What is Poverty and its types?
Poverty is an economic state where people are experiencing scarcity or the lack of certain commodities that are required for the lives of human beings like money and material things. Therefore, poverty is a multifaceted concept inclusive of social, economic and political elements.
The word poverty comes from French word “poverté” which means poor.
Below table compares the 2016 and 2017 versions of the global and regional poverty estimates for 2013:
As per the above table total number of poor increased by 2.5 million (from 766.0 to 768.5 million).
It is complex to define poverty. Because it is depend on multifaceted and multidimensional elements like region, era, geographical condition, circumstances and many more.
On the basis of social, economical and political aspects, there are different ways to identify the type of Poverty:
1. Absolute poverty.
2. Relative Poverty.
3. Situational Poverty.
4. Generational Poverty.
5. Rural Poverty.
6. Urban Poverty.
Now let us understand them one by one:
1. Absolute poverty: Also known as extreme poverty or abject poverty, it involves the scarcity of basic food, clean water, health, shelter, education and information. Those who belong to absolute poverty tend to struggle to live and experience a lot of child deaths from preventable diseases like malaria, cholera and water-contamination related diseases. Absolute Poverty is usually uncommon in developed countries.
It was first introduced in 1990, the “dollar a day” poverty line measured absolute poverty by the standards of the world's poorest countries. In October 2015, the World Bank reset it to $1.90 a day. This number is controversial; therefore each nation has its own threshold for absolute poverty line.
"It is a condition so limited by malnutrition, illiteracy, disease, squalid surroundings, high infant mortality, and low life expectancy as to be beneath any reasonable definition of human decency." Said by Robert McNamara, the former president of the World Bank
2. Relative Poverty: It is defined from the social perspective that is living standard compared to the economic standards of population living in surroundings. Hence it is a measure of income inequality. For example, a family can be considered poor if it cannot afford vacations, or cannot buy presents for children at Christmas, or cannot send its young to the university.
Usually, relative poverty is measured as the percentage of the population with income less than some fixed proportion of median income.
It is a widely used measure to ascertain poverty rates in wealthy developed nations.
In European Union the "relative poverty measure is the most prominent and most–quoted of the EU social inclusion indicators"
3. Situational Poverty: It is a temporary type of poverty based on occurrence of an adverse event like environmental disaster, job loss and severe health problem.
People can help themselves even with a small assistance, as the poverty comes because of unfortunate event.
4. Generational Poverty: It is handed over to individual and families from one generation to the one. This is more complicated as there is no escape because the people are trapped in its cause and unable to access the tools required to get out of it.
“Occurs in families where at least two generations have been born into poverty. Families living in this type of poverty are not equipped with the tools to move out of their situation” (Jensen, 2009).
5. Rural Poverty: It occurs in rural areas with population below 50,000. It is the area where there are less job opportunities, less access to services, less support for disabilities and quality education opportunities. People are tending to live mostly on the farming and other menial work available to the surroundings.
The rural poverty rate is growing and has exceeded the urban rate every year since data collection began in the 1960s. The difference between the two poverty rates has averaged about 5 percent for the last 30 years, with urban rates near 10–15 percent and rural rates near 15–20 percent (Jolliffe, 2004).
6. Urban Poverty: It occurs in the metropolitan areas with population over 50,000. These are some major challenges faced by the Urban Poor:
• Limited access to health and education.
• Inadequate housing and services.
• Violent and unhealthy environment because of overcrowding.
• Little or no social protection mechanism.
Note: “Extreme global poverty could be eliminated by 2025 if the wealthy countries of the world were to increase their combined foreign aid budgets to between $135 billion and $195 billion from 2005 to 2015. In 2004, 1.1 billion people lived in extreme poverty on less than a dollar a day”. Book by Jeffrey Sachs “The End of Poverty”