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The Problem of Poverty

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7 views

The Problem of Poverty

Uploaded by

nazzzliba
Copyright
© © All Rights Reserved
Available Formats
Download as PPTX, PDF, TXT or read online on Scribd
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The problem of

poverty
Poverty
A state or condition in which a
person or community lacks the
financial resources and
essentials needed to enjoy the
basic needs of life, such as food,
clothing and shelter.
Absolute poverty
Means that a person’s income is
considered to be insufficient for them
to satisfy basic human needs

The World Bank classes anyone living


on less than $2 a day as living in
absolute poverty
Relative poverty
Is when a person’s income is a certain
level below a society’s average
(median) income

In the UK if a person’s income is a


level below 60% of the current
median income
https://
www.youtube.com/watch?v=z8jp2YPwhRw
The DWP produces figures for
measuring poverty using two
measures:
• Income before housing costs – spending on items such as rent and
mortgages are treated the same as spending on food and leisure.
Increased income means that person is better off, and may choose
to spend this on housing
• Income after housing costs – this eliminates the effect of regional
differences in housing costs – spending more on housing in London
is not a true reflection of a better standard of living. This approach
also overcomes the problem of people receiving housing benefits
because if rents increase, housing benefits do to but this extra
income is not a reflection of a better standard of living.
Whilst it is possible to overcome absolute poverty by
creating a society in which all individuals are provided
with their basic needs, overcoming relative poverty is
not straightforward.

In the UK, measures of poverty are based on household


income. Who, therefore, will be excluded from
government figures? There will be an underestimation
of the true level of poverty.

Why may measures based on household income not


accurately reflect the level of poverty?

What is the difference between mean and median


income? How does this affect assumption about
poverty in the UK?
The causes of poverty
> Low levels of income from employment
What leads to lower levels of income?
Low levels of income from employment – what is the government’s target in relation to the
national living wage? Why should this reduce relative poverty?
> Unemployment –
> Dependency on others and age –
Who are the following dependent on? Unemployed? Pensioners? Children? Housewives?
Why is age a factor contributing to poverty?
> Gov policy – current policy focuses on wealth creation and the trickle-down effect this has on
everybody’s level of income. Consequently, absolute poverty should improve if this strategy is
successful. However, since it depends on wealth creation through the market mechanism, it is
likely to widen income differentials and therefore is less likely to reduce levels of relative
poverty.
> Low levels of education and training
> Country and/or region of residence – examples?
> Family background – what is social mobility? How can this contribute to people experiencing
poverty?
> Health
The effects of poverty
> Ill-health and death - Why are those in poverty more likely
to suffer from ill-health, mental health issues and lower life
expectancy?
> Limited education and training and thus poor job
prospects. Why do many children born into poverty continue
the cycle of poverty?
> Lower productivity for the individual and economy – What
is the correlation between productivity and poverty? What
will be the level of demand for workers with low labour
productivity (in your answer refer to MRP)?
> Lifestyle –
• https://
www.youtube.com/watch?v=HEB4tvIRTXo

• https://
www.tutor2u.net/economics/reference/revisi
on-presentation-wealth-and-income-inequalit
y?p=economics/presentations/a2economics/
micro/PovertyInequalityCauses/default.html

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