Examples Of Global Poverty And Inequality

Global Poverty and Inequality

Poverty

Extreme poverty persists in developing countries. Major explanations for poverty include a low level of production and GDP per capita and high inequality within poor nations (Perkins). Poverty disproportionately affects different regions and demographics within countries. While extreme poverty is shrinking worldwide, it is still prevalent in Africa. Moreover, the global poor tend to be rural, young, and poorly educated (WB REPORT). People in rural areas tend to be poorer because of fewer opportunities for economic advancement. Women tend to be poorer because of a variety of factors: discrimination in the workplace, a tendency to work more at home, and domestic violence (Perkins). Poverty can be measured

However, a pro-poor development strategy is preferable because inclusive growth ensures that the entire society is benefiting from faster growth. Such a strategy encourages more rapid growth and improved opportunities for the poor via investments in education, health care, and safety nets for especially vulnerable groups. Poverty reduction strategies must involve directing health and educational services to the poor in addition to promoting market-oriented economic growth. Improving markets only helps the poor if they can take advantage of economic opportunities. Education permits people to become more productive, and good health prevents people from the economic hit that follows taking time off from work due to poor health. Additionally, social safety nets and income transfers can be utilized to reduce poverty. Social safety nets, unlike income transfers, recognize that household poverty is often transitory rather than chronic (Perkins). Furthermore, most of the global poor live in lower-middle-income countries, not just low-income countries (WB REPORT). Thus, it is essential that interventions do not exclusively impact low-income

Inequality matters because the degree of inequality coupled with national income determines the extent of poverty (Perkins). The 1990s showed the first signs of narrowing inequality since the Industrial Revolution. Despite recent progress in inequality reduction, the average inequality within countries is greater now than it was 25 years ago. Latin America, the Caribbean, and sub-Saharan Africa stand out as regions with exceptionally high inequality. For example, the global poverty gap is about 3%, while the gap in sub-Saharan Africa is around 16% (WB REPORT). Moreover, by 2001, the poverty gap had fallen to single digits in every region but sub-Saharan Africa, where it actually increased (Perkins). Typically, this increase in inequality occurs because the income share of the top income groups expanding rapidly (WB REPORT). Other causes of inequality involve a legacy of racist policies (e.g., apartheid in South Africa) and mineral wealth (Perkins). A significant amount of falling global inequality has resulted from the rapid growth of China and India, two populous countries that achieved remarkable economic growth in recent history (WB