3.6.1 Poverty and Inequality Flashcards
How is poverty measured in the UK and US?
In the US a basket of goods are used which is seen as the minimum living standard required to live in society. In the UK relative poverty is measured by being 60% below the median household income.
What is an example of a measure of poverty?
Human poverty index which measures the level of education, life expectancy and ability to meet basic human needs. There are 2 types, HPI-1 and HPI-2.
HPI-1 is used for developing economies and looks at the likeliness of living up to the age of 40 and the ability for citizens to meet the basic needs which is measured by the number of underweight children and % of people not using improved water sources.
HPI-2 used for developed economies looks at the likeliness of living up to the age of 60, the % of adults who dont have any literacy skills and those living below th poverty line (below 50% of the median income)
What are measures of inequality?
- Lorenz curve
- Gini coefficient
What is the Lorenz curve?
Curve showing the distribution of income and wealth with the y axis being the % of cumulative income and x axis being the distribution of households.
Straight line from origin shows what perfect equality looks (45 degree line) and the curved line shows the rela distribution. The further away the curve is from the 45 degree line, the more inequality there is. As it means only the fewest % of households own the largest % of the total income in society.
