Poverty Flashcards

1
Q

the North-South divide

A

The north south divide is a global socio-economic and political divide

The north and the south have replaced terms such as the west and the third world as descriptions of the variation of economic development in the world

The more economically developed and powerful states such as the US Canada Europe Russia and Australia (Developed) tend to be in the northern hemisphere and poorer Less politically influential states in South America Africa and Asia (Developing) tend to be in the southern hemisphere

The largest percentage of the population living under two dollars a day is in the global south

The north south divide is a socio-economic and political divide between a relatively affluent north where most of the world economic activity takes place on the increasingly marginalised self where poverty and disadvantage exists

The per capita income gap between the north and south has been growing since the 1960s having tripled in size during that time

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2
Q

what is the report linked to the North-South divide?

A

The term north south divide gained currency as a result of the 1980 Brandt Report Into international development issues

However it has not been met with universal acceptance some question its relevance given the miraculous growth of the Chinese economy the emergence of Brazil and India and the growing influence of these countries and international organisations such as the G20

The report led to the development of the Brandt line showing the border between the global north and south

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3
Q

why is the North-South divide contested?

A

The concept of the north south divide is contested as there is variation within both the north and the south that means the time does not apply to every country in each hemisphere

The south has seen poverty become more concentrated in sub-Saharan Africa however the south has also seen the emergence of China Brazil India and South Africa who are all now part of the G 20 and some of the most rapidly developing economic countries

Some of the GDP is surpass the GDP is seen in the global north

Globalisation has also created variations that inequalities within states with women and ethnic minorities and the disabled being particularly disadvantage suggesting the Term is increasingly meaningless

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4
Q

theories of global inequality and poverty

A

Despite world economic growth there is an increasing gap between the richest and poorest countries

Between the early 1960s and the early to thousands the richest 20 states got 300% richer well the poorest 20 only grew by 20%

Two theories of global inequality have been influential in understanding why unequal economic development continues the world systems theory and the dependency theory

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5
Q

the world systems theory: who was it proposed by? what is its basic argument?

A

Developed by sociologist Immanuel Wallerstein

It is an approach to world history and social change that suggests there is a world economic system that has developed as a result of the expansion of capitalism since the 17th century

In this system some countries benefit while others are exploited as such it is a neo-Marxist theory

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6
Q

the world systems theory: what did Wallerstein reject?

A

Wallerstein Rejects the notion of a third world claiming that there is only one world that is connected by economic relations

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7
Q

the world systems theory: how does this theory divide the world?

A

He argues that this system inherently leads to a division of the world into core semi peripheral and peripheral areas

Core areas are those that are economically advanced and dominate over peripheral areas

Peripheral areas are those parts of the world where wages are low technology is basic and the economy is dependent on agriculture all the primary sector low-tech industries such as coal and steel

Semi peripheral areas have some features of core areas and some of peripheral areas they act as a buffer area to ensure that the core areas do not face unified opposition from the rest of the world

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8
Q

world systems theory of poverty

A

Developed by Immanuel Wallerstein

Rejects the idea of a north and south

A neo-Marxist analysis that sees the entire world as one single capitalist economy based on the division of labour between the core Semi-periphery and periphery regions

Core regions benefit from capital and technology exploiting the periphery for raw materials and cheap labour while the semi-periphery acts as an intermediate as it is part core Part periphery

Poverty is an inevitable product of the world system and the system needs replacing by a more Equitable one

CORE — Democratic government welfare services high wages advanced technology import primary products export manufactured goods

PERIPHERY — No democratic government limited or no welfare services below subsistence wages export primary products import manufactured goods

SEMI PERIPHERY — Authoritarian government limited welfare services low wages export and import primary products export certain manufactured goods

The three zones are in an Exploitative relationship where wealth is drained from the periphery to the core

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9
Q

the dependency theory: how is dependency imposed on poor states? how were these structural imbalances created?

A

Emphasises the structural imbalances within capitalism that impose dependency on poor states

These structural imbalances were created by 19th-century imperialism western European countries exploited the natural resources and cheap labour provided by their colonies in Africa South America and in the middle and far east

With decolonisation former colonies became independent states politically but remained economically dependent of their former colonial masters for trade

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10
Q

the dependency theory: how do wealthy states accumulate wealth at the expense of poorer states?

A

This essentially near Marxist theory has much in common with the world systems theory it refers to core and periphery countries

It argues that resources flow from the periphery of poor and underdeveloped countries to a core of wealthy countries which leads to the accumulation of wealth by the rich states at the expense of poor states

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10
Q

the dependency theory: what happens when underdeveloped countries try to resume control? what does this mean for them?

A

When underdeveloped countries try to remove the influence of core countries the developed countries block their attempts to assume control

This means that poverty of developing nations is not the result of the disintegration of these countries in the world system but because of the way in which they are integrated into the system

The poverty of the periphery countries is perpetuated by the structural dependence on the core countries hence dependency theorists argue that underdeveloped countries remain economically valuable unless they reduced their connections to the world market

This suggests that global economic governance and economic globalisation is the cause of continuing poverty in these countries rather than the solution

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12
Q

dependency theory of poverty

A

Argues that the north and south are in a structural relationship with each other and it is a relationship of dependency that creates poverty

The process is Neocolonialism as it involves economic rather than political domination by the north and is promoted by the saps of the IMF and World Bank

The solution was to use the state to nationalise or subsidise local industries and to implement protectionist trade policy is to cut connections to the global market in order to drive development

This is known as import substitution industrialisation — a form of economic policy adopted by southern states as a response to the perception that structure relationships were stopping myself from developing and were in trenching property rather than solving it

this argues that the state should protect infant industries with tariffs and subsidies to decrease dependency on developed countries this allows these industries to develop so they can then compete with imported goods when they are sufficiently developed

The north during colonialism created economies in the south based on the export of primary goods like raw materials and food following decolonisation market forces meant the South suffered from decline in terms of trade as the price of primary goods rises more slowly than the price of manifested goods produced to the court this leads to the south being economically drained by the north

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13
Q

measurement of poverty: how is absolute poverty defined?

A

Poverty is a disputed term

Measures of absolute poverty include the level of deprivation of the necessities of life such as food fuel shelter and clothing

OR the measure used by the World Bank of earning less than $1.25 a day

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14
Q

measurement of poverty: how is poverty defined by the OECD and the EU?

A

However absolute property does not capture the relative nature of poverty

The organisation for economic co-operation and development OECD and the EU define poverty as income that is 50% less than the average household

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15
Q

measurement of poverty: how does Amartya Sen define poverty?

A

Moreover the orthodox measure of poverty is the inability to meet material needs but some commentators such as Amartya Sen Harvard professor of economics and philosophy argue that poverty is not just about income

Sen Advocates and alternative measures of poverty the inability to meet nonmaterial needs

Poverty restricts opportunities such as access to education and equal treatment under the law for the protection of rights which can be just as debilitating as lack of wealth

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16
Q

development theories

A

As there are competing views of poverty there are also different theories about how best to achieve economic development

These theories are significant in that they have informed IMF and World Bank strategies for helping developing countries

Classical economic development theory structural theory neoclassical development theory

17
Q

development theories: CLASSICAL ECONOMIC DEVELOPMENT THEORY

A

Inspired by the 18th and 19th century economic liberalism of Adam Smith and David Ricardo

Closely linked to liberalism international relations theory

Claims that poverty is a lack of income or resources which can be measured by comparing countries GDP per capita

Economic development can be stimulated by Adam Smith’s invisible hand of the market which will ensure that all will ultimately benefit

Countries should free markets privatise state owned industries and focus that economies on producing products in which they have a comparative advantage

18
Q

development theories: STRUCTURAL THEORY

A

And approach to development that originated in South America

Argues that poverty is the product of global inequality perpetuated by TNCs and the conditions attached to development made by donor countries and organisations

In order to end of structural inequality in the international system for states should intervene substantially in the domestic economy to promote industrialisation and reduce the reliance on the export of primary goods such as agricultural and mining products

Developing states should also impose restrictive trade policies to protect domestic industries from external competition and promote trade with other developing countries

The logic of the strategies rests on the infant industry argument young industries initially do not have the economies of scale and experience to be able to compete with foreign competitors and therefore need to be protected until they are able to compete in the free market

19
Q

development theories: NEO-CLASSICAL DEVELOPMENT THEORY

A

Became influential towards the end of the 1970s inspired by the economic policies of Margaret Thatcher and Ronald Reagan

At the same time the World Bank shifted from its basic needs approach to A neoliberal approach in 1980

Essentially classical economic development theory

Inspired the structural adjustment programs imposed on recipients of loans in the 1980s

20
Q

orthodox measure of poverty

A

Poverty remains a highly contested term

The orthodox view is that poverty should be measured in terms of absolute poverty which is not having the money to buy food and satisfy basic material needs

The best way to tackle poverty is development which is measured by growth in GDP

The World Bank measure of poverty is the number of people living on $1.90 or less per day this was around 35% in 1990 but has fallen to just over 10% in 2013

21
Q

what are the 2 issues with the orthodox measure of poverty (measuring poverty through growth in GDP)?

A

Measuring poverty through growth in GDP raises two issues

1) The GDP of the state can be increasing by inequality within the state may also be increasing creating relative poverty this is when people are considered poor if their income is substantially lower than the average person in the country this suggests that poverty and inequality are linked and both need to be tackled
2) This approach only measures income but whether peoples basic needs are being met a wider measure is needed that takes into account human development such as access to education and healthcare gender equality life expectancy self-reliance (ability to provide for oneself and family) and personal and food security

22
Q

the Human Development Index (HDI)

A

The UN development program UNDP has created a new measure of poverty for human development index HDI which is more focused on the capability to fill your own material and nonmaterial needs rather than pure economic growth

HDI includes measuring health (life expectancy at birth), education (mean years of schooling and expected years of schooling) and living standards (gross national income per capita)

23
Q

orthodox development theory

A

The orthodox theory of development is rooted in liberalism and believes that unlimited growth is possible under the free market

Developing economies will reach a takeoff and develop along the lines of western countries with wealth benefiting everyone by trickling down through society underdeveloped countries will therefore become more developed

Measures poverty through economic growth which is measured by GDP

Believes that growth should be a top-down process relying on the expertise technology and capital from outside the state e.g. from western states the IMF World Bank and TNCs

24
Q

the 2 different variants of the orthodox development theory…

A

The orthodox development theory has two different variants

Classical theory based on the ideas of Adam Smith and David Ricardo believes that freetrade without government intervention in competitive markets will drive growth

Neoclassical theory sees the Phalia of underdeveloped states to grow as a result of too much government intervention and regulation of the economy free markets open economies and privatisation will open the state to international trade and trigger growth this theory has underpinned the conditionality of SAPs

25
Q

alternative development theories

A

Believes that development means becoming self reliant And should be aimed Around human well-being

Development should be sustainable locally controlled in gauge with marginalise groups such as indigenous people and be on the local democratic control

Argues that the increasing gap between the rich and the poor can be explained by structural imbalances in the world economy

Measures poverty through the inability To for fill both material and nonmaterial needs through your own effort

The process of development should be bottom-up local control participatory Reliance on local knowledge and technology inclusive and environmentally sound will often involve a far higher level of state intervention that is acceptable and the liberal model and structural inequalities in the world economy

These ideas tend to reflect the views of the global south and have been used to criticise SAPs

26
Q

how many people in the world live on less than $5 a day?

A

Over 4 billion people in the world live on less than five dollars a day which is the minimum necessary for basic human existence

29
Q

how is the structure of the global economic system responsible for a country’s wealth?

A

The fate of Nations is largely due to the structure of the global economic system which has been designed intentionally over 500 years to serve the interests of a handful of rich nations at the expense of most of the rest of the world

Particularly clear during colonialism but we can still see the same patterns today in the form of international trade rules the global finance system the debt system tax evasion and climate change

The amount of money flowing from rich countries to poor countries in the form of eight and four and investment is vastly lower than the amount of money flowing from poor nations to rich nations this means that poor nations are essentially developing rich nations

Arguably we must fix the structural inequalities to tackle poverty

30
Q

key question concerning poverty

A

Has the marginalisation and poverty of the South being driven by globalisation or has this poverty been the result of too little globalisation and not enough integration of poor countries into the global economic system

31
Q

what does the dependency theory and world systems theory have in common?

A

Both the dependency theory and world systems theory view underdevelopment in the south as a result of deliberate economic exploitation by the north