Absolute poverty

Definition

Absolute poverty refers to a condition where an individual or a household is unable to meet the basic necessities for survival, such as food, clean water, shelter, and clothing. This concept is crucial for understanding poverty because it provides a clear benchmark for measuring economic hardship. Absolute poverty is often defined using specific income thresholds that reflect the minimum requirements to maintain a basic standard of living.

5 Must Know Facts For Your Next Test

1. Absolute poverty is commonly measured by income levels below $1.90 per day, a threshold defined by the World Bank for extreme poverty.
2. It emphasizes the lack of resources necessary to secure basic life-sustaining needs rather than relative economic comparisons.
3. Regions most affected by absolute poverty are often in Sub-Saharan Africa and South Asia, where access to basic services is limited.
4. Efforts to combat absolute poverty focus on economic development strategies aimed at increasing income and improving access to essential services.
5. Indicators such as child mortality rates and malnutrition levels are often used alongside income measures to assess absolute poverty more comprehensively.

Review Questions

• How does absolute poverty differ from relative poverty in terms of measurement and implications for policy?
  • Absolute poverty focuses on the minimum income necessary to meet basic survival needs, while relative poverty considers income in relation to societal standards. This distinction is important for policy because addressing absolute poverty requires direct interventions aimed at increasing access to basic necessities, whereas relative poverty may prompt policies aimed at wealth redistribution and social welfare programs. Understanding this difference helps tailor effective strategies to address the specific needs of impoverished populations.
• Discuss the significance of the $1.90 per day threshold in measuring absolute poverty and its impact on global economic policies.
  • The $1.90 per day threshold set by the World Bank serves as a critical benchmark for identifying those living in extreme absolute poverty. It influences global economic policies by guiding international aid programs and development strategies aimed at eradicating extreme poverty. By focusing resources on areas with populations living below this threshold, policymakers can better target interventions that improve living conditions and promote economic growth.
• Evaluate the effectiveness of current strategies employed to reduce absolute poverty globally, considering their potential strengths and weaknesses.
  • Current strategies to reduce absolute poverty include targeted cash transfer programs, microfinance initiatives, and investments in education and health services. While these approaches can empower individuals and promote economic independence, their effectiveness can be hampered by systemic issues such as corruption, lack of infrastructure, and inadequate access to markets. A comprehensive evaluation must consider both immediate relief efforts and long-term structural changes necessary for sustainable development, ensuring that all individuals have opportunities to escape absolute poverty.

Related terms

relative poverty: Relative poverty is a condition where individuals or households lack the minimum income needed to maintain the average standard of living in their society, which can vary significantly depending on social context.

poverty line:

The poverty line is an income threshold established by governments or organizations to determine who falls under the category of being poor, often used to assess absolute poverty.

multidimensional poverty: Multidimensional poverty takes into account various deprivations that affect individuals' well-being, including education, health, and living standards, beyond just income measures.