Chapter 14- Poverty and Income Support Policies.ppt
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1、Chapter 14: Poverty and Income Support Policies,“The federal government declared a war on poverty, and poverty won” Ronald Reagan, Former President of the United States, State of the Union Message, 1988“There was never a war on poverty. Maybe there was a skirmish on poverty.” Andrew Cuomo, Governor
2、of New York, former U.S. Secretary of Housing and Urban Development,Views of Poverty,Schiller (2004, pp. 4-7) offers three alternative views of the causes of poverty. The flawed character view blames poverty on the poors lack of motivation or skills. The restricted opportunity view blames poverty on
3、 societys barriers to opportunity. According to this view the poor are often trapped in poverty by inadequate education and services as well as class and race barriers. Finally, the big brother view blames the disincentive effects of government policy for at least some of the income and employment p
4、roblems of the poor.,What is Poverty?,“Poverty is hunger. Poverty is lack of shelter. Poverty is being sick and not being able to see a doctor. Poverty is not having access to school and not knowing how to read. Poverty is not having a job, is fear for the future, living one day at a timePoverty is
5、powerlessness, lack of representation and freedom.” World Bank,Absolute Poverty in Less Developed Countries,Common standards such as $1.25 or $2 per day have been developed.,The United States Absolute Poverty Measure,The official measure varies by family size and is adjusted for inflation each year.
6、,Who are the U.S. Poor?,Trends vary widely for different groups. The “Great Recession” increased poverty, but not for all groups,Criticisms of the U.S. Poverty Line,See the text for a discussion of this topic, and discuss whether you consider the official poverty line to be too low, too high, or app
7、roximately accurate.,Alternative Poverty Measures,The U.S. Supplementary Poverty Index,This alternative produces a slightly higher overall poverty rate but larger changes in poverty rates for some groups.Table 14-5: Official and Supplementary Poverty Rates by Group,Extreme Poverty and the Poverty Ga
8、p,Two measures of extreme poverty: Households with incomes below of the official poverty line. For example, the official U.S. poverty rate rose from 11.3% in 2000 to 15% in 2011. Over the same time period the percent of persons with incomes below of the official poverty line rose from 4.5% to 6.6%.
9、The poverty gap is the average difference between the poverty line and a persons income. In 2012 the mean poverty gap per person in poor families was $2,806, and for unrelated single persons in poverty the mean gap was $6,542 (U.S. Census Bureau, 2012).,Multidimensional Poverty Measures,Social exclu
10、sion refers to the inability of some households to gain access to adequate income and services based on that nations values. For European nations, this measure involves a combination of relative income deprivation and separate measures of inadequate housing, education, employment, health, and other
11、services. (Marlier, et. al. 2012; European Commission, pp. 7-15). The Multidimensional Poverty Index (MPI), measures the lack of access to 10 different measures of well-being for 104 nations (Alkire, et. al.).,The Multidimensional Poverty Index,Table 14-6: Multidimensional and Income Poverty, Select
12、ed Countries,Relative Poverty,Measures of Inequality,The Lorenz Curve,The Lorenz Curve is a graph that measures the cumulative population on the horizontal axis and the cumulative income on the vertical. The curved line is the Lorenz Curve, which represents the actual cumulative distribution of inco
13、me in a society. The larger the area between the two curves (area A in 14-1), the more inequality exists in that society.,The Gini Coefficient,. In Figure 14-1 the Gini Coefficient is the ratio of Area A over areas A + B. In a nation with perfect equality, the Gini coefficient would equal zero since
14、 area A would not exist.,A Gini Coefficient Example,The 2002 Gini Coefficient can be calculated without calculus by identifying the various rectangles and triangles in area B. One can also use the 5 trapezoid areas for a shorter calculation. The Gini coefficient for 1968 is about .362. The 2002 Gini
15、 is over .4.,Harms of Inequality,Inequality is a significant ethical issue. Unhappiness (Alesina, DeTella and MacCulloch), health (Etienne, Skalli and Theodossiou), crime, and carbon dioxide emissions (Baek and Grousch) are correlated with inequality. Economic mobility across generations may be nega
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