Comaprative Economies essays

Comaprative Economies essays Understanding And Comparing Patterns Of Global Poverty And Inequality. Global poverty and economic inequality have become the source of a great deal of political and social concern in recent times. The co- existence of great wealth and abject poverty, both among and within countries has caused a great deal of controversy amongst world politicians and economists. Both these groups, politicians and economists, have claimed that the central goals of economic policy have always been both efficiency and equity. Unfortunately, despite this, it can be claimed with certainty that a) relative global and national inequality is increasing and b) that relative income of the poorest citizens of the world has declined absolutely. This rise in global inequality has resulted more so, because of a rise in economic inequality among countries rather than a rise in inequality within countries. As the 1995 (Table 7) World Bank Study on Distribution of Wealth shows, average per- capita income in the U.S is about 152 times greater than in Ethiopia and 62 times greater than India. Compare this with the mean income of the top 10% of the population in Brazil (which has one of the highest degree of national income inequality) as being only 50 times greater than that of the bottom 20%. Despite this until recently, for practical/ political purposes most of the emphasis laid on economic inequalities was at a national level. However, with the advent of the globalization culture which started in the 1980s there has been a slight but obvious drift by countries towards global poverty alleviation policies; since the importance of international relationships and systematic self- preservation were realized. In the first part of this paper, I will use different economic ideas and models that help in explaining the causes and sources of this widening gap between the rich and the poor countries. Since the time of Adam Smith, when he pre...