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🔝Social Stratification

Global poverty is a complex issue rooted in economic, political, and social factors. It affects billions worldwide, with the highest concentrations in Sub-Saharan Africa and South Asia. Poverty's impacts extend beyond income, influencing health, education, and social mobility.

Addressing global poverty involves international aid, microfinance, education initiatives, and sustainable development goals. Challenges include corruption, cultural barriers, and climate change impacts. The World Bank, IMF, and NGOs play crucial roles in poverty reduction efforts, though their approaches sometimes face criticism.

Definition of global poverty

  • Global poverty encompasses the economic and social conditions that deprive individuals of basic necessities and opportunities for a dignified life
  • Relates to social stratification by highlighting the unequal distribution of resources and opportunities across different segments of the global population
  • Serves as a fundamental concept in understanding how economic disparities contribute to social hierarchies and limited mobility

Absolute vs relative poverty

Top images from around the web for Absolute vs relative poverty
Top images from around the web for Absolute vs relative poverty
  • Absolute poverty measures individuals living below a fixed income threshold regardless of overall societal wealth
  • Relative poverty compares an individual's economic situation to the average standard of living in their society
  • World Bank defines extreme poverty as living on less than $1.90 per day (2011 PPP)
  • Relative poverty often set at 50-60% of a country's median income
  • Both measures crucial for understanding the multidimensional nature of poverty in different contexts

Poverty line measurements

  • Poverty lines establish thresholds below which individuals are considered poor
  • International poverty line set by World Bank at $1.90 per day for extreme poverty
  • National poverty lines vary based on country-specific economic conditions and living standards
  • Multidimensional poverty index (MPI) incorporates factors beyond income (health, education, living standards)
  • Purchasing power parity (PPP) adjustments account for differences in cost of living across countries

Causes of global poverty

Economic factors

  • Lack of economic growth and job opportunities in developing countries
  • Unequal distribution of wealth and resources within and between nations
  • Structural unemployment due to skills mismatch or technological changes
  • Debt burdens limiting government spending on social programs and infrastructure
  • Economic shocks and recessions disproportionately affecting vulnerable populations

Political instability

  • Civil wars and conflicts disrupt economic activities and destroy infrastructure
  • Corruption diverts resources from public services and development projects
  • Weak institutions fail to implement effective poverty reduction policies
  • Political violence and human rights abuses force displacement and migration
  • Lack of democratic processes hinders representation of marginalized groups

Environmental challenges

  • Climate change impacts agricultural productivity and food security
  • Natural disasters (droughts, floods) destroy livelihoods and assets
  • Environmental degradation reduces access to natural resources (clean water, arable land)
  • Pollution affects health outcomes and increases healthcare costs
  • Resource scarcity leads to conflicts and further economic instability

Historical colonialism

  • Exploitation of resources and labor during colonial periods
  • Disruption of traditional economic systems and social structures
  • Creation of extractive institutions that persist post-independence
  • Unequal trade relationships established between colonizers and colonies
  • Cultural and educational impositions hindering local development

Global poverty statistics

Geographic distribution

  • Sub-Saharan Africa has the highest concentration of extreme poverty (41% of population)
  • South Asia follows with significant poverty rates (24% of population)
  • Latin America and the Caribbean show lower but persistent poverty levels
  • East Asia and Pacific have made substantial progress in poverty reduction
  • Middle East and North Africa face increasing poverty due to conflicts and instability

Poverty rates by country

  • Nigeria has the highest number of people living in extreme poverty (86.9 million)
  • Democratic Republic of Congo has 72.5% of its population living below the poverty line
  • India has made significant progress but still has large numbers in poverty (176 million)
  • China has lifted over 800 million people out of poverty since 1978
  • Poverty rates in developed countries are generally much lower but still present (USA: 11.8%)

Urban vs rural poverty

  • Rural areas generally have higher poverty rates than urban areas
  • 80% of people living below the international poverty line reside in rural areas
  • Urban poverty often characterized by informal settlements and lack of basic services
  • Rural poverty linked to limited access to markets, education, and healthcare
  • Urban migration can lead to increased urban poverty and strain on city resources

Effects of global poverty

Health outcomes

  • Higher rates of malnutrition and stunting in children
  • Increased vulnerability to infectious diseases due to poor sanitation and healthcare access
  • Higher maternal and infant mortality rates in impoverished regions
  • Mental health issues exacerbated by stress of poverty and lack of treatment options
  • Shorter life expectancy and higher disability rates among poor populations

Education access

  • Lower school enrollment and attendance rates in poor communities
  • Higher dropout rates due to economic pressures and child labor
  • Gender disparities in education access, particularly in developing countries
  • Poor quality of education in underfunded schools serving low-income areas
  • Limited access to higher education and vocational training for poverty-stricken individuals

Social mobility limitations

  • Intergenerational transmission of poverty due to lack of resources and opportunities
  • Limited access to social networks and information crucial for career advancement
  • Discrimination and stigma associated with poverty hindering social integration
  • Reduced political participation and representation of poor communities
  • Spatial segregation limiting exposure to diverse socioeconomic environments

Economic development barriers

  • Low savings and investment rates in poor households and communities
  • Limited access to credit and financial services for small businesses
  • Underdeveloped infrastructure hindering economic growth and job creation
  • Brain drain as educated individuals migrate for better opportunities
  • Reduced consumer demand limiting market growth and economic diversification

Poverty reduction strategies

International aid programs

  • Bilateral aid agreements between donor and recipient countries
  • Multilateral aid through international organizations (World Bank, UN agencies)
  • Humanitarian assistance for emergency relief in crisis situations
  • Sector-specific aid targeting health, education, or infrastructure development
  • Cash transfer programs providing direct financial support to poor households

Microfinance initiatives

  • Small loans provided to individuals or groups for entrepreneurial activities
  • Savings and insurance products tailored for low-income populations
  • Group lending models promoting social collateral and peer support
  • Financial literacy training to enhance money management skills
  • Integration of mobile banking technologies to increase access and reduce costs

Education and skill development

  • Universal primary education initiatives to increase literacy rates
  • Vocational training programs aligned with labor market demands
  • Scholarship and grant programs for higher education access
  • Adult education and lifelong learning opportunities
  • Digital skills training to prepare for the modern workforce

Sustainable development goals

  • UN's 17 Sustainable Development Goals (SDGs) provide a framework for poverty reduction
  • Goal 1: No Poverty aims to eradicate extreme poverty by 2030
  • Interconnected goals addressing health, education, gender equality, and economic growth
  • National and international commitments to achieve SDG targets
  • Monitoring and evaluation mechanisms to track progress and adjust strategies

Challenges in poverty alleviation

Corruption and mismanagement

  • Embezzlement of funds intended for poverty reduction programs
  • Nepotism and cronyism in the distribution of aid and resources
  • Weak accountability mechanisms in aid delivery and project implementation
  • Bribery and extortion affecting access to public services for the poor
  • Political interference in poverty alleviation efforts for personal gain

Cultural barriers

  • Traditional gender roles limiting women's economic participation
  • Caste systems perpetuating social and economic exclusion
  • Religious beliefs influencing attitudes towards poverty and wealth
  • Cultural stigma associated with certain occupations or lifestyles
  • Resistance to change and adoption of new technologies or practices

Resource allocation issues

  • Competing priorities in national budgets limiting funds for poverty reduction
  • Inefficient targeting of aid leading to leakage to non-poor populations
  • Geographical challenges in reaching remote or isolated communities
  • Short-term focus of many interventions failing to address root causes
  • Lack of coordination among various agencies and organizations

Climate change impacts

  • Increased frequency and severity of natural disasters affecting vulnerable populations
  • Changes in agricultural patterns threatening food security and rural livelihoods
  • Rising sea levels displacing coastal communities and creating climate refugees
  • Health risks from extreme weather events and changing disease patterns
  • Economic disruptions from climate-related events exacerbating existing poverty

Global institutions and poverty

World Bank policies

  • Provision of low-interest loans and grants for development projects
  • Implementation of Poverty Reduction Strategy Papers (PRSPs) in collaboration with countries
  • Research and data collection on global poverty trends and effective interventions
  • Promotion of private sector development and investment in developing countries
  • Conditional lending requiring policy reforms and good governance practices

IMF structural adjustment programs

  • Macroeconomic stabilization measures to address balance of payments issues
  • Fiscal austerity requirements often leading to reduced social spending
  • Privatization of state-owned enterprises to increase efficiency
  • Trade liberalization policies to promote export-led growth
  • Currency devaluation to improve competitiveness in global markets

NGO roles and limitations

  • Direct service provision in areas of health, education, and community development
  • Advocacy for policy changes and increased attention to poverty issues
  • Capacity building for local organizations and communities
  • Innovation in poverty reduction approaches and piloting new interventions
  • Limitations in scale, sustainability, and coordination with government efforts

Poverty and social inequality

Gender disparities

  • Women overrepresented in informal and low-paying jobs
  • Unequal access to education and skills training for girls and women
  • Limited property rights and asset ownership for women in many countries
  • Higher time poverty due to unpaid care work and domestic responsibilities
  • Increased vulnerability to violence and exploitation in poverty situations

Ethnic and racial factors

  • Systemic discrimination limiting economic opportunities for minority groups
  • Spatial segregation concentrating poverty in specific ethnic neighborhoods
  • Unequal access to quality education and healthcare services
  • Overrepresentation of ethnic minorities in the criminal justice system
  • Cultural and linguistic barriers to accessing social services and employment

Intergenerational poverty cycles

  • Limited social mobility due to lack of inherited wealth and social capital
  • Early childhood deprivation affecting cognitive development and future prospects
  • Reduced educational attainment perpetuating low-skill, low-wage employment
  • Health issues passed down through generations due to poor living conditions
  • Psychological impacts of growing up in poverty affecting aspirations and self-efficacy

Globalization and poverty

Economic integration effects

  • Increased trade opportunities for developing countries
  • Foreign direct investment creating jobs in low-wage countries
  • Technology transfer and knowledge spillovers from multinational corporations
  • Exposure to global economic shocks and financial crises
  • Pressure on local industries unable to compete with global markets

Outsourcing and labor markets

  • Job creation in developing countries through business process outsourcing
  • Downward pressure on wages in developed countries for certain job categories
  • Skill premiums for workers able to participate in global value chains
  • Precarious employment conditions in some outsourced industries
  • Disruption of traditional livelihoods unable to adapt to global competition

Technology and job displacement

  • Automation and artificial intelligence threatening low-skill jobs
  • Digital divide exacerbating inequalities in access to information and opportunities
  • New job creation in technology sectors requiring advanced skills
  • Gig economy providing flexible work but often with limited benefits and security
  • Potential for technology to improve productivity and create new economic opportunities

Projected poverty rates

  • World Bank goal to reduce extreme poverty to less than 3% by 2030
  • Challenges in reaching the "last mile" of extreme poverty
  • Potential increase in relative poverty even as absolute poverty declines
  • Regional variations with Sub-Saharan Africa facing the greatest challenges
  • Impact of COVID-19 pandemic potentially reversing progress in poverty reduction

Emerging economic powers

  • Rise of BRICS countries (Brazil, Russia, India, China, South Africa) changing global economic landscape
  • Potential for South-South cooperation in poverty reduction efforts
  • Shifting patterns of aid and investment from emerging economies to developing countries
  • New models of development challenging traditional Western approaches
  • Increased economic competition potentially benefiting some developing regions

Technological solutions

  • Mobile banking and digital financial services increasing financial inclusion
  • Big data and AI applications for more targeted and efficient poverty interventions
  • Renewable energy technologies improving access to electricity in remote areas
  • Telemedicine and e-learning platforms expanding access to health and education
  • Blockchain and other technologies enhancing transparency and reducing corruption in aid delivery


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© 2025 Fiveable Inc. All rights reserved.
AP® and SAT® are trademarks registered by the College Board, which is not affiliated with, and does not endorse this website.