Poverty, Inequality, and the Erosion of Human Agency in South Asia: Psychological Mechanisms and Development Outcomes

This article examines how chronic poverty and inequality in South Asia constrain development through the erosion of human agency. Moving beyond income and multidimensional poverty measures, it conceptualizes poverty as a dynamic process that undermines individuals’ effective capacity to make choices, plan for the future, and act to pursue valued goals. Drawing on the capability approach and integrating insights from psychology and political economy, the study analyzes how stress, anxiety, and diminished perceived control mediate the relationship between material deprivation and development outcomes. Using a comparative framework focused on Pakistan, India, and Bangladesh, the article demonstrates that agency plays a central role in shaping the effectiveness of development interventions, helping explain why material gains do not consistently translate into sustained improvements in education, health, and livelihoods. The findings highlight the importance of restoring agency through stability, institutional reliability, and mental well being as a foundation for equitable and sustainable development.