The clothing store next door to Antonia's had to shut down because they didn't have a sewing machine and still worked manually. The owner, Marco, eventually got a loan as well in order to buy a sewing machine. So did the seamstress Claudia from across the street.

Antonia, having being in business first, had a solid customer base. However, Claudia launched the arrival of her new machine with a 50% promotion. Residents of the neighbourhood soon discovered that Claudia was a superior craftswoman. Soon, some of Antonia's and Marco's customers began leaving their shops for the better service across the street.

Marco, the poor sap, was going out of business when a great idea occured to him: why don't he and Antonia go into business together? They knock down the wall and match Claudia's prices, while offering half the production time and investing their assets in an automatic pattern maker.

In the meanwhile, sewing machine manufacturers noticed how accessible their sewing machines had became and started having trouble meeting demand. They had no choice but to increase the prices. Soon, $150 was no longer enough to buy a sewing machine. Furthermore, Antonia and Marco dominated the textile market in their respective city and competition could not stand a chance.

Success is often associated with personal ingenuity, and rightly so. Ideas like microcredit can work for a while, but it's not a long term "solution to poverty". It is nice to think that $150 bucks can get someone out of the hole for the rest of their lives, but the repercussions of foreigners attempting to create a goods and services market economy where none existed can be catastrophic. Advancement comes from within. It's for this reason that initiatives like "affirmative action" is absolute hogwash.

Have a read here: http://en.wikipedia.org/wiki/Parable_of_the_broken_window

I can't believe I'm going to give the pro-business response, but don't those growing businesses employ people, and provide them with a steady income, hence lessening poverty?

Not every $150 dollar investment has to create a textile empire for the entrepreneur who receives the loan for this to help reduce poverty.

In a rich country, it can be very challenging to find "low hanging fruit" like this, but in a poor country, it can take surprisingly small amounts of money to spark a flourishing, lasting business.

Yes, capitalism has its own shortfalls, and without the proper governmental framework, it can turn into hell on earth all too quickly (see the parable of the Bush administration), but I think most people would agree that trading the issue of abject poverty for the issues of anti-competitive economic activity is still a step in the right direction.

societal wealth is a gaussian measured in dollars per person. thus, poverty may be reduced via increased efficiency of production or decreased population density.

if you have a number of failing students in a class do you:
a. kick the failing students out
b. make the course easier
c. give some of the points from the A students to the F students, leaving everyone with Bs, Cs, and Ds
d. make the A students tutor the F students
e. teach more effectively so that the whole class can learn better
f. do nothing

i'm cool with helping as long as i'm not forced to.
broken window doesn't really apply, and even if a seamstress empire were to grow, it wouldn't make things any worse by bringing capital into the town.

Moving this video to NetRunner's personal queue. It failed to receive enough votes to get sifted up to the front page within 2 days.