Saquib Ali Shahid Ali Khan
M.A. I
Roll no. 1803
Economic Growth and Poverty
Economic Growth
Economic growth can be defined as an increase in the productive capacity of an economy over a period of time. This is generally measured by comparing GDP of a year with the previous year’s GDP of a country.
Poverty
Poverty is defined as a poor economic or financial condition of an individual or a group of individuals – generally a family – who are unable to meet their basic needs like food, clothing, shelter, and in modern times, it includes education.
This generally implies critically low income groups created by over-population, lack of employment opportunities, and further, the lack of government intervention in dealing with such issues.
Economic
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The government can achieve this if a significant amount of investment expenditure is on human development, i.e on education and health of the poor. Essentially, the only source of income for the poor is labour. Therefore, the government can play an important role here by increasing the productivity of labour through providing education, health care and technical skills.
Kerala is one of the best examples here – where a very high rate of literacy, of about 90 per cent, has proved extremely successful in reducing rural poverty. In contrast, Bihar is characterised by an abysmally low literacy rate and hence, has shown the weakest rate of poverty reduction.
Further, the impact of economic growth on poverty is also affected by the extent of inflation that accompanies growth. High inflation rate accompanying economic growth reduces the purchasing power of the people and therefore, has an adverse effect on poverty. Thus, a higher rate of inflation would mean more people below the poverty line.
Economic growth should be pro-poor or inclusive and the strategy of growth should be such that it generates employment opportunities for the poor in agricultural, industrial and service sectors at reasonable wages – which would help them to meet their basic and minimum
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The first approach is based on the assumption that the benefit of economic growth trickles down to the poor in the long run and thus, achievement of a higher rate of economic growth will result in reduction and removal of poverty. Therefore, through this approach, emphasis was laid exclusively on attaining higher economic growth to eradicate poverty.
Later, it was realised that economic growth is a very long term goal. Therefore, according to the second approach, in the short-run, special anti-poverty schemes were implemented by the government, until long term economic growth alleviates poverty significantly.
So far evidence indicates that both approaches towards poverty reduction have had only limited success because of a lot of leakages in the money spent on the projects, a large chunk of benefits being bagged by the middle men. According to 66th round of NSS survey, in 2009-10, 29.6 per cent or in absolute numbers 360 million people were living below the poverty line. Even this estimate was considered to be a gross underestimate of poverty in India.
The key economic reforms in the history of Indian Economy, i.e. Liberalisation, privatisation and globalisation, have no doubt played an important role to help achieve higher economic growth. However, its impact on the poverty has been very little as it has benefited the rich
The amount of people it effects is limited, no longer effecting the majority. Although poverty has minimized it is still significant poverty which is characterized by a numerous amount of things.There are two types of poverty case and insular. “Case poverty is the farm family with the junk-filled yard and the dirty children playing in the bare dirt” (Galbraith 236)Case poverty is not irretraceable and usually caused if someone in the household experiences “ mental deficiency, bad health, inability to adapt to the discipline of industrial life, uncontrollable procreation, alcohol, some educational handicap unrelated to community shortcomings” (Galbraith 236) .Case poverty is often blamed on the people for their short comings but on some levels can be fixed with the help of charities .Insular poverty is where everyone in that area is poor in this situation you are incapable of pinpoint one person shortcomings that caused this poverty. Most modern poverty is insular and is caused by things people in this community cannot control. “The most important characteristic of insular poverty is forces, common to all members of the community that restrain or prevent participation in economic life are going rates of return. These restrains are several .Race, which acts to locate people by their color rather than by the proximity to employment, is
All the approach strategies are useful. The most effective in fighting poverty would be the curative approach to poverty. This approach aims to end the chronic and persistent poverty by helping the poor to become more self-supporting through changes in their lives and their environment. It will break the cycle of poverty; the curative approach strives to initiate the poor into employment and later the middle class. The alternative strategies that has been developed that would be more effective in combating poverty is saving and accumulation of assets. These are important for purchasing a home, sending college, starting a small business, and reaching other economic goals. By having savings and accumulation assets and learning to live within
...he nation’s prosperity as increases in benefits and wages to poor and working class Americans. Most of the gains due to the rise in the GDP in recent years wind up in the hands of the wealthiest of Americans. The increase in income inequality has cause stagnation in real wages among low skilled workers and has led to an increase in poverty. Unable to gain the education necessary to escape the cycle of low skilled jobs with little chance of upward mobility, children of parents who are in poverty stand a higher chance of being in poverty themselves. The solution to the problem of poverty is not simple; especially when it may involve changes in the way the U.S. labor market functions. However, as it stands now, failures of the labor market lead to higher rates of poverty, and unless the problem is addressed, we are unlikely to see a reduction in the U.S. poverty rate.
Everyone knows what the word poverty means. It means poor, unable to buy the necessities to survive in today's world. We do not realize how easy it is for a person to fall into poverty: A lost job, a sudden illness, a death in the family or the endless cycle of being born into poverty and not knowing how to overcome it. There are so many children in poverty and a family's structure can effect the outcome. Most of the people who are at the poverty level need some type of help to overcome the obstacles. There are mane issues that deal with poverty and many things that can be done to stop it.
Most people of the society still blame the poor for their own predicament. They believe that "if there is a will there is a way". However, they do not think about their government that might had made bad decisions and policies that could actually harm successful development. This causes of poverty and inequality are usually less discussed and often neglected. We must recognize the effects poverty could have on the society and seek ways to create better understanding and resolve the issue before it is too late.
Poverty is still the biggest problem the world faces from day to day. Every country suffers from it to some degree, however certain places are greater effected than others. This is because the level of economic growth differs from country to country. The greater amount of growth the less room there is for poverty. This is simple reason why some countries are richer than others. If countries fail to move forward than it can present many problems. Mainly the needless suffering of many, and generally a lower level of living for all those caught in the trap. It is true that growth does create it own problems such as pollution and congestion, but these are acceptable compromises to reduce the level of poverty. The governments around the world have many policies to try and improve the workings of their economies. Governments will differ in the emphasis they give to particular objectives and the ways in which they try to achieve these. The circumstances around these change from time to time, focusing on certain objectives that need the most influence. Economic growth is an ongoing priority. Governments just have to make sure they manage what resources they have properly, in order to achieve this objective.
Economically poverty is the condition of not having enough funds to provide water, shelter, clothing and nutrients for them and the household. Socially, poverty is viewed as a disadvantage in the social belonging, such as capabilities, educational and cultural aspects. Here is an exception from Narayan, D. & P. Petesch. 2002. Voices of the poor: from many lands. Oxford University Press for the World Bank. New York, this is one of the best description out there to describe poverty from one’s point of view. “Throughout the Voices of the Poor series people vividly describe multiple, interlocking sets of disadvantages that leave them powerless to get ahead. Experiences of ill-being including material lack and want (of food, housing and shelter, livelihood, assets and money); hunger, pain and discomfort; exhaustion and poverty of time; exclusion, rejection, isolation and loneliness; bad relations with others, including bad relations within the family; insecurity, vulnerability, worry, fear and low self-confidence; and powerlessness, helplessness, frustration and anger”
Poverty can be described as many things, it can be described as hunger, lack of shelter, not having access to school, not knowing how to read and much more. Despite the definitions, one thing we know for sure is that poverty is a complex societal issue. Poverty is a large cause of social tensions and threatens to separated a nation because of the issue of inequalities, more specifically, income inequality. Poverty is a main impact of globalization, it can affect a whole nation by furthering inequalities. Overall, has affected all of developing countries and has a crucial impact on developed countries.
In order for any country to survive in comparison to another developed country they must be able to grow and sustain a healthy and flourishing economy. This paper is designed to give a detailed insight of economic growth and the sectors that influence economic growth. Economic growth in a country is essential to the reduction of poverty, without such reduction; poverty would continue to increase therefore economic growth is inevitable. Through economic growth, it is also an aid in the reduction of the unemployment rate and it also helps to reduce the budget deficit of the government. Economic growth can also encourage better living standards for all it is citizens because with economic growth there are improvements in the public sectors, educational and healthcare facilities. Through economic growth social spending can also be increased without an increase of taxes.
...Taxing the rich more and the poor less, taxing methods need to be tailored to an individual’s financial bracket to ensure that upward social mobility becomes an absolute possibility. Building self-sufficient economies, projects to launch new industries and businesses will also need encouragement from the people. Education, it provides training to tomorrow’s workforce and helps the economy against the increase of poverty. Involvement of the media, the media has a lot of power when it comes down to grabbing society attention. With the media, people will become conscious of one of the major issues, poverty. Micro financing, offers financial services to individuals in developing nations who wish to run their own businesses. All these ideas should be implemented. It may seem unrealistic to try all 10 of them but giving some solutions a try would help the cycle of poverty
Economic growth is the most effective instrument for reducing poverty and enhancing the quality of life in developing countries. The benefits brought about from economic growth is strong growth and business opportunities enhance incentives. This may lead to the rise of a strong and growing group of entrepreneurs, which should generate pressure for enhanced administration. Strong economic growth therefore advances human development, which in turn promotes economic growth. But, under different conditions, comparative rates of development can have altogether different consequences for neediness, the occupation prospects of poor people and more extensive pointers of human development. The extent to which growth decreases neediness depends on the extent to which the poor take an interest in the growth process and share in its returns (Riley, G.
Poverty is a major problem in the United States today. Social, economical, political, and cultural factors all contribute to poverty. Education and economic development are two major issues that will help prevent poverty. The United States Census Bureau defines poverty as an "economic condition in which people lack sufficient income to obtain basic needs for food, housing, clothing, health services and education." In other words, poverty is powerlessness, a lack of representation and freedom. Poverty is an issue that the world faces everyday.
There are many reasons why poverty is an increasing problem. The first is delayed modernization. These less-developed countries barely have enough skilled workers and managers and technology. Industrialized countries have four times as many managers and workers as the less-developed countries, also known as LDC's. It is almost impossible for the lower-developed countries to catch up or even compete with the industrialized countries....
Poverty an also be described as having a lack of income and/or goods to satisfy necessities-food, shelter, clothing, and acceptable levels of health and education.
But the growth has not been inclusive, broad-based and transformational. The implication of this trend is that economic growth in Nigeria has not resulted in the desired structural changes that would make manufacturing the engine of growth, create employment, promote technological development and induce poverty alleviation. Available data puts the national poverty level at 54.4 per cent. Similarly, there has been rising unemployment, with the current level put at 19.7 per cent by the National Bureau of Statistics (NBS).