There has been growing academic and global interest on the relationship between extreme poverty and self-efficacy. According to Wuepper, D., & Lybbert, T. J. (2017), traditionally focused on external constraints, economists are increasingly recognising the importance of internal constraints that reflect perceptions as much as reality.
Background
Self-efficacy, a concept introduced by psychologist Albert Bandura, refers to an individual’s belief in their capacity to execute behaviours necessary to produce specific performance outcomes. It is the confidence in one’s ability to influence events and control over one’s environment. Rooted in a person’s particular set of belief, self- efficacy determines how well one can execute a plan of action in prospective situations (Bandura, 1977). Simply, self-efficacy is a person’s belief in their ability to succeed in a particular situation.
For communities and households experiencing extreme poverty particularly due to conflict and displacement, limited socio-economic opportunities and societal marginalisation, majority face complex and multifaceted challenges that compound their cycle of poverty. These include inadequate access to education, information, productive work, and basic needs all which negatively affect their self-efficacy. Equally, their low self-efficacy negatively affects and influences their drive for knowledge, skills, relationships, motivation, beliefs and hopes for a better tomorrow in turn affecting their productivity.
The programme dispensing the skill
The Sustainable Market Inclusive Livelihood Pathways to Self-Reliance (SMILES Project) delivers a graduation model integrated with a Market System Development approach, targeting women, youth, and their household members in order to achieve its goal. Recognising the importance of self-reliance in an individual’s development, all relevant components implemented in the project are tailored to harness and grow a primary participant’s self-efficacy. Central to this is a unique and contextualised methodology in the project’s Graduation Approach, focusing on three pillars, namely, “I Can, I Have, I Am”, to promote performance outcomes; vicarious experiences, psychological feedback, and verbal persuasion – all important facets of self-efficacy. Utilising the Graduation Criteria which includes self-efficacy as a domain, the project is able to track participant progress toward strong and positive self-efficacy outcomes.
What we did: unpacking the three pillars
The ‘I Can’ pillar emphasises the recognition of one’s own abilities and potential–an understanding of what an individual is capable of based on their personal skills and competencies. For example, a person may be able to bake, sing, or work in marketing, among many other areas. By identifying and focusing on these strengths, individuals build the confidence required to take decisive action towards their personal growth and development.
The ‘I Have’ pillar refers to the supportive network of relationships in an individual’s life, including friends, family members, colleagues, and the wider community, which strengthens one’s sense of trust and belonging. This network also provides a reliable safety net when support is needed. When individuals have meaningful ‘I Have’ resources, their self-efficacy strengthens over time.
The ‘I Am’ pillar focuses on awareness of one’s personal beliefs and values. When individuals understand and appreciate their own beliefs and values, they are less likely to be influenced by the actions or opinions of others. Instead, they make decisions grounded in their own principles, which in turn strengthens their self-efficacy.
These powerful psychological constructs shape how people approach challenges, persevere in the face of setbacks, and ultimately achieve success. When applied within graduation programmes of extremely poor people, these pillars play a critical role in building self-efficacy, which is a key determinant of whether participants will graduate to resilience through difficulties or drop out before graduation.
The SMILES Project Graduation Approach has employed a range of strategies to ensure the self-efficacy of participants is effectively reinforced. These efforts have yielded positive results, as evidenced by data collected on a quarterly basis and testimonies shared by project participants. The strategies include:
Role models: Exposure to individuals who have successfully graduated despite similar hardships reinforces the belief that success is possible. This strategy builds on the pillar of ‘I Can’ which enables the participants to realise their potential. This is achieved through allowing participants to share their experiences specifically targeting those who are progressing well towards graduation.
Mentorship and Coaching: The ‘l Can’ pillar is further strengthened by equipping participants with knowledge and skills that boost their confidence in utilising available resources and opportunities to achieve their goals. Within the SMILES Project Graduation Approach, participants receive training in areas, including Village Saving and Loans Associations, financial literacy, Farmer Field and Business Schools, Selection, Planning and Management, parenting, nutrition, preventive health, conflict management negotiations. This gives them confidence to take meaningful steps towards their graduation.
Social capital: The group-based approach, brings together 20-30 participants on a weekly basis for various activities. This setup fosters interaction among community members, augments group cohesion hence building the ‘I Have’ pillar. Additionally, the programme incorporates a buddy system, where participants are randomly assigned a peer to serve as a support system for their household. This approach strengthens participant self-efficacy by providing a sense of belonging and a reliable support network.
Throughout implementation, the participants are accompanied, guided and motivated, while being encouraged to take lead in deciding the pathways they wish to pursue. This approach–placing participants in the driver’s seat of their own development–helps to awaken their beliefs and values, thereby strengthening the ‘I Am’ pillar.
From 'I Can't' to 'I Can': The silent strength behind Graduation programming
As self-efficacy is strengthened, the SMILES Project participants demonstrated improvements across multiple domains that contributed to their successful graduation from the programme. While the participants built their confidence and developed self-belief, they became more aware of their potential and open-minded about the effective use of the available resources, which enabled them to achieve their goals.
This newfound confidence also enabled participants to form friendships more easily, thereby expanding their social networks, which played a supportive role throughout their journey to graduation. Data from the 10-item General Self-Efficacy Scale indicates a substantial increase in self-efficacy, rising from 30.5 percent at baseline to 99.8 percent 24 months later. In addition, 95.5 percent of the participants demonstrated a positive attitude towards their own economic improvement while graduation rates reached 93.6 percent by the end of the 24-month period.
Participants also demonstrated improvements in several key areas:
- Improved performance: Participants with higher self-efficacy set realistic goals and remain more focused on achieving them.
- Resilience against challenges and shocks: Economic hardships–such as food insecurity, healthcare costs, loan burdens–as well as social barriers including lack of support system, language barrier, and disability can easily lead to dropout of participants. However, strong self-efficacy fosters resilience, enabling participants to view challenges as temporary obstacles rather than insurmountable barriers.
- Enhanced motivation: Individuals with strong self-efficacy are more likely to stay committed to their goals since they believe in their ability to succeed.
- Enhanced problem-solving skills: Individuals with high self-efficacy are less likely to feel helpless when faced with adversity. Instead, they take proactive and constructive steps to address challenges, such as seeking financial assistance, sharing concerns with buddies, or accessing relevant support services.
- Positive mental health: Belief in one's abilities reduces anxiety and stress, making the participant more focused, intentional and effective in achieving goals hence graduation.
Conclusion
Self-efficacy is a critical determinant of successful graduation, particularly for individuals striving to overcome the challenges associated with extreme poverty. While financial support, technical skills and coaching are essential components of graduation programmes, they are not sufficient on their own. Sustainable transformation occurs when participants develop confidence in their own capacity to set meaningful goals, take decisive action and persevere in the face of setbacks. Interventions that deliberately prioritise the development of self-efficacy enable beneficiaries to transition from dependence to self-reliance. In the absence of this internal confidence, even well-designed interventions may have limited impact, as participants may be reluctant to take initiative, find it difficult to sustain progress, or lose momentum when confronted with challenges.
Therefore, organisations implementing graduation and livelihoods programmes should prioritise self-efficacy as a core component rather than an add-on. This requires the deliberate integration of mindset-building activities, consistent coaching, peer support mechanisms and opportunities for participants to achieve small, incremental successes that reinforce confidence. By doing so, programmes can accelerate graduation from extreme poverty while laying a strong foundation for long-term self-reliance and resilience. A call for commitment to designing interventions that empower individuals not only with resources, but also with the belief that they have the capacity to shape their own futures.
