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Economics ­ Poverty (29.11.12)


Definition:
In the last 3 decades the number of households with incomes below 40% of the average
level has grown to 10 million
It is estimated that currently a third of children live in poverty ­ around half of these live
in households where no adult…

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Targets set to achieve eradication of poverty
These were set by the New Labour government from 1997 ­ they established a target of
eradicating poverty within a generation

They regularly carry out & publish poverty audits which compare the government's
performance against a set of targets:

Increase in proportion of…

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Government Policy Measures
Policies used by Governments to address poverty will depend upon whether the intention is to
tackle absolute or relative poverty

Absolute Poverty ­ Addressed by introducing measures to raise the income of the very poorest
groups in society

Relative Poverty ­ Using measures to reduce the gap…

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The idea of a `trickle down' remains a controversial one ­ it is unlikely that all groups
experiencing poverty would benefit

Increasing Benefits:

Free ­ market economists believe that it will lead to an increase in voluntary
unemployment
Keynesians think increased government spending in this way can stimulate AD, creating…

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National Minimum Wage Legislation:
Imposing a legal national minimum wage helps to address the problems associated with low
pay.

A NMW must be set above the market equilibrium for it to have any impact

Free market economics argue that setting a minimum wage will distort the forces of supply &…

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