Poverty

Poverty Socio-Economic Condition Standard of Living Income Wealth Subsistence Health Economic Inequality
Poverty is a socio-economic condition where an individual or a group lacks the financial resources and essentials for a minimum standard of living.
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Definition

Poverty refers to the state in which individuals or communities lack the financial resources to attain a minimum standard of living. It can be defined in both relative and absolute terms:

  1. Relative Poverty: This is a condition where an individual’s income and wealth are significantly below the average income of the society in which they live, hindering their ability to maintain a standard of living considered acceptable by society.
  2. Absolute Poverty: This condition occurs when individuals have such low income and wealth that it is insufficient to maintain life and health at a subsistence level, which includes basic needs like food, shelter, and clothing.

Examples

  • Relative Poverty: A family in a wealthy country unable to afford basic amenities like housing, healthcare, or education, even though their income might be higher than those in less affluent nations.
  • Absolute Poverty: A person living on less than $1.90 a day in a developing country, which is considered the international poverty line by the World Bank.

Frequently Asked Questions

What is the difference between relative and absolute poverty?

Relative poverty is context-specific and measures one’s economic status compared to others in the society, while absolute poverty is a universal measure based on the inability to meet basic survival needs.

How is poverty measured?

Poverty is measured using various indices like the Poverty Threshold, Poverty Line, and Multidimensional Poverty Index (MPI), which consider income levels, standard of living, and access to essential services.

What are the main causes of poverty?

Poverty can be caused by multiple factors including economic inequality, unemployment, lack of education, poor healthcare, and systemic issues such as corruption and political instability.

How does poverty affect health?

Poverty can lead to malnutrition, inadequate access to clean water and sanitation, and limited access to healthcare services, all of which negatively impact overall health.

What are some global initiatives to reduce poverty?

Global initiatives include the United Nations’ Sustainable Development Goals, the World Bank’s programs to reduce extreme poverty, and various non-governmental organizations’ interventions focused on education, healthcare, and economic development.

  • Standard of Living: The degree of wealth and material comfort available to a person or community.
  • Subsistence: The minimum level of income deemed adequate to maintain basic living conditions.
  • Economic Inequality: The disparity in the distribution of income and wealth across various segments of society.
  • Poverty Line: An income level below which an individual or family is considered economically disadvantaged.
  • Multidimensional Poverty Index (MPI): A measure that assesses poverty using multiple indicators, including education, health, and living standards.

Online References

Suggested Books for Further Studies

  • Poverty Topics in Middle Slavic Contexts by Michael Ferber
  • Ending Global Poverty: A Guide to What Works by Stephen C. Smith
  • Poor Economics: A Radical Rethinking of the Way to Fight Global Poverty by Abhijit V. Banerjee and Esther Duflo

Fundamentals of Poverty: Economics Basics Quiz

### How is relative poverty defined? - [x] As a measure of income and wealth significantly below the societal average. - [ ] As having income below $1.90 per day. - [ ] As a standard of living exactly equal to the subsistence level. - [ ] As a measure universally applicable to all countries. > **Explanation:** Relative poverty is specifically defined as having income and wealth significantly below the average within the context of a given society. ### What is the international poverty line as defined by the World Bank? - [ ] $3.00 per day - [ ] $5.50 per day - [ ] $2.00 per day - [x] $1.90 per day > **Explanation:** The World Bank defines the international poverty line as living on less than $1.90 per day. ### Which type of poverty assessment considers factors like education, health, and living standards? - [ ] Relative poverty measurement - [x] Multidimensional Poverty Index (MPI) - [ ] Absolute poverty measurement - [ ] The Poverty Line > **Explanation:** The Multidimensional Poverty Index (MPI) assesses poverty using a broad range of indicators, including education, health, and living standards. ### What fundamentally causes absolute poverty? - [x] Income too low to meet basic survival needs. - [ ] Ownership of material wealth. - [ ] Comparisons in income distribution. - [ ] Economic performance alone. > **Explanation:** Absolute poverty is fundamentally caused by having an income that is too low to meet basic survival needs such as food, shelter, and clothing. ### What aspect of poverty does the 'Poverty Line' measure? - [ ] The wealth of the richest societal group. - [x] The threshold below which individuals are considered economically disadvantaged. - [ ] The average income of a society. - [ ] The economic inequality in capitalism. > **Explanation:** The 'Poverty Line' measures the threshold income level below which individuals or families are considered economically disadvantaged. ### What global initiative includes goals to end poverty in all forms everywhere? - [ ] Paris Agreement - [ ] World Economic Forum - [x] United Nations Sustainable Development Goals - [ ] International Monetary Fund > **Explanation:** The United Nations Sustainable Development Goals (SDGs) include goals to end poverty in all its forms everywhere. ### How can poverty impact health outcomes? - [x] It can lead to malnutrition and limited access to healthcare. - [ ] It always increases life expectancy. - [ ] It has no correlation with health outcomes. - [ ] It results in better personal health. > **Explanation:** Poverty can severely impact health outcomes through malnutrition, inadequate healthcare, and poor living conditions. ### What is a significant global strategy to reduce poverty? - [ ] Relocating the impoverished to wealthy areas. - [x] Empowering individuals through education and economic development programs. - [ ] Providing short-term financial aid only. - [ ] Ignoring poverty statistics. > **Explanation:** A significant strategy to reduce poverty includes empowering people through education, economic development programs, and sustained efforts towards improving living conditions. ### Which organization monitors and reports on global poverty levels? - [ ] International Red Cross - [ ] World Health Organization - [x] World Bank - [ ] Greenpeace > **Explanation:** The World Bank is one of the primary organizations that monitor and report on global poverty levels and efforts to reduce them. ### According to the UN SDGs, by which year is the goal set to end extreme poverty for all people everywhere? - [ ] 2030 - [ ] 2025 - [x] 2030 - [ ] 2040 > **Explanation:** According to the United Nations Sustainable Development Goals, the target year to end extreme poverty for all people everywhere is 2030.

Thank you for exploring the in-depth aspects of poverty and testing your knowledge with our quiz. Keep striving for a deeper understanding of socio-economic dynamics!

Wednesday, August 7, 2024
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