Chapter 17: Problem 9

If poverty is a relative concept, why don't we define it in relative terms?

Short Answer

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Relative poverty refers to a situation where an individual or a family's income falls below a certain percentage of the average income for that country or region. In most cases, it is considered as having an income below 60% of the national median income. It helps to determine the proportion of the population that is experiencing financial difficulty in comparison to others in the same society. 2. What are the advantages of defining poverty in relative terms? Some advantages of defining poverty in relative terms include allowing for comparison between different groups and countries, accounting for societal changes, and addressing economic inequality. 3. What are the disadvantages of defining poverty in relative terms? Disadvantages of defining poverty in relative terms include not providing an absolute measure of poverty, varying living standards, and the potential for misuse of data. 4. Why might it be useful to consider both absolute and relative measures when assessing and addressing poverty? Considering both absolute and relative measures of poverty can provide a more comprehensive and accurate understanding of poverty conditions, taking into account the specific needs and living conditions of various communities, as well as the broader societal context of economic inequality and differing living standards. This can enable better-targeted policies and interventions to effectively alleviate poverty.

Step by step solution

Define poverty

Poverty is a state or condition wherein a person or a community lacks the financial resources and necessities required to maintain a basic minimum standard of living. It can occur due to factors such as unemployment, economic disparities, or government policies.

Define relative poverty

Advantages of defining poverty in relative terms

1. Allows for comparison: Defining poverty in relative terms enables comparing the living standards of different groups of people within a society, or even comparing poverty rates between different countries. 2. Accounts for societal changes: Relative poverty measures change as the society's standard of living changes. Therefore, a definition of poverty in relative terms better represents the people who are unable to keep up with the general living standards of a society. 3. Addresses inequality: Defining poverty in relative terms helps to directly address economic inequality, which is often the root cause of poverty in developed countries.

Disadvantages of defining poverty in relative terms

1. Not an absolute measure: Relative poverty doesn't give an absolute measure of the severity of poverty, as an individual living just below the relative poverty threshold might not always be in extreme hardship. 2. Varying living standards: Relative poverty considers the national average standard of living, which may not accurately reflect the actual living conditions of citizens in different geographical areas or communities within the same country, as the cost of living and available resources may vary. 3. Potential misuse of data: Since relative poverty is subject to change with the improvement or deterioration of economic conditions, it may be misused by politicians or policymakers to present a misleading picture of successful poverty reduction efforts. In conclusion, defining poverty in relative terms has its benefits in assessing poverty levels and inequality within a society, but it also has its limitations when it comes to accurately reflecting everyone's living conditions. Therefore, it might be useful to consider a combination of both absolute and relative measures when assessing and addressing poverty.

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Key Concepts

These are the key concepts you need to understand to accurately answer the question.

Relative Poverty

When discussing poverty, it's essential to understand it's not a one-size-fits-all concept. Relative poverty stands out as a dynamic measure. It is not about surviving on the bare minimum, but rather living with considerably less than the societal average. Imagine a seesaw where one end represents those with income well above the median, while the other end dips with those earning significantly less. Thus, even if one's basic needs are met, being in relative poverty means they are excluded from ordinary living patterns, activities, and opportunities.

For instance, if the average income in a country allows for occasional vacations, eating out, and a decently furnished home, those in relative poverty might be able to afford only a fraction of these. By defining poverty this way, it shines a spotlight on economic disparities and helps pave the way for policies tailored to reduce such gaps, ensuring everyone has access to a life that's not just survivable, but also enjoyable and participative in society.

Economic Inequality

Delving deeper into financial disparities, we arrive at the concept of economic inequality. It's the unequal distribution of wealth and income within a society, where some individuals amass fortunes while others struggle to pay bills. This disparity portrays a society's health and prompts questions about fairness and opportunity.

Economic inequality is multifaceted, stemming from various sources such as education levels, access to resources, economic policies, or historical circumstances. Consider a race where some start miles ahead, thanks to inherited wealth or privileges, while others are held back by systemic barriers. This inequality often translates into life chances, health disparities, and variations in living conditions across the socioeconomic spectrum.

Standard of Living

The tapestry of one's life quality is woven with various threads, which together form the standard of living. This refers to the material and non-material goods and services readily available to people, shaping their daily lives and comfort levels. It includes tangible aspects like income, employment, and housing, as well as intangibles like education quality, leisure time, and environmental conditions.

The standard of living is influenced by economic performance, social policies, and personal choices. It's what makes a community vibrant and satisfying, where parks, libraries, and efficient public transport contribute to the overall fabric of everyday life. In essence, it's not just about survival; it's about thriving and accessing the full spectrum of what life has to offer. Understanding these three concepts is crucial in grappling with global challenges and framing policies that advance collective well-being.