Poverty UNIT 4 ECO

Página 1

What is poverty and inequality in developed and developing countries?

Relative Poverty - lacking enough to enjoy a similar standard of life to the rest of society, they can satisfy basic needs but lower than most of population (mainly developed countries i.e. UK)

In the UK there is an estimated 2.8 million children growing up in poverty ( Less than £300 per week for a family of 4.

Costs of Poverty - Poor standards of living, low life expectancy, health and mental problems,

Economic costs - increased crime ( i.e. thefts for food because can't afford to buy food), expenditure on benefits -> could be spent elsewhere -> IE NHS -> opportunity cost

Absolute Poverty - Is the absence of one or more factors enabling individual families to assume the basic responsibilities and to enjoy fundamental rights.

The basic rights ( i.e. if one or more of these is lacking could be considered to be in absolute poverty ( mostly in African countries, for example Ethiopia during the famine)

Food - BMI below 16

Safe Drinking Water - water solely from rivers/ ponds or unavailable -> less than 15 minutes walk away

Sanitation Facilities - No toilets accessible near home

Health - Treatment unavailable for serious illnesses or pregnancy

Shelter - More than 4 people living in one room, floors made of dirt, mud, clay.

Education - Lack of Schools

Information - lack of access to newspapers, radio, TV, computer or telephone

Access to services - lack of education, healthcare, schools, legal, social and financial services

Causes of Poverty

Primary Product dependency - i.e. sole export is one commodity or product, especially in LEDC's agriculturally dependent countries where if bad weather could cause a decrease in supply

Bad political system - i.e corrupt or incompetent government could prevent aid being used

Bad weather conditions / natural disasters

Lack of natural resources

Less education facilities

Tariffs

Geographical Terrain

Debt ( Cycle of Debt)

Civil Wars

Weak policies aimed at promoting growth

low FDI

Population growing faster than GDP

HIV/AIDS

Measures of Inequality

The Lorenz Curve - illustrates the distribution of incomes in an economy - the diagonal line represents the curve for perfect inequality this line of absolute equality shows what the wealth distribution would look like if there was no inequality