Absolute And Relative Poverty Essay Poor

Absolute poverty refers to a set standard which is the same in all countries  and which does not change over time.  An income-related example would be  living on less than $X per day.

Relative poverty refers to a standard which is  defined in terms of the society in which an individual lives and which therefore  differs between countries and over time.  An income-related example would  be living on less than X% of average UK income.

Absolute poverty and relative  poverty are both valid concepts.  The concept of absolute poverty is that  there are minimum standards below which no one anywhere in the world should  ever fall.  The concept of relative poverty is that, in a rich country such as  the UK, there are higher minimum standards below which no one should fall, and  that these standards should rise if and as the country becomes richer.

Absolute poverty

Clearly, where both absolute and relative poverty are prevalent, it is  absolute poverty which is (by far) the more serious issue.  This is the  case in much of the third world, where the focus is therefore on fixed income  thresholds (typically $1 or $2 a day, on the grounds that this is the minimum  needed for mere survival).  But in a UK setting, such thresholds have no import:  no one in the UK lives on incomes anywhere near this low.

So, logically,  either one concludes that there is no absolute poverty in the UK or that a much  higher threshold of absolute poverty than $1 or $2 per day should be used.

The view that there is no absolute poverty in the UK is a perfectly valid  position to take.

The view that there should be an absolute poverty threshold but that it  should be much higher than $1 or $2 per day begs the question about how such a  threshold should be defined and on what basis.

  • In the UK, the main efforts to define such thresholds have been undertaken under the general heading of ‘minimum income standards’, which basically estimate the level of income required to purchase a given basket of goods and services.  But the key point about such initiatives is that the basket of goods and services is defined according to the norms of the day and, as such, are inherently relative rather than absolute in nature.  So, for example, there would be many items in the ‘today’s basket’ that would not have been in the basket 50 years ago.  In other words, ‘minimum income standards’ relate to relative poverty rather than to absolute poverty.
  • In recent years, the Government has begun to describe households with less than half  1 the average 1997 household income (after adjusting for inflation) as being in ‘absolute poverty’.  This is, however, purely a political device – the only relevance of 1997 is that it is when the current Government came into power.   2  That is not to say that the statistic is unimportant, simply that it should not be described as ‘absolute poverty’.

To summarise: there is no obvious way of defining an absolute poverty threshold except the $1 or $2 a day thresholds defined on the grounds that this is the minimum needed for mere survival.  But in a UK setting, such thresholds have no import: no one in the UK lives on incomes anywhere near this low.

Relative poverty

The view that relative poverty is not important is a perfectly valid position  to take – it is just not the view that the authors of this website, along with  most other researchers, the EU, the UK government, and politicians of all hues  across the political spectrum take.  So, for example, the government’s  target of halving child poverty by 2010 is defined in terms of relative poverty.

The reason that we believe that relative poverty is important is because we  believe that no one should live with “resources that are so seriously below  those commanded by the average individual or family that they are, in effect,  excluded from ordinary living patterns, customs and activities.”  3  In other words, we believe that, in a rich country such as  the UK, there should be certain minimum standards below which no one should  fall.  4  And, as society becomes  richer, so norms change and the levels of income and resources that are  considered to be adequate rises.  Unless the poorest can keep up with  growth in average incomes, they will progressively become more excluded from the  opportunities that the rest of society enjoys.  If substantial numbers of people  do fall below such minimum standards then, not only are they excluded from  ordinary living patterns, but it demeans the rest of us and reduces overall  social cohesion in our society.  It is also needless.

If one accepts that relative poverty is important in principle, then the  obvious issue arises of what thresholds to use and on what basis.  This is  discussed in detail on the page on  choices of low-income threshold.  Our basic answer is that it does not  matter, so long as the thresholds are defined in relation to contemporary  average (median) income and are for households rather than individuals.  It  is for this reason that the main indicators on this website use a variety of  thresholds, so that a fuller picture of trends can be developed.  But, for  reasons of consistency and clarity, there has to be a ‘headline’ threshold and,  for this, we use the same threshold as both the UK government and the EU, namely  a household income of less than 60% of contemporary median household income.

Some people criticise the concept of relative poverty on the grounds that it  is to do with ‘inequality’ rather than ‘poverty’.  At one level, this is  simply an issue of semantics – because of the potential confusion between  ‘absolute poverty in the third world’ and ‘relative poverty in the UK’, we are  also not very comfortable with the phrase ‘relative poverty’ and this is why we  use the more descriptive ‘in low-income households’ throughout this website.

But at another level, the criticism is simply confused: whilst ‘inequality’  is about differences in income across the whole of the income distribution,  ‘relative poverty’ is about the number of people who have incomes a long way  below those of people in the middle of the income distribution.  These two  things are very different.  For example, whilst there will inevitably  always be inequality, there is no logical or arithmetic reason why there should  always be people in relative poverty.

To summarise: whether one believes that relative poverty is important or not  is a matter of opinion, but all political parties in the UK believe that it is  important and so do we.  There are well-established ways of measuring the  extent of relative poverty and it is these methods to which this website  adheres.

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"Poor" redirects here. For other uses, see Poor (disambiguation) and Poverty (disambiguation).

Poverty is the scarcity or the lack of a certain (variant) amount of material possessions or money. Poverty is a multifaceted concept, which may include social, economic, and political elements. Absolute poverty, extreme poverty, or destitution refers to the complete lack of the means necessary to meet basic personal needs such as food, clothing and shelter.[1]

The threshold at which absolute poverty is defined is considered to be about the same, independent of the person's permanent location or era. On the other hand, relative poverty occurs when a person who lives in a given country does not enjoy a certain minimum level of "living standards" as compared to the rest of the population of that country. Therefore, the threshold at which relative poverty is defined varies from country to another, or from one society to another.[2]

Providing basic needs can be restricted by constraints on government's ability to deliver services, such as corruption, tax avoidance, debt and loan conditionalities and by the brain drain of health care and educational professionals. Strategies of increasing income to make basic needs more affordable typically include welfare, economic freedoms and providing financial services.[3]

Poverty reduction is still a major issue (or a target) for many international organizations such as the United Nations and the World Bank.

Global prevalence[edit]

The World Bank forecasts that 702.1 million people, down from 1.75 billion in 1990 are living in extreme poverty.[4][clarify] Of these, about 347.1 million people lived in Sub-Saharan Africa (35.2% of the population) and 231.3 million lived in South Asia (13.5% of the population). According to the World Bank, between 1990 and 2015, the percentage of the world's population living in extreme poverty fell from 37.1% to 9.6%, falling below 10% for the first time.[5] Nevertheless, given the current economic model, built on GDP, it would take 100 years to bring the world's poorest up to the previous poverty line of $1.25 a day.[6] Extreme poverty is a global challenge; it is observed in all parts of the world, including developed economies.[7][8]UNICEF estimates half the world's children (or 1.1 billion) live in poverty.[9] It has been argued by some academics that the neoliberal policies promoted by global financial institutions such as the IMF and the World Bank are actually exacerbating both inequality and poverty.[10]

Another estimate places the true scale of poverty much higher than the World Bank, with an estimated 4.3 billion people (59 percent of the world's population) living with less than $5 a day and unable to meet basic needs adequately.[11]

In 2012 it is estimated that, given a poverty line of $1.25 a day 1.2 billion people lived in poverty.[12]

Etymology[edit]

Poverty is the scarcity or the lack of a certain (variant) amount of material possessions or money.[13]

The word poverty comes from old French poverté (Modern French: pauvreté), from Latin paupertās from pauper (poor).[14]

The English word "poverty" via Anglo-Norman povert.[citation needed] There are several definitions of poverty depending on the context of the situation it is placed in, and the views of the person giving the definition.

Measuring poverty[edit]

See also: List of countries by percentage of population living in poverty and Poverty threshold

Definitions[edit]

Income Poverty: a family's income fails to meet a federally established threshold that differs across countries.[15]

United Nations: Fundamentally, poverty is the inability of having choices and opportunities, a violation of human dignity. It means lack of basic capacity to participate effectively in society. It means not having enough to feed and clothe a family, not having a school or clinic to go to, not having the land on which to grow one's food or a job to earn one's living, not having access to credit. It means insecurity, powerlessness and exclusion of individuals, households and communities. It means susceptibility to violence, and it often implies living in marginal or fragile environments, without access to clean water or sanitation.[16]

World Bank: Poverty is pronounced deprivation in well-being, and comprises many dimensions. It includes low incomes and the inability to acquire the basic goods and services necessary for survival with dignity. Poverty also encompasses low levels of health and education, poor access to clean water and sanitation, inadequate physical security, lack of voice, and insufficient capacity and opportunity to better one's life.[17]

Poverty is usually measured as either absolute or relative (the latter being actually an index of income inequality).

In the United Kingdom, the second Cameron ministry came under attack for their redefinition of poverty; poverty is no longer classified by a family's income, but as to whether a family is in work or not.[18] Considering that two-thirds of people who found work were accepting wages that are below the living wage (according to the Joseph Rowntree Foundation[19]) this has been criticised by anti-poverty campaigners as an unrealistic view of poverty in the United Kingdom.[18]

Absolute poverty[edit]

See also: Extreme poverty

Absolute poverty refers to a set standard which is consistent over time and between countries. First introduced in 1990, the dollar a day poverty line measured absolute poverty by the standards of the world's poorest countries. The World Bank defined the new international poverty line as $1.25 a day in 2008 for 2005 (equivalent to $1.00 a day in 1996 US prices).[20][21] In October 2015, they reset it to $1.90 a day.[22]

Absolute poverty, extreme poverty, or abject poverty is "a condition characterized by severe deprivation of basic human needs, including food, safe drinking water, sanitation facilities, health, shelter, education and information. It depends not only on income but also on access to services."[23] The term 'absolute poverty', when used in this fashion, is usually synonymous with 'extreme poverty': Robert McNamara, the former president of the World Bank, described absolute or extreme poverty as, "a condition so limited by malnutrition, illiteracy, disease, squalid surroundings, high infant mortality, and low life expectancy as to be beneath any reasonable definition of human decency."[24][notes 1][25] Australia is one of the world's wealthier nations. In his article published in Australian Policy Online, Robert Tanton notes that, "While this amount is appropriate for third world countries, in Australia, the amount required to meet these basic needs will naturally be much higher because prices of these basic necessities are higher."

However, as the amount of wealth required for survival is not the same in all places and time periods, particularly in highly developed countries where few people would fall below the World Bank Group's poverty lines, countries often develop their own national poverty lines.

An absolute poverty line was calculated in Australia for the Henderson poverty inquiry in 1973. It was $62.70 a week, which was the disposable income required to support the basic needs of a family of two adults and two dependent children at the time. This poverty line has been updated regularly by the Melbourne Institute according to increases in average incomes; for a single employed person it was $391.85 per week (including housing costs) in March 2009.[26] In Australia the OECD poverty would equate to a "disposable income of less than $358 per week for a single adult (higher for larger households to take account of their greater costs).[27] in 2015 Australia implemented the Individual Deprivation Measure which address gender disparities in poverty.[28]

See also: Purchasing power

For a few years starting 1990, the World Bank anchored absolute poverty line as $1 per day. This was revised in 1993, and through 2005, absolute poverty was $1.08 a day for all countries on a purchasing power parity basis, after adjusting for inflation to the 1993 U.S. dollar. In 2005, after extensive studies of cost of living across the world, The World Bank raised the measure for global poverty line to reflect the observed higher cost of living.[29] In 2015, the World Bank defines extreme poverty as living on less than US$1.90 (PPP) per day, and moderate poverty[citation needed] as less than $2 or $5 a day (but note that a person or family with access to subsistence resources, e.g., subsistence farmers, may have a low cash income without a correspondingly low standard of living – they are not living "on" their cash income but using it as a top up). It estimated that "in 2001, 1.1 billion people had consumption levels below $1 a day and 2.7 billion lived on less than $2 a day."[30] A 'dollar a day', in nations that do not use the U.S. dollar as currency, does not translate to living a day on the equivalent amount of local currency as determined by the exchange rate.[31] Rather, it is determined by the purchasing power parity rate, which would look at how much local currency is needed to buy the same things that a dollar could buy in the United States.[31] Usually, this would translate to less local currency than the exchange rate in poorer countries as the United States is a relatively more expensive country.[31]

The poverty line threshold of $1.90 per day, as set by the World Bank, is controversial. Each nation has its own threshold for absolute poverty line; in the United States, for example, the absolute poverty line was US$15.15 per day in 2010 (US$22,000 per year for a family of four),[32] while in India it was US$1.0 per day[33] and in China the absolute poverty line was US$0.55 per day, each on PPP basis in 2010.[34] These different poverty lines make data comparison between each nation's official reports qualitatively difficult. Some scholars argue that the World Bank method sets the bar too high, others argue it is low. Still others suggest that poverty line misleads as it measures everyone below the poverty line the same, when in reality someone living on $1.20 per day is in a different state of poverty than someone living on $0.20 per day. In other words, the depth and intensity of poverty varies across the world and in any regional populations, and $1.25 per day poverty line and head counts are inadequate measures.[33][35][36]

The share of the world's population living in absolute poverty fell from 43% in 1981 to 14% in 2011.[30] The absolute number of people in poverty fell from 1.95 billion in 1981 to 1.01 billion in 2011.[37] The economist Max Roser estimates that the number of people in poverty is therefore roughly the same as 200 years ago.[37] This is the case since the world population was just little more than 1 billion in 1820 and the majority (84% to 94%[38]) of the world population was living poverty. The proportion of the developing world's population living in extreme economic poverty fell from 28 percent in 1990 to 21 percent in 2001.[30] Most of this improvement has occurred in East and South Asia.[39] In East Asia the World Bank reported that "The poverty headcount rate at the $2-a-day level is estimated to have fallen to about 27 percent [in 2007], down from 29.5 percent in 2006 and 69 percent in 1990."[40] In Sub-Saharan Africa extreme poverty went up from 41 percent in 1981 to 46 percent in 2001,[41] which combined with growing population increased the number of people living in extreme poverty from 231 million to 318 million.[42]

In the early 1990s some of the transition economies of Central and Eastern Europe and Central Asia experienced a sharp drop in income.[43] The collapse of the Soviet Union resulted in large declines in GDP per capita, of about 30 to 35% between 1990 and the trough year of 1998 (when it was at its minimum). As a result, poverty rates also increased although in subsequent years as per capita incomes recovered the poverty rate dropped from 31.4% of the population to 19.6%.[44][45]

World Bank data shows that the percentage of the population living in households with consumption or income per person below the poverty line has decreased in each region of the world since 1990:[46][47]

Region$1 per day$1.25 per day[48]
19902002200419812008
East Asia and Pacific15.40%12.33%9.07%77.2%14.3%
Europe and Central Asia3.60%1.28%0.95%1.9%0.5%
Latin America and the Caribbean9.62%9.08%8.64%11.9%6.5%
Middle East and North Africa2.08%1.69%1.47%9.6%2.7%
South Asia35.04%33.44%30.84%61.1%36%
Sub-Saharan Africa46.07%42.63%41.09%51.5%47.5%
World52.2%22.4%

According to Chen and Ravallion, about 1.76 billion people in developing world lived above $1.25 per day and 1.9 billion people lived below $1.25 per day in 1981. The world's population increased over the next 25 years. In 2005, about 4.09 billion people in developing world lived above $1.25 per day and 1.4 billion people lived below $1.25 per day (both 1981 and 2005 data are on inflation adjusted basis).[49][50] Some scholars caution that these trends are subject to various assumptions and not certain. Additionally, they note that the poverty reduction is not uniform across the world; economically prospering countries such as China, India and Brazil have made more progress in absolute poverty reduction than countries in other regions of the world.[51]

The absolute poverty measure trends noted above are supported by human development indicators, which have also been improving. Life expectancy has greatly increased in the developing world since World War II and is starting to close the gap to the developed world.[citation needed]Child mortality has decreased in every developing region of the world.[52] The proportion of the world's population living in countries where per-capita food supplies are less than 2,200 calories (9,200 kilojoules) per day decreased from 56% in the mid-1960s to below 10% by the 1990s. Similar trends can be observed for literacy, access to clean water and electricity and basic consumer items.[53]

Relative poverty[edit]

See also: Relative deprivation

Relative poverty views poverty as socially defined and dependent on social context, hence relative poverty is a measure of income inequality. Usually, relative poverty is measured as the percentage of the population with income less than some fixed proportion of median income. There are several other different income inequality metrics, for example, the Gini coefficient or the Theil Index.

Relative poverty is the "most useful measure for ascertaining poverty rates in wealthy developed nations".[54][55][56][57][58] Relative poverty measure is used by the United Nations Development Program (UNDP), the United Nations Children's Fund (UNICEF), the Organisation for Economic Co-operation and Development (OECD) and Canadian poverty researchers.[54][55][56][57][58] In the European Union, the "relative poverty measure is the most prominent and most–quoted of the EU social inclusion indicators".[59]

"Relative poverty reflects better the cost of social inclusion and equality of opportunity in a specific time and space."[60]

"Once economic development has progressed beyond a certain minimum level, the rub of the poverty problem – from the point of view of both the poor individual and of the societies in which they live – is not so much the effects of poverty in any absolute form but the effects of the contrast, daily perceived, between the lives of the poor and the lives of those around them. For practical purposes, the problem of poverty in the industrialized nations today is a problem of relative poverty (page 9)."[60][61]

In 1776 Adam Smith in the Wealth of Nations argued that poverty is the inability to afford, "not only the commodities which are indispensably necessary for the support of life but whatever the custom of the country renders it indecent for creditable people, even of the lowest order, to be without".[62][63]

In 1958 J. K. Galbraith argued that "People are poverty stricken when their income, even if adequate for survival, falls markedly behind that of their community."[63][64]

In 1964 in a joint committee economic President's report in the United States, Republicans endorsed the concept of relative poverty. "No objective definition of poverty exists... The definition varies from place to place and time to time. In America as our standard of living rises, so does our idea of what is substandard."[63][65]

In 1965 Rose Friedman argued for the use of relative poverty claiming that the definition of poverty changes with general living standards. Those labeled as poor in 1995 would have had "a higher standard of living than many labeled not poor" in 1965.[63][66]

In 1979, British sociologist, Peter Townsend published his famous definition, "individuals ... can be said to be in poverty when they lack the resources to obtain the types of diet, participate in the activities and have the living conditions and amenities which are customary, or are at least widely encouraged or approved, in the societies to which they belong (page 31)".[67] This definition and measurement of poverty was profoundly linked to the idea that poverty and societal participation are deeply associated.[68]

Peter Townsend transformed the conception of poverty, viewing it not simply as lack of income but as the configuration of the economic conditions that prevent people from being full members of the society (Townsend, 1979;[67] Ferragina et al. 2016[68]). Poverty reduces the ability of people to participate in society, effectively denying them full citizenship (as suggested by T.H. Marshall). Given that there are no universal principles by which to determine the minimum threshold of participation equating to full membership of society, Townsend argued that the appropriate measure would necessarily be relative to any particular cultural context. He suggested that in each society there should be an empirically determinable 'breakpoint' within the income distribution below which participation of individuals collapses, providing a scientific basis for fixing a poverty line and determining the extent of poverty (Ferragina et al. 2016[68]).

Brian Nolan and Christopher T. Whelan of the Economic and Social Research Institute (ESRI) in Ireland explained that "Poverty has to be seen in terms of the standard of living of the society in question."[69]

Relative poverty measures are used as official poverty rates by the European Union, UNICEF, and the OEDC. The main poverty line used in the OECD and the European Union is based on "economic distance", a level of income set at 60% of the median household income.[70]

Other aspects[edit]

Economic aspects of poverty focus on material needs, typically including the necessities of daily living, such as food, clothing, shelter, or safe drinking water. Poverty in this sense may be understood as a condition in which a person or community is lacking in the basic needs for a minimum standard of well-being and life, particularly as a result of a persistent lack of income. The increase in poverty runs parallel sides with unemployment, hunger, and higher crime rate.

Analysis of social aspects of poverty links conditions of scarcity to aspects of the distribution of resources and power in a society and recognizes that poverty may be a function of the diminished "capability" of people to live the kinds of lives they value. The social aspects of poverty may include lack of access to information, education, health care, social capital or political power.[68][71][72]

Poverty levels are snapshot pictures in time that omits the transitional dynamics between levels. Mobility statistics supply additional information about the fraction who leave the poverty level. For example, one study finds that in a sixteen-year period (1975 to 1991 in the U.S.) only 5% of those in the lower fifth of the income level were still at that level, while 95% transitioned to a higher income category.[73] Poverty levels can remain the same while those who rise out of poverty are replaced by others. The transient poor and chronic poor differ in each society. In a nine-year period ending in 2005 for the U.S., 50% of the poorest quintile transitioned to a higher quintile.[74]

Poverty may also be understood as an aspect of unequal social status and inequitable social relationships, experienced as social exclusion, dependency, and diminished capacity to participate, or to develop meaningful connections with other people in society.[75][76][77] Such social exclusion can be minimized through strengthened connections with the mainstream, such as through the provision of relational care to those who are experiencing poverty.

The World Bank's "Voices of the Poor," based on research with over 20,000 poor people in 23 countries, identifies a range of factors which poor people identify as part of poverty. These include:

  • Abuse by those in power
  • Dis-empowering institutions
  • Excluded locations
  • Gender relationships
  • Lack of security
  • Limited capabilities
  • Physical limitations
  • Precarious livelihoods
  • Problems in social relationships
  • Weak community organizations
  • Discrimination

David Moore, in his book The World Bank, argues that some analysis of poverty reflect pejorative, sometimes racial, stereotypes of impoverished people as powerless victims and passive recipients of aid programs.[78]

Ultra-poverty, a term apparently coined by Michael Lipton,[79] connotes being amongst poorest of the poor in low-income countries. Lipton defined ultra-poverty as receiving less than 80 percent of minimum caloric intake whilst spending more than 80% of income on food. Alternatively a 2007 report issued by International Food Policy Research Institute defined ultra-poverty as living on less than 54 cents per day.[80]

Asset poverty is an economic and social condition that is more persistent and prevalent than income poverty.[81] It can be defined as a household's inability to access wealth resources that are enough to provide for basic needs for a period of three months. Basic needs refer to the minimum standards for consumption and acceptable needs.Wealth resources consist of home ownership, other real estate (second home, rented properties, etc.), net value of farm and business assets, stocks, checking and savings accounts, and other savings (money in savings bonds, life insurance policy cash values, etc.).Wealth is measured in three forms: net worth, net worth minus home equity, and liquid assets. Net worth consists of all the aspects mentioned above. Net worth minus home equity is the same except it does not include home ownership in asset calculations. Liquid assets are resources that are readily available such as cash, checking and savings accounts, stocks, and other sources of savings. There are two types of assets: tangible and intangible. Tangible assets most closely resemble liquid assets in that they include stocks, bonds, property, natural resources, and hard assets not in the form of real estate. Intangible assets are simply the access to credit, social capital, cultural capital, political capital, and human capital.

Characteristics[edit]

The effects of poverty may also be causes as listed above, thus creating a "poverty cycle" operating across multiple levels, individual, local, national and global.

Health[edit]

Main articles: Diseases of poverty and Disability and poverty

One third of deaths – some 18 million people a year or 50,000 per day – are due to poverty-related causes. People of color, women and children, are over represented among the global poor and these effects of severe poverty.[82][83][84] Those living in poverty suffer disproportionately from hunger or even starvation and disease.[85] Those living in poverty suffer lower life expectancy.[86] According to the World Health Organization, hunger and malnutrition are the single gravest threats to the world's public health and malnutrition is by far the biggest contributor to child mortality, present in half of all cases.[87]

Almost 90% of maternal deaths during childbirth occur in Asia and sub-Saharan Africa, compared to less than 1% in the developed world.[88] Those who live in poverty have also been shown to have a far greater likelihood of having or incurring a disability within their lifetime.[89]Infectious diseases such as malaria and tuberculosis can perpetuate poverty by diverting health and economic resources from investment and productivity; malaria decreases GDP growth by up to 1.3% in some developing nations and AIDS decreases African growth by 0.3–1.5% annually.[90][91][92]

A pair of studies of the influence of poverty on the ability to reason about complicated issues requiring an immediate solution found that poverty directly impedes cognitive function. Financial worries appear to put a severe burden on one's mental resources so that they are no longer fully available for solving complicated problems. The reduced capability for problem solving can lead to suboptimal decisions and further perpetuate poverty.[93]

Infectious diseases continue to blight the lives of the poor across the world. An estimated 40 million people are living with HIV/AIDS, with 3 million deaths in 2004. Every year there are 350–500 million cases of malaria, with 1 million fatalities: Africa accounts for 90 percent of malarial deaths and African children account for over 80 percent of malaria victims worldwide.[94]

Hunger[edit]

Main article: Hunger

See also: Malnutrition

Rises in the costs of living make poor people less able to afford items. Poor people spend a greater portion of their budgets on food than wealthy people. As a result, poor households and those near the poverty threshold can be particularly vulnerable to increases in food prices. For example, in late 2007 increases in the price of grains[95] led to food riots in some countries.[96][97][98] The World Bank warned that 100 million people were at risk of sinking deeper into poverty.[99] Threats to the supply of food may also be caused by drought and the water crisis.[100]Intensive farming often leads to a vicious cycle of exhaustion of soil fertility and decline of agricultural yields.[101] Approximately 40% of the world's agricultural land is seriously degraded.[102][103] In Africa, if current trends of soil degradation continue, the continent might be able to feed just 25% of its population by 2025, according to United Nations University's Ghana-based Institute for Natural Resources in Africa.[104] Every year nearly 11 million children living in poverty die before their fifth birthday. 1.02 billion people go to bed hungry every night.[105]

According to the Global Hunger Index, Sub-Saharan Africa had the highest child malnutrition rate of the world's regions over the 2001–2006 period.[106]

Efforts to end hunger and undernutrition[edit]

As part of the Sustainable Development Goals the global community has made the elimination of hunger and undernutrition a priority for the coming years. While the Goal 2 of the SDGs aims to reach this goal by 2030[107] a number of initiatives aim to achieve the goal 5 years earlier, by 2025:

  • The partnership Compact2025, led by IFPRI with the involvement of UN organisations, NGOs and private foundations[108] develops and disseminates evidence-based advice to politicians and other decision-makers aimed at ending hunger and undernutrition in the coming 10 years, by 2025.[109] It bases its claim that hunger can be ended by 2025 on a report by Shenggen Fan and Paul Polman that analyzed the experiences from China, Vietnam, Brazil and Thailand.[110]
  • The European Union and the Bill & Melinda Gates Foundation have launched a partnership to combat Undernutrition in June 2015. The program will initiatilly be implemented in Bangladesh, Burundi, Ethiopia, Kenya, Laos and Niger and will help these countries to improve information and analysis about nutrition so they can develop effective national nutrition policies.[111]
  • The Food and Agriculture Organization of the UN has created a partnership that will act through the African Union's CAADP framework aiming to end hunger in Africa by 2025. It includes different interventions including support for improved food production, a strengthening of social protection and integration of the right to food into national legislation.[112]

Education[edit]

See also: Impact of health on intelligence, Social determinants of health in poverty § Education, and Disability and poverty § Education

Research has found that there is a high risk of educational underachievement for children who are from low-income housing circumstances. This is often a process that begins in primary school for some less fortunate children. Instruction in the US educational system, as well as in most other countries, tends to be geared towards those students who come from more advantaged backgrounds. As a result, children in poverty are at a higher risk than advantaged children for retention in their grade, special deleterious placements during the school's hours and even not completing their high school education.[113] Advantage breeds advantage.[114] There are indeed many explanations for why students tend to drop out of school. One is the conditions of which they attend school. Schools in poverty-stricken areas have conditions that hinder children from learning in a safe environment. Researchers have developed a name for areas like this: an urban war zone is a poor, crime-laden district in which deteriorated, violent, even war-like conditions and underfunded, largely ineffective schools promote inferior academic performance, including irregular attendance and disruptive or non-compliant classroom behavior.[115] Because of poverty, "Students from low-income families are 2.4 times more likely to drop out than middle-income kids, and over 10 times more likely than high-income peers to drop out"[116]

For children with low resources, the risk factors are similar to others such as juvenile delinquency rates, higher levels of teenage pregnancy, and the economic dependency upon their low-income parent or parents.[113] Families and society who submit low levels of investment in the education and development of less fortunate children end up with less favorable results for the children who see a life of parental employment reduction and low wages. Higher rates of early childbearing with all the connected risks to family, health and well-being are major important issues to address since education from preschool to high school are both identifiably meaningful in a life.[113]

Poverty often drastically affects children's success in school. A child's "home activities, preferences, mannerisms" must align with the world and in the cases that they do not do these, students are at a disadvantage in the school and, most importantly, the classroom.[117] Therefore, it is safe to state that children who live at or below the poverty level will have far less success educationally than children who live above the poverty line. Poor children have a great deal less healthcare and this ultimately results in many absences from the academic year. Additionally, poor children are much more likely to suffer from hunger, fatigue, irritability, headaches, ear infections, flu, and colds.[117] These illnesses could potentially restrict a child or student's focus and concentration.[118]

For a child to grow up emotionally healthy, the children under three need "A strong, reliable primary caregiver who provides consistent and unconditional love, guidance, and support. Safe, predictable, stable environments. Ten to 20 hours each week of harmonious, reciprocal interactions. This process, known as attunement, is most crucial during the first 6–24 months of infants' lives and helps them develop a wider range of healthy emotions, including gratitude, forgiveness, and empathy. Enrichment through personalized, increasingly complex activities".

Harmful spending habits mean that the poor typically spend about 2 percent of their income educating their children but larger percentages of alcohol and tobacco (For example, 6 percent in Indonesia and 8 percent in Mexico).[119]

Participation[edit]

See also: Participation (decision making) and Social capital

Poverty has been also considered a real social phenomenon reflecting more the consequences of a lack of income than the lack of income per se (Ferragina et al. 2016[68]). According to Townsend: humans are social animals entangled in a web of relationships, which exert complex and changing pressures, as much in their consumption of goods and services as in any other aspect of their behaviour (Townsend 1979[77]). This idea has received theoretical support from scholars and extensive testimony from people experiencing poverty across the globe (Walker 2014[120]). Participation and consumption have become ever more crucial mechanisms through which people establish and communicate their identity and position in society, increasing the premium attached to resources needed to participate (Giddens 1991[121]). In addition, the concept of social exclusion has been added to the lexicon of poverty related terms, describing the process by which people, especially those on low incomes, can become socially and politically detached from mainstream society and its associated resources and opportunities (Cantillon 1997[122]). Equally western society have become more complex with ethnic diversity, multi-culturalism and life-style choices raising the possibility that a single concept of poverty as conceived in the past might no longer apply (Ferragina et al. 2016[68]).

Shelter[edit]

See also: Slums, Street children, and Orphanages

Poverty increases the risk of homelessness.[124] Slum-dwellers, who make up a third of the world's urban population, live in a poverty no better, if not worse, than rural people, who are the traditional focus of the poverty in the developing world, according to a report by the United Nations.[125]

There are over 100 million street children worldwide.[126] Most of the children living in institutions around the world have a surviving parent or close relative, and they most commonly entered orphanages because of poverty.[123] It is speculated that, flush with money, orphanages are increasing and push for children to join even though demographic data show that even the poorest extended families usually take in children whose parents have died.[123] Experts and child advocates maintain that orphanages are expensive and often harm children's development by separating them from their families and that it would be more effective and cheaper to aid close relatives who want to take in the orphans.[123]

Utilities[edit]

Water and sanitation[edit]

As of 2012, 2.5 billion people lack access to sanitation services and 15% practice open defecation.[127] Water utility subsidies tend to subsidize water consumption by those connected to the supply grid, which is typically skewed towards the richer and urban segment of the population and those outside informal housing. As a result of heavy consumption subsidies, the price of water decreases to the extent that only 30%, on average, of the supplying costs in developing countries is covered.[128][129] This results in a lack of incentive to maintain delivery systems, leading to losses from leaks annually that are enough for 200 million people.[128][130] This also leads to a lack of incentive to invest in expanding the network, resulting in much of the poor population being unconnected to the network. Instead, the poor buy water from water vendors for, on average, about five to 16 times the metered price.[128][131] However, subsidies for laying new connections to the network rather than for consumption have shown more promise for the poor.[129]

Electricity[edit]

Similarly, the poorest fifth receive 0.1% of the world's lighting but pay a fifth of total spending on light, accounting for 25 to 30 percent of their income.[132] Indoor air pollution from burning fuels kills 2 million, with almost half the deaths from pneumonia in children under 5.[133] Fuel from Bamboo burns more cleanly and also matures much faster than wood, thus also reducing deforestation.[133] Additionally, using solar panels is promoted as being cheaper over the products' lifetime even if upfront costs are higher.[132] Thus, payment schemes such as lend-to-own programs are promoted and up to 14% of Kenyan households use solar as their primary energy source.[134]

Violence[edit]

See also: Slavery and Human trafficking

According to experts, many women become victims of trafficking, the most common form of which is prostitution, as a means of survival and economic desperation.[135] Deterioration of living conditions can often compel children to abandon school to contribute to the family income, putting them at risk of being exploited.[136] For example, in Zimbabwe, a number of girls are turning to sex in return for food to survive because of the increasing poverty.[137] According to studies, as poverty decreases there will be fewer and fewer instances of violence.[138]

In one survey, 67% of children from disadvantaged inner cities said they had witnessed a serious assault, and 33% reported witnessing a homicide.[139] 51% of fifth graders from New Orleans (median income for a household: $27,133) have been found to be victims of violence, compared to 32% in Washington, DC (mean income for a household: $40,127).[140]

Personality[edit]

Max Weber and some schools of modernization theory suggest that cultural values

A poor boy sitting in the streets of Mumbai.
Percentage of population living on less than $1.25 per day, per UN data from 2000–2006.
Children of the Depression-era migrant workers, Arizona, 1937
Life expectancy has been increasing and converging for most of the world. Sub-Saharan Africa has recently seen a decline, partly related to the AIDS epidemic. Graph shows the years 1950–2005.
An early morning outside the Opera Tavern in Stockholm, with a gang of beggars waiting for delivery of the scraps from the previous day. Sweden, 1868.
A Somali boy receiving treatment for malnourishment at a health facility.
Street child in Bangladesh. Aiding relatives financially unable to but willing to take in orphans is found to be more effective by cost and welfare than orphanages.[123]
The urban poor buy water from water vendors for, on average, about five to 16 times the metered price.[128]

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