G. Social Dimensions Poverty Inequality and Development

SOCIAL DIMENSIONS:
POVERTY, INEQUALITY AND

DEVELOPMENT
DENNIS M. BACUYAG, DPA

Campus Dean, Graduate School
OBJECTIVES
When you have finished studying this Chapter you should be able to:
 To know what is poverty and the perspectives of poverty;

 To track the trends of poverty;
 To identify the causes of poverty;
 To identify the measurements of poverty;
 To define what is inequality;
 To discuss the causes of inequality and sources of income inequality;
To track the existing ways on reducing poverty.
What is Poverty?
Poverty means the inability to
secure the minimum consumption
requirements for life, health and
efficiency, it is clearly unmet human need,
not just a failure to meet minimum
nutrition , but rather a failure to keep up
with the standards prevalent in a given
society.
Who are the poor?
The poor are made up of persons
of all religions, colors, sexes, ages, and
ethnic backgrounds, Many of the poor
are unstrained , stuck in economically
stagnant rural areas who usually can’t
get the basic necessities of life, yet many
also are active job seekers in urban labor
markets.
Trends of Poverty
Poverty in Less- Developed Countries
Poverty less-developed nations is identified incomes and living standards
that borders on subsistence, high mortality rates for children, low school
enrolment rates and poor health.
Poverty in the Philippines
Poverty has remained a visible problem of the
economy, the condition of lacking full economic access to
fundamental human needs. Economic Development has
continued. But the rapid growth of the population in the
midst of this growth has eaten up much of the growth in
the economy.
1. Employment
C Labor is the most important
A asset of the poor. The
U basic problem of the poor is not so
S much on lack of employment as the low
E incomes derived from employment.
S
O
F
P 2. Population
O Philippines is ranked as the twelfth most densely
V populated country in the world comprising of 90 millions (as
E of in 2006). Population growth in and itself is not a problem
R if resources are available to cope with the additional people
T requiring public services, employment, housing and so on.
Y Rapid population growth hinders development.
3. Governance
The governance effectiveness of
governments has a major impact on the delivery
of socioeconomic outcomes for poor
populations, weak governance seems to be the
major contributory factor for the economy’s
lackluster performance and insignificant impacts
on poverty.
4. Conflict
Conflict causes death and
destruction, such as the breakdown of
infrastructure and services. (Physical
Capital)This in turn leads to greater
human suffering; increased poverty and
a need for aid for the people.
NEGATIVE IMPACTS OF CONFLICT ON ALL
FORMS OF CAPITAL
Human capital: Conflict leads to deaths, disablement and
displacement and decline the capacity to provide services.
Financial capital: Financial institutions ,investments,
markets rates of economic growth are negative impacts of
conflict.
Social Capital: decreases social relations and causes
decline in trust .
Natural capital: Conflict leads to lack of management and
investment in natural resources.
5. Disability
Disability can encourage poverty
because…
– People who have disabilities have to

deal with “social stigmas and exclusion.”
A disabled person reduces their

opportunities to contribute productively to the
household and to the community, which in turn
6. Gender reduces the risk poverty.
Severity of income
poverty in the among
female-headed
households in the
Philippines are lower
than among male-
headed households, in
contrast to most
developing countries.
7. Income Inequality
When income distribution is
highly unequal, as in the Philippines,
As a result, poverty measures
become very sensitive to where the
poverty line is placed, and a small
changes in the poverty threshold
can result in large changes in the
population identified as poor.
8. Discrimination in Labor Markets

When minority-group workers with skills,
experience, and training are paid lower
compared to the other working group
discrimination occurs, it will also restrict
minority group members from entering higher
–paying occupations to earn wages.
ASPECTS OF POVERTY
Hunger
Poor health and Illness
Long hours of work
Lack of Access to basic infrastructure
Lack of access to basic education
Unhealthy work environment
Substandard housing
Inadequate income
MEASUREMENTS OF POVERTY
A. Household Per Capita

Income
When one’s income is
below poverty line, the family
is considered poor.
B. The Headcount of the

poor
The actual measure of
who are the poor in the
country.
C. Minimum basic needs D. Self-rated poverty
- Identifies essential measurement
goods that poor people would People know best
need to sustain their growth out the reality of their own
of poverty. economic condition.
Basic needs approach –
an approach that identifies the E. Human Poverty Index
minimum needs that are Believing that
essential to make poor people human poverty should be
achieve a meaningful measured in terms of three
subsistence while providing key deprivation – of life, of
them with a development basic education, and of
strategy to help them grow out overall economic
of poverty. provisioning.
Ways of Reducing Poverty
ADB THREE PILLARS

•Sustainable Economic Growth
Growth reduces poverty by creating employment
and raising incomes.
•Social Development
Second key element necessary to enable everyone
to participate in growth.
•Good Governance
Critical to poverty alleviation because it makes
sound macromaeconomic management.
CURRENT WELFARE
ECONOMIC
SYSTEM
GROWTH The current welfare
Is the most
assistance program follows the
effective weapon in
basic principle that public
reducing poverty.
assistance should be granted
Economic growth means
primarily on the basis of
rising output over time
demonstrated need.
EDUCATION PERSONAL INCOME TAX

Principal ways A means of promoting
to escape poverty, equality. Because the income tax
many have used this is progressive, incomes after tax
route successfully. are distributed more equally
than incomes before tax..
CAUSES OF INEQUALITY
•The Labor Market

It’s the major cause of economic inequality within modern
markets is the determination of wages by the market.
• Innate Ability
Innate abilities relating to labor market are in high in
demand ,hence, play a large role in increasing those who have
them.
•Education
Variation in individuals access to education is one factor in
the creation of inequality.
•Gender, Race and Culture
The existence of various
gender, race and culture within a
society is also a contributor to
economic inequality.
•Diversity of Preferences
When faced with the
choice between working to earn
money or more leisure time.
•Development patterns
Countries with low-level
of development have relatively
equal distribution of wealth.
•Wealth condensation
Is a theoretical process
postulating that those who have
already hold wealth have the
means to invest in new sources
of creating wealth.
• Income Distribution
Income Inequality
exists because people do not
receive the same labor income,
asset income pay the same
taxes.
WHAT ARE THE SOURCES OF INCOME INEQUALITY?
a. Differences in Ability
People were born
with different mental and
physical abilities, because of
this differences individuals
are limited in their choice of
occupation.
c. Discrimination
Discrimination
b. Chances and Luck
according to age, sex, skin,
A second source of income
color, or national origin can
inequality is chance (random
also contribute to income
occurrences) and luck.
inequality.
d. Occupational
Differences
The existence of
compensating wage
differences means that some
inequality is in fact a matter of
cautious choice.
e. Human-Capital
f. Inheritance Investment
The distribution Human- capital theory
of income from wealth suggests that inequality can be
can be inferred from the the consequence of choice, not
distribution of wealth. chance.
i. Education and Other
g. Risk Taking Trainings
Most people who The term refers to the
acquire large sums of money idea that workers can sacrifice
do so by taking risk - by current income in order to
investing their money in some improve their skills so that
uncertain venture. their future incomes will be
higher.
h. Work Experience
It is well-known to
most people and well-
documented by scholarly
research that more
experienced workers earn
higher wages.
What is Development?
Development is the process of
economic and social transformation that
is based on complex cultural and
environmental factors and their
interactions.
“ IF A FREE SOCIETY CANNOT HELP THE MANY POOR, IT CANNOT SAVE THE FEW
WHO ARE RICH.”
-JOHN F. KENNEDY
THANK YOU!!!

G. Social Dimensions Poverty Inequality and Development

Uploaded by

Copyright:

Available Formats

G. Social Dimensions Poverty Inequality and Development

Uploaded by

Document Information

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

G. Social Dimensions Poverty Inequality and Development

Uploaded by

Copyright:

Available Formats

SOCIAL DIMENSIONS:

POVERTY, INEQUALITY AND

DENNIS M. BACUYAG, DPA

 To know what is poverty and the perspectives of poverty;

– People who have disabilities have to

A disabled person reduces their

8. Discrimination in Labor Markets

A. Household Per Capita

B. The Headcount of the

ADB THREE PILLARS

EDUCATION PERSONAL INCOME TAX

•The Labor Market

You might also like