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The core institutional problem is the unresponsiveness of many institutions to the needs of poor people. On the single case study in theoretical contributions from political economy and political science and policy analysis are brought in the picture. A new mixed approach to account for the multidimensional poverty and the capability that combines a static set of core dimensions with mechanisms of deliberative participation. On Sen s theory, the participatory assessment methods and data reduction techniques together with linear regression models to measure the capabilities of poor people. Qualitative Comparative Analysis as well as models of regression analysis is to analyze the configuration of grassroots institutions and the poor people s characteristics. Core conclusion is that the formal institutional logics do allow some needs of poor people to be taken into account, but that this does not empower the poor themselves. Further, a strong civil society, combined with the directinvolvement of poor people themselves, empowers the poor people at the collective choice level and leads to the best responsiveness of institutions to the poor people s needs.