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Poverty
Poverty
• Absolute Poverty: A situation where
individuals do not have access to the
basic requirements of life – food,
shelter, clothing.
• Relative Poverty: A situation where
individuals are excluded from being able
to take part in what are considered the
normal, acceptable standards of living
in a society.
Wealth
Types of Asset
• Shares
• Houses
• Bank deposits
• Land
• Building Society Accounts
• Currency holdings
• Buildings
• Machinery and
Equipment
• Gold We are considerably richer than you!
• Etc. Title: The Fullers. Copyright: Getty Images available from
Education Image Gallery
Income Distribution
• Income represents a FLOW
• £x per week, month, year, etc.
• Income can be in the form of:
– Wages
– Rents
– Dividends
– Interest
– Pensions
– Benefit payments
– Income from self employment
– Inheritance
Income Distribution
• Income can be earned income
(from employment, etc.) or
• Unearned income – inheritance,
benefit payments, pensions, etc.
Income Distribution
Redistribution of Income
Taxation
• Costs
– Market Distortion
– Administrative Costs
– Incentives
– May not impact because some will not be paying tax
– Can be avoided
– May not be targeted at those who need the help
• Benefits
– Reduction in poverty levels
– Can be used to provide incentives
Legislation
Equity
Causes of Inequality
• Individual
• National
Individual
National