Understanding Absolute and Relative Poverty

The focus of this analysis is the article titled "Absolute and Relative Poverty," which explores the distinctions between these two forms of poverty, aiming to provide a clear understanding of their differences. Additionally, the article delves into the role of the World Bank Group in addressing global poverty issues and its advocacy for neoliberalism, western democracy, open markets, and economic structural adjustments.

Introduction

Poverty is a complex and multifaceted issue that has far-reaching implications for individuals, communities, and nations. To comprehend the dynamics of poverty, it is essential to consider three interrelated terms: absolute poverty, relative poverty, and poverty threshold.

Absolute poverty, defined by the World Bank Group, signifies living on less than one dollar a day, a condition in which individuals cannot meet their basic necessities for survival. This form of poverty is most prevalent in Least Developed Countries (LDCs).

On the other hand, relative poverty assesses how individuals at the lowest income levels compare to the rest of the population.

Get quality help now

Bella Hamilton

Verified writer

Proficient in: Globalization

5 (234)

“ Very organized ,I enjoyed and Loved every bit of our professional interaction ”

+84 relevant experts are online

Hire writer

Poverty threshold signifies the income level required for a society to attain a minimal standard of living.

The World Bank Group's Role in Poverty Eradication

The World Bank Group has played a pivotal role in addressing global poverty, advocating for neoliberal economic policies, promoting Western-style democracy, supporting open markets, and implementing structural adjustments in economies worldwide. Established in 1945 at the Bretton Woods Conference in New Hampshire, the World Bank's primary mission was to combat poverty.

In the twenty-first century, a significant milestone in the fight against poverty was the creation of the Millennium Development Goals (MDGs) by the World Bank and the United Nations, with Jeffrey Sachs leading the initiative.

These goals aimed to eliminate poverty by 2015, primarily through economic growth. However, critics of Sachs argue that an exclusive focus on economic growth neglects the significance of addressing relative poverty, which is equally vital in combating poverty.

Globalization and Its Impact on Poverty

Globalization has been a subject of debate regarding its role in poverty reduction. Some researchers argue that globalization has contributed to poverty alleviation, while others contend the opposite. However, neither side can definitively prove its case. The World Bank reported a modest decline in poverty in 1990, suggesting that globalization alone is not a reliable indicator of poverty reduction.

One of the challenges in assessing the impact of globalization on poverty is the absence of standardized measurement methods. Without a universally accepted framework, it becomes challenging to evaluate the effectiveness of globalization in addressing both absolute and relative poverty.

Poverty in America

While poverty is a global issue, its manifestations and dynamics vary significantly between countries. Poverty in the United States, for instance, differs from poverty in Least Developed Countries. In America, poverty is often mitigated through various forms of social support and assistance programs.

Non-profit organizations, including homeless shelters run by volunteers, provide food and shelter to the homeless population. Welfare programs offer financial assistance to low-income individuals and families. These measures, though imperfect, help alleviate the effects of poverty in the United States.

Conclusion

In conclusion, poverty is a multifaceted issue that encompasses absolute poverty, relative poverty, and poverty threshold. The World Bank Group has played a central role in addressing global poverty, advocating for neoliberal economic policies and implementing strategies to combat poverty through economic growth.

However, the exclusive focus on economic growth, as championed by figures like Jeffrey Sachs, has faced criticism for neglecting the importance of addressing relative poverty. Additionally, globalization's impact on poverty remains a subject of debate, with no consensus on its effectiveness.

Poverty in America presents a different landscape, characterized by social support systems and non-profit organizations that provide assistance to those in need. While poverty dynamics vary between nations, it is imperative for humankind to collectively work towards effective solutions to eradicate poverty, regardless of its form or origin.