Understanding Poverty: OECD/EU Measures

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Questions and Answers

What factor is NOT identified as a cause of poverty?

Exposure to natural disasters (correct)

Access to quality education

Poor connections between education and the labor market

Poor health services

Which of the following statistics about poverty are true according to the provided information?

8% of retirees contribute significantly to poverty levels.

72% of employed single women with families live in poverty.

31% of people in Fiji live in poverty according to the CIA fact book. (correct)

35% of single-parent families are unemployed. (correct)

Which of the following is a contributing factor to Ruth's poverty?

Having access to regular healthcare

Receiving a quality education

Responsibilities for family members' care (correct)

Living in a well-connected urban area

What is a concern when measuring poverty?

Conflicting poverty statistics from different sources Signup and view all the answers

Which statement best reflects the impact of geography on poverty?

Agricultural challenges in poor soils can exacerbate poverty. Signup and view all the answers

What is the primary reason that Pacific island people do not live in extreme poverty despite generally low income levels?

Subsistence fishing and farming Signup and view all the answers

What percentage of the global population lives in extreme poverty, defined as living on less than $2.15 per day?

8.5% Signup and view all the answers

Which factor significantly contributes to economic stability in Pacific economies aside from local agriculture?

Remittances from abroad Signup and view all the answers

How is poverty primarily measured in Melanesian countries?

Value of non-monetary assets like pigs and yams Signup and view all the answers

What was the poverty rate in Timor-Leste in Melanesia?

30% Signup and view all the answers

Which of the following is NOT considered a method for reducing poverty in the Pacific region?

Increased tariffs on imports Signup and view all the answers

What is the poverty rate in France as of 2021?

15.6% Signup and view all the answers

What portion of the population in French Polynesia was living below the poverty line in 2022 according to the IWGIA study?

One-fifth Signup and view all the answers

What is the definition of poverty according to the OECD/EU measures?

A household income of under 50% (or 60%) of a country’s median income. Signup and view all the answers

Which of the following is a disadvantage of the OECD/EU poverty rates?

It does not consider regional price variations within a country. Signup and view all the answers

What does the World Bank Poverty Line (WBPL) primarily measure?

Income based on the cost of minimum nutritional, clothing, and housing needs. Signup and view all the answers

Which year did the World Bank increase the poverty line to $1.25 per day?

2008 Signup and view all the answers

Which of the following statements about measuring poverty is accurate?

Many poverty studies define poor individuals based on 'acceptable standard of living', which is subjective. Signup and view all the answers

What is a limitation of the World Bank Poverty Line related to its base sample?

It does not adjust for different climatic conditions affecting needs. Signup and view all the answers

Which measurement method does OECD utilize in the Asia-Pacific region?

World Bank poverty measurement methods. Signup and view all the answers

What aspect of poverty is NOT accounted for by the OECD/EU poverty measures?

Social inclusion metrics. Signup and view all the answers

Study Notes

Poverty Definition

Poverty is a state or condition where an individual or household lacks the financial resources to meet basic living standards.
Defining poverty is complex, with no universally accepted measurement.
A person is often considered poor if they lack resources to meet an "acceptable" standard of living, though this is subjective.

OECD/EU Poverty Measures

Poverty is defined as a household income below 50% (or 60%) of a country's median income.
The OECD/EU poverty rate is calculated by comparing the income of an average-sized family to the median household income of the entire population.
This measure includes the whole household, encompassing students.
It is tied to each country's average income.

Disadvantages of OECD/EU Poverty Rates

Doesn't account for regional price differences within a country.
Ignores food requirements and social inclusion factors.
Only measures income and doesn't include subsistence farming.
Limited to OECD countries (primarily Europe).

World Bank Poverty Line (WBPL)

Poverty is the average minimum cost of nutrition, clothing, and housing required in the 15 poorest countries.
1990: $US1 per day per person (PPP)
2001: $US1.08 per day per person (PPP)
2008: $US1.25 per day per person (PPP) (larger sample)
2015: $US1.90 per day per person (PPP)
2022: $US2.15 per day per person (PPP)
2023: various multi-rate measures.

Disadvantages of WBPL

Only measures income, ignoring education and subsistence farming benefits.
Adjustable for different countries to account for varying costs, but doesn't adjust for differing needs.
Based mainly on 15 poorest countries (mostly sub-Saharan Africa).

Measures of Poverty

Relative poverty: Comparing a person's income to others within the same region, nation, or group.
Absolute poverty: The total number of people living below a designated poverty line.

World Poverty overview (2022)

9.1 million people in the world lived below the monetary poverty line in 2022. The poverty rate is 14.4%.
The poverty rate in France in 2021 was 15.6%.
In 2021, 700 million people globally (8.5% of the population) lived in extreme poverty (less than $2.15 per day), half of whom lived in just five countries.
In Europe, more than 122 million people were at risk of poverty and social exclusion.
The Pacific is the world's thir d poorest region, after Africa and South Asia

Melanesian Poverty

People in Melanesia (Pacific Islands) are often poor, but don't always live in extreme poverty.
Subsistence fishing and farming reduce malnutrition and provide a table full of fresh food.
In 2001, Fiji found that subsistence farming accounted for a significant portion of their GDP, and 70% of their workforce is involved in this sector.
Remittances from workers abroad play a crucial role for many Melanesian families
Poverty reduced by international aid, NGOs, and debt cancellation.
Poverty rates in Vanuatu 10.8%, Solomon Islands 18.7%, Timor-Leste 30%, and PNG 38%
In Melanesia, wealth is often measured in items like pigs, yams, and shells, which works well in local communities, but hinders access to essential services such as healthcare and education.
Globalization has led to an increased need for cash, but many Melanesians lack reliable jobs due to climate change making fishing/farming more difficult. Climate change + lack of cash for essential services compound the challenges.

Lack of quality education/Meaningless lessons
Weak connections between learning and the job market
Lack of trained teachers
Students in remote areas
Poorly educated parents Disparities in education for boys and girls

Causes of Poverty (General Overview)

Unemployment (35%)
Single-parent families (35%)
Unemployment among single women with families (72%)
Farmers, entrepreneurs, and craftspeople (23%)
Workers/employees (18%)
Retired People(8%)
Executives (3%)

Causes of Poverty

Institutions (e.g., police, education, transportation, healthcare)
Culture (e.g., religion's influence on self-reliance)
Geography (e.g., agriculture, soil, climate and disease)
Natural resources playing a double-edged sword( positive in countries with good institutions, but negative in countries with corrupt institutions).

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Description

This quiz explores the definitions and measurements of poverty, focusing on the OECD/EU poverty measures. Learn about the complexities of poverty definitions, the calculations behind the poverty rate, and the limitations of these measures in assessing true living conditions.