gov int reduce poverty

Question 1

what are 5 gov policies to reduce poverty

Answer 1

income redistribution

progressive taxes

national minimum wage

education

provision of public goods

Question 2

how does income redistribution occur

Answer 2

using progressive taxes - income tax - richer pay more - 45% over £150,000 - reduces inequality as poorer pay less - 20% below £31,785 - could give welfare payments

ev - welfare payments lead to reduced incentive to work - fall in gov revenue - shown by gaffer curve

Question 3

how does national minimum wage reduce poverty etc

Answer 3

national living wage £8.61 - ensures all workers access minimum living standards - aims to prevent employers exploiting workers

ev - may lead to wage spiral as people on higher wages will see increased minimum wage and therefore will ask for increase - may cause cost push inflation - making real wage decrease for lower income

Question 4

how does provision of public goods reduce poverty

Answer 4

Gov spending on education and healthcare – provides equal opportunities for people from all income backgrounds – ensure even low income households can afford a good standard of healthcare and education

Question 5

how does provision of education reduce poverty

Answer 5

In developing countries – gov may improve human capital by making education more widely available – might try and diversify the economy in order to stimulate economic growth and job creation - apprenticeship schemes - firms have to give out certain mount of apprenticeship a year

• ev - education has time lag - years of training - long term