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Poverty and Inequality

The document discusses poverty, inequality, and economic measures between global north and south nations. It defines poverty and introduces Hans Rosling, who discusses how companies produce goods in low wage countries. It then explains the multiplier effect in economics. The main topics of wealth inequality and income inequality are defined. Key economic measures like GDP, GNP, and GNI are introduced and explained in regards to measuring global economic equality and the differences between global north and south nations.

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72 views15 pages

Poverty and Inequality

The document discusses poverty, inequality, and economic measures between global north and south nations. It defines poverty and introduces Hans Rosling, who discusses how companies produce goods in low wage countries. It then explains the multiplier effect in economics. The main topics of wealth inequality and income inequality are defined. Key economic measures like GDP, GNP, and GNI are introduced and explained in regards to measuring global economic equality and the differences between global north and south nations.

Uploaded by

patty kiddo
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© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PPTX, PDF, TXT or read online on Scribd
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POVERTY AND

INEQUALITY

GE 103 THE CONTEMPORARY WORLD


Poverty
• Poverty is not having enough material
possessions or income for a person's needs.
Poverty may include social, economic,
and political elements.
Hans Rosling(Swedish
statistician )
• Most shoe companies
choose to produce their
labor-intensive products in
countries with weak
regulations and low wages
MULTIPLIER EFFECT
• If there is an increase in one economic activity
can lead to an increase in other economic
activities.
• Example:Investment in local businesses will lead
to more jobs more income
GLOBAL INCOME INEQUALITY
• 2 MAIN TYPES OF ECONOMIC EQUALITY
“Wealth inequality and Income inequality”
“Wealth refers to the net worth of a country ”
Taking to account all the assets of nation-natural,
physical and human
GLOBAL NORTH AND SOUT

GLOBAL NORTH
CORE NATIONS

GLOBAL SOUTH
PERIPHERAL NATIONS
Wealth Inequality
• It is the abundance of resources in a specific
country
• It speaks about the distribution of assets
Income inequality
• Earnings that are constantly added to the
country’s wealth
• New earnings are being distributed:it values the
flow of goods and services
• In order to measure global economic
equality,economist usually look at income using:
• Gross Domestic Product GDP
• Gross National Product GNP
• Gross National Income GNI
GDP GROSS DOMESTIC PRODUCT

GDP is a measure of (national income = national


output = national expenditure) produced in a
particular country.
Example:
If a Japanese multinational produces cars in the UK,
this production will be counted towards UK GDP.
GROSS NATIONAL INCOME
• GNP = GDP + net property income from abroad. This
net income from abroad includes dividends, interest
and profit
• if the Japanese firm sends £50m in profits back to
shareholders in Japan, then this outflow of profit is
subtracted from GNP. UK nationals don’t benefit
from this profit which is sent back to Japan.
• If a UK firm makes a profit from insurance
companies located abroad, then if this profit is
returned to UK nationals, then this net income from
overseas assets will be added to UK GNP.
GROSS NATIONAL INCOME GNI
• GNI (Gross National Income) is based on a similar
principle to GNP. The World Bank defines GNI as
• “GNI is the sum of value added by all resident
producers plus any product taxes (minus subsidies)
not included in the valuation of output plus net
receipts of primary income (compensation of
employees and property income) from
abroad.” (World Bank)
• The World Bank now use GNI rather than GNP.
GLOBAL NORTH
• Global North include the G8 countries,
the United States, Canada, all member states of
the European
Union, Israel, Japan, Singapore, South Korea, as
well as Australia and New Zealand
• Russia, UK, France
GLOBAL SOUTH
• It refer to countries located in Asia, Africa, Latin
America and the Caribbean and considered to have
low and middle income compared to the Global
North.[2]
• These nations are often described as
newly industrialized or in the process of
industrializing, are largely considered by freedom
indices to have lower-quality democracies, and
frequently have a history of colonialism by Northern,
often European states

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