Download Causes of Poverty

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Students should be able to:
 Define and explain the causes of poverty
 Explain the different measures used to measure
wealth/poverty
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“Like slavery and apartheid, poverty is
not natural. It is man‐made and it can be
overcome and eradicated by the actions
of human beings.” – Nelson Mandela,
2005

“People do not die for lack of incomes.
They die for lack of resources.” –
Vandana Shiva, physicist, environmental
activist, eco‐feminist and author.
The European Union’s working definition of poverty is:
“Persons, families and groups of persons whose
resources (material, cultural and social) are so limited
as to exclude them from the minimum acceptable way
of life in the Member State to which they belong”.
Definitions change with time, but this is now the most commonly used
definition of poverty in the industrialised world.
It recognises that poverty is not just about income but about the
effective exclusion of people living in poverty from ordinary living
patterns, customs and activities.
Absolute poverty is measured by comparing a person’s total income against
the total cost of a specific ‘basket’ of essential goods and services. People
with inadequate income to purchase this basket of items are considered to be
living in absolute poverty.
Relative poverty compares a person’s total income and spending patterns
with those of the general population. People with lower income who spend a
larger portion of their income on a basket of goods and services, compared with
a threshold typical of the general population, are considered to be living in
relative poverty.
(Source: http://canadianeconomy.gc.ca)
The World Bank defines absolute (or extreme) poverty as living on
below US$1.25 a day, and moderate poverty as living on US$1.25 US$2 a day. Based on these figures, half the world’s population –
about three billion people - are considered poor, with one in six living
in extreme poverty.
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Poverty is caused by a huge number of
factors, often affecting those who are
already the poorest and most vulnerable.

This happens to individuals and to social
groups; it happens nationally and
internationally.
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Some of the causes of poverty in Australia:
•
Family breakdown
•
Changes in government policy
•
Employment-related problems eg. short-term job contracts, low pay, decline in
local traditional industries, unemployment
•
Social exclusion and no access to benefits or inadequate benefits
•
Drink and drugs dependency
•
Poor health (clinical, medical and emotional)
•
Inadequate pensions
•
Personal debt
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Some of the causes of poverty in
developing countries:
•
Unfair trade
•
HIV and AIDS
•
Debt
•
Conflict
•
Unfair land distribution
•
Natural disasters
•
Lack of access to education
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Published annually by the UN, ranks
nations according to their citizens' quality
of life rather than simply by their
economic figures.
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The HDI measures three dimensions:
 Life expectancy at birth
 Years of schooling
 Standard of living

Measures the market value of all final
goods and services produced in a country
during a period of time, usually a year.

GDP per capita is a country’s GDP divided
by its population.

Measures the total income of a country.

Calculated using GDP plus income earned
by foreign residents minus income from
non-residents in the economy.
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GNI per capita is a country’s GNI (income)
divided by its population.

Financial and technical assistance by
government and non-government (private)
organisations from developed (high
income) to developing (low income)
nations.
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17 Sustainable Development Goals
to end poverty, protect the planet,
and ensure prosperity for all.
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What are the benefits of measuring poverty?

What are the pitfalls? Is the quality of life really
different for those living on US$1 a day, and
those on US$1.01?
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What images do we see of poverty in the world?
Whose perspective are they from?
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How is poverty different in different settings?
Different countries? Rural and urban settings?