are important aspects to livelihood
both in the urban and rural setting. In order for a livelihood to be sustainable, and for a household to survive, there is need for a household to diversify.