...In order to understand poverty one must be able to identify exactly what it is, in the oxford dictionary the definition of poverty is ‘the condition of being extremely poor’. But then one must question what is defined as poor? I will be looking at two approaches of this question, the first is the ‘monetary approach’ and the second is the ‘capabilities approach’. I will also be analysing two different measures of poverty, ‘absolute’ and ‘relative’ and to conclude which is a more accurate or a more suitable instrument in poverty measure. The monetary approach is probably the most common method of understanding poverty. It is highly used by economists and is significantly connected with microeconomic theory. Utility maximisation is the base for this approach and the main instrument used is a poverty line; this sets a threshold where if income or consumption is below, people are then classified as poor. An example of this would be the ‘dollar a day’ where any income below $1 a day is classified as poor. This approach suggests that income or consumption is equivalent to well-being. In developing countries measuring welfare with consumption would be more appropriate than using income, as income is a small component and would be an overestimate. There is plenty of data which can be analysed at household levels. However, poverty is an individual phenomenon where individuals are situated within households. After assuming some measurements between income and consumption, data at the household...
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...capabilities approaches to poverty with monetary approaches. What are the strengths and weaknesses of each? In your view, which is better for understanding poverty? Explain your answer. “What a weary time those years were- to have the desire and the need to live but not the ability” (Bukowski, 1982). Poverty affects billions of people worldwide, particularly in sub-Saharan Africa and East Asia. Defining poverty is almost as difficult as eradicating it. For the purpose of this essay, I will take poverty to mean the state of being exceptionally poor. Furthermore, poorness will be defined as an extremely low quality of life, which culminates as a result of social, political and economic factors. In order to examine the strengths and weaknesses of each approach, it is necessary to identify who these are strengths and weaknesses for; a strength of an approach may be considered a weakness from a different perspective. Governments and international organisations, with a common goal of lifting poverty from disadvantaged countries, are the main focus of this essay. Leading policy makers around the world have adopted a “uni-dimensional perspective on poverty” (Wong, 2012) which largely focuses on a lack of income. This definition provides the basis for the Monetary Approach to poverty. However, this is an exceptionally constricted view of poverty, disregarding many social and political factors that contribute to the current, bleak situation. The Capabilities Approach to poverty provides a far better...
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...Poverty Line In today’s society, most people understand that poverty exists. It is a major issue in the United States. How does one determine how who really lives in poverty? Some people consider poverty living from pay check to pay check while some only consider the most extreme cases poverty, for example the homeless living on the streets. However, there is a way that poverty is measured in the United States. This measurement tool is called the poverty line also known as the poverty threshold. According to, “The U.S. Poverty Line: A Time For Change” written by Donald E. Chamber “poverty threshold is a measure of the amount of money society believes is necessary for a person to live at minimum level of subsistence or at a level consistent...
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...Capabilities: Income and Poverty In Creating Capabilities Martha C. Nussabaum suggests that measuring poverty using one’s income can be misleading and problematic when it comes to understanding the real reason why the person is poor. Nussabaum argues that poverty “involves heterogeneous failures of opportunity, which are not always well correlated with income” (Nussabaum 143). The problem with measuring poverty through the means of just income is outdated, there are many devastating factors that can greatly altar one’s living condition besides their income. As Nussabaum suggests, income is an inaccurate means in determining one’s well-being because other factors such as education, nutrition and debt could contribute to greatly altering one’s earnings, then causes them to go into poverty. This essay is to explain why measuring poverty through income is a problem. Nussabaum’s belief of why the measurement of poverty is determined by income is flawed and how it should not be used because, there are other factors that can greatly altar ones living conditions will be defined as: “Poverty involves heterogeneous failures of opportunity, which are not always well correlated with income; moreover, people in positions of social exclusion may have difficulty converting income into actual functioning, so income is not even a good proxy for capabilities”(Nussabaum 143-4). The research in this essay includes the article What’s the Best Way to Measure Poverty? by Matthew Philips (freakonomics...
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...Running Head: Poverty Examination of a Concept: Poverty Shelton Land Virginia Commonwealth University Poverty 2 EXAMINATION OF A CONCEPT: POVERTY Introduction Poverty has existed persistently since it was uncovered. The results of a family or individual living in poverty range from infectious diseases to drug abuse. “As the economy has shifted from the industrial sector to services and computer based technology, the impact has hit hardest for working class and poor families, with limited education, job skills and employment opportunities” (Walsh, 2003, pp.17). Despite the effects of poverty, different individuals have different perceptions about the persisting problem. Some assert that poverty is a natural condition of man; while others view it as self-imposed, imposed, or a debilitating economic situation. This paper will examine the many concepts of poverty and discuss how it is related to at least two theoretical perspectives on human behavior, how it has changed over time, current issues related to poverty and how these issues are similar and different for two countries. Definition Many scholars and researchers define poverty as an insufficiency of the material necessities of life. The disparities between the rich and poor have increased so solemnly since the industrial revolution that it formed a poverty line. A poverty line which is used in defining what percentage of the population is poor based on the economy. Poverty 3 The US Census Bureau (2009) cites...
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...What is poverty? A question most Americans will not have to think twice before answering. Poverty is, of course, simply a lack of money. The views of a specific person will differ when politics or morals are introduced, however, the idea stays the same. Those in poverty are there because they have less money than what has been decided to be livable. Poverty has changed significantly over the last two hundred years in the United States, and yet, the measurement has hardly changed since it was created fifty years ago. As the United States of America has become a better-established country and therefore a more prosperous country, the type of people that are considered poor has changed quite a bit. Before industrialization and immigration became...
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...Who are the poor? The answer is what poverty is. WHAT IS POVERTY? In the most extreme definition, poverty manifests itself in the form of outright starvation and destitution because individuals or households do not possess the resources which give access to the basics for survival or which enable them to enjoy some minimum standard of living. (Christine Barrow; 2001) From a theoretical Perspective of Poverty. Culture of Poverty The underlying idea is that the lifestyle of the poor differs in many respects to that of the non poor in society. Similarities have been found in this poverty lifestyle even across different societies. This leads to the development of a sub culture, with its own norms and values, which can now be transmitted from one generation to the next. Technically, the culture of poverty is a subculture of poor people in ghettos, poor regions or social contexts where they develop a shared set of beliefs, values and norms for behaviour that are separate from but embedded in the culture of the main society. Once the culture of poverty has come into existence it tends to perpetuate itself. By the time slum children are six or seven they usually absorbed the basic attitudes and values of their subculture. Thereafter they are psychologically unready to take full advantage of changing conditions or improving opportunities that may develop in their lifetime. Oscar Lewis. Marxist Perspectives Conflict theorists posit that poverty results from the failure of the state...
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...Wall Street Journal Slow Economic Growth affects the efforts to fight poverty Dear Sir, As a business student, the article by McKay (2016), Slow Growth Clouds Fight Against Poverty caught my full attention. This is because I found the article to be very informative and it enlightened me so much. I therefore write you to concur with the comments of the writer. I want to point out some of the points that I found very informative in the article. It is true that slow growth of the economy affects the fight against poverty and that the impact that the growth of the economy has on poverty has been documented. Kasen (2008) argues that the factors that really impact the efforts of poverty eradication lie in the economic inequalities that are present in the economy. This is because one cannot measure the poverty that is present in the developed economies in the same manner as measuring the poverty level that is present in the developing economies. The main reason as to why one cannot use the same measurement indicators in the two economies is because the definition about poverty varies in the two economies. When there is a slow growth in the economy, the numbers of people that will benefit from it are just a few individuals who are able to meet their needs despite the performance of the economy. The people who are really affected by the slow growth of the economy are the poor people. Efforts to eradicate poverty in a slow economy are hindered because the state needs to allocate resources...
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...obstacles might be in the form of ill health, illiteracy, lack of resources or lack of freedom- both political and civil. When these obstacles are removed one is said to be capable; hence the origin of the concept of capability Sen, 160). Purpose Statement The purpose of this paper is to analyze the concept of capabilities approach that was developed by Amartya Sen, a Nobel Prize winner, and M. Nussban. Amartya has enabled the measurement of human development by the United Development Program (UNDP). He helped invent the capabilities approach, which is the foundation of indices used by UNDP in their measurements. Through these indices the achievement in education and health can be measured in addition to income (Nussbaum, 67). Objectives The main aim of this paper is to establish whether the Human Development Reports (HDRs) have their base relying on the concept of capabilities approach and establish why they are based on the approach. Furthermore, it will endeavor in contrasting the other ways such as the Human Development Index (HDI) and the Human poverty index (HPI) which can be used as a measure of human economic development....
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...IMPLEMENTATION IN THE PHILIPPINES CONTEXT This paper studies the application of Balanced Scorecard (BSC) as a powerful measurement and assessment system, in lending/micro financing institutions. Adopting the balanced scorecard (BSC) model, this exploratory study investigates the critical performance measures that lending/micro-financing institutions in the Philippines need to emphasize in their performance reporting to drive high performance. The proposed model can assist the lending institutions in assessing organizational performance, making it highly applicable for managers. Reviewing the existing literature, the paper also provides an implementation guide for BSC in the Philippines perspective. Eventually, the performance indicators for measurement purposes of the introduced case study are proposed. Keywords: Lending/ Micro financing Institutions, MFIs, Financial Services, Balanced Scorecard, BSC, Organizational Performance Assessment, performance reporting, Philippines. 1. Introduction In many developing countries, microfinance plays a vital role in providing the poor (i.e. micro-entrepreneurs, small farmers, fishermen) with access to credit and helping them improve their lives by encouraging entrepreneurial activity (Arch, 2005; Bhatt & Tang, 2011; Khandker, 1996; Llanto, 2004). It has also proven to be “a potent tool for poverty reduction by helping the poor increase their income, smooth consumption, build assets, and reduce their vulnerabilities in...
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...Personal development and Academic Skills | Poverty and Crime | Does poverty foster crime? | | SHI Hanwei | 28 September 2012 | Introduction: There has been an ongoing discussion over the relationship between poverty and crime. Some of the researches have concluded that poverty does not increase the crime rate, because in some of the most undeveloped countries where people have low standard of living and some even struggle to survive, the crime rate was proven to be low (Christine 2005). However, in contrast, some scholars have developed a direct relationship between poverty and crime. The researchers indicated that since people who live in poverty are already having a bad life and the benefit of committing a crime is greater than the cost of committing it and ultimately, people who live in poverty is more likely to commit a crime (Niskanen 1996). This essay will examine both perspectives over the relationship between poverty and crime and subjectively suggest possible causes of crime rate. However, since only secondary data are gathered, there might not be sufficient information to present the real issue. Contents of Discussion: In order to prove the direct relationship between poverty and crime, it is crucial to understand the direct influences of poverty and then the potential threats it might oppose to the society. Poverty is defined as the state of having little or no money, goods, or means of support; condition of poor (Dictionary.com 2012). The money is...
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...and what’s different in poverty reduction?” would have brought a set of answers different from those that one would give today. Despite the Asian financial and economic crisis, positive new developments within the last two years suggest promising possibilities for poverty reduction and poverty elimination. Poverty Reduction before the Asian Financial and Economic Crisis Three new elements stand out in the approach to poverty reduction in the 1990s. First, there was a new optimism in the mid-1990s over the prospects for rapid reduction of poverty in developing countries. The Human Development Report (HDR) for 1997, which focused on poverty, amply demonstrates this. It showed that the incidence of poverty had fallen more in the last 50 years than in the previous 500 years. Indicators of human development highlighted significant advances in most countries of the world, including countries that had experienced long periods of economic difficulty. The People’s Republic of China (PRC) and some 14 other countries, with a population totaling 1.5 billion people, had shown astonishing drops in poverty in less than 20 years. Ten more countries with almost another billion people reduced the proportion of their populations below the poverty line by a quarter or more. All this set the stage for optimism regarding prospects in the rest of the world, with many Asian countries leading the way. Second, there was a new commitment to reducing and eventually eliminating poverty. At the World Summit for...
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...Pag-aaral Pangkaunlaran ng Pilipinas Toward Measuring Household Vulnerability to Income Poverty in the Philippines Jose Ramon G. Albert, Lilia V Elloso . and Andrei Philippe Ramos DISCUSSION PAPER SERIES NO. 2007-16 The PIDS Discussion Paper Series constitutes studies that are preliminary and subject to further revisions. They are being circulated in a limited number of copies only for purposes of soliciting comments and suggestions for further refinements. The studies under the Series are unedited and unreviewed. The views and opinions expressed are those of the author(s) and do not necessarily reflect those of the Institute. Not for quotation without permission from the author(s) and the Institute. December 2007 For comments, suggestions or further inquiries please contact: The Research Information Staff, Philippine Institute for Development Studies 5th Floor, NEDA sa Makati Building, 106 Amorsolo Street, Legaspi Village, Makati City, Philippines Tel Nos: (63-2) 8942584 and 8935705; Fax No: (63-2) 8939589; E-mail: publications@pids.gov.ph Or visit our website at http://www.pids.gov.ph Toward Measuring Household Vulnerability to Income Poverty in the Philippines♦ Jose Ramon G. Albert,µ Lilia V. Elloso* and Andrei Philippe Ramos∂ Abstract: Concomitant to the analysis of poverty is the measurement of vulnerability. Estimates of household vulnerability to income poverty are developed using a modified probit model that considers volatilities in income as being...
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...| Crime in the United States | Data Analysis Project | | Brad Davidson | | 12/2/2010 | | Executive Summary This purpose of this report is to answer the question, “what variables affect the level of crime in the United States?” With so many possible influences, the goal of this analysis will be to narrow the scope to the items which we feel will be most statistically significant when gauging the effect on the level of crime. The regression analysis methodology is best suited for this analysis since it can identify the influences of the different variables from past data and provide an equation to predict future values with an associated level of accuracy. The result of the analysis could then be shared with local and national representatives to help focus efforts on reducing the overall crime level and improve public safety. This report contains the following: (1) Brief introduction of the study, (2) Statistical Methodology, (3) Preliminary Analysis of the Data, (4) Regression Analysis, (5) Forecast, and (6) Conclusion. Introduction The current social climate in the United States was the motivation behind this analysis. With the current mid-term elections, there were many topics that would seem unsettling to most individuals and it’s our perception that most feel more unsafe now than say 10-15 years ago. Granted there are many factors that contribute to this type of fear or uneasiness, but one that we decided to investigate was related to crime...
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...finish off his Ph.D. From there forward he maintain being a professor for various university such as: Jadavapur University, Kolkata, Cambridge University, University of Delhi, London School of Economics, Oxford University and Harvard University. As a professor, Amartya K. Sen raised various questions about welfare theories and how market prices can be taken as reflections of welfare indicators. He chose a path different from your typical economist. His research consist of gathering information on the values of individuals in a society in which he reference different alternative to different values for society as a whole. Amartya K. Sen made use of available statistics for a number of economic and social appraisals: measurement of economic equality, judgment of poverty, evaluation of projects, analysis of unemployment, investigation of the...
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