POVERTY

Theories of Poverty



Theories of Poverty

Introduction

Poverty is deprivation of material essentials such as food, shelter, drinking water, and clothing. It is also associated with the lack of education, freedom, and dignity. The uneven distribution of poverty at various scales, from the global to the household, via the national, regional, and local, suggests the importance of geographic factors in explaining its prevalence and understanding its nature. In addition to this, defining poverty in quantitative terms is a controversial issue, as it is influenced by political and moral values, as well as by economics. Discussion

Social Inclusion and Exclusion Indicator

The concept of social exclusion has emerged in the 1970s at a time of massive economic restructuring and attempts to avoid damage to social cohesion and social stability. With the spread of this concept internationally, we started to look into the processes that lead to the exclusion of certain groups and how we could integrate them in social, economic, political and cultural normatively accepted. Efforts to theorize, to model and measure the processes of exclusion and social inclusion illustrate the realization that in any society, a wide range of social dimensions and areas affect the ability to live a meaningful life, although the economic security and job security are the foundations. In addition, mere poverty in terms of income, whether relative or absolute terms, is only one economic factors involved assessment of the strength of theoretical and empirical models, indicators and measures led to the identification of nine areas that give rise to processes of exclusion and social inclusion: employment and occupation, income and economic resources, material resources, education and skills, health, housing, social resources, community resources and, finally, personal safety. Multiple indicators were selected for each of these areas according to their frequency of use and robustness (MacInnes , et al., 2012, pp. 5-50).

This approach seems in theory more reliable, because it allows the measurement of living standards at an individual or household level. In fact, if total consumption of goods and services is what defines standards of living, this can be measured directly where it takes place. Owen O'Donnell and colleagues indicate three main measures of living standards: total consumption, which can be proxied by total expenditures, and household income. Alternatively, living standards can be estimated using specific multivariate techniques, such as factor analysis or principal component analysis, or adjusting for specific consumption variables (MacInnes , et al., 2012, pp. 5-50).

Consumption appears to be considered the most appropriate measure of living standards. This would correspond to all the goods (durable and nondurable) consumed by a person or household in a given time period. Measuring total consumption is a challenging task for three reasons: first, it is difficult to correctly assess the amount of goods consumed, which are not always recorded, and to aggregate them in a single index; second, it is difficult to estimate consumption of durable goods, as these goods are paid for once and used over time. Finally, it is hard to quantify the level of consumption of own-made produce ...