Are policies to reduce chronic poverty articulated in poverty reduction strategies (PRS) actually implemented in practice, and with what results? This study review the literature to address this question in the case of Nicaragua. Nicaragua is an interesting case: as one of the most highly indebted countries in the world, the offer of debt relief in return for formulating and implementing a PRS was eagerly accepted. Subsequently the country has enjoyed at least three advantages: substantial debt relief was granted in 2004, aid flows have been large, and unlike some developing countries, and indeed Nicaragua itself twenty years ago the nation is both at peace and politically stable. If a PRS was going to make difference, then, it should have done so in Nicaragua