Income Distribution and Undernutrition by yurtgc548


									Income Distribution and

         Text extracted from
      The World Food Problem
       Leathers & Foster, 2004

Poorest of the Poor
          •   Live in third world
          •   Mostly landless
          •   Work for others, menial jobs
          •   Poorly educated
          •   Illiterate
          •   Superstitious
          •   Squatters who live in huts
          •   Almost no food
          •   Fragmented household
          •   Debt to relatives or lenders
Per capita incomes differ
             • Democratic Republic Congo:
             • Switzerland: $38,330
             • Average person in
               Switzerland makes 500X
               more than in Mozambique.
             • If compute purchasing
               power parity, difference
               between richest and poorest
               countries is 80X
      Human Development Index
                              • Measures quality
                                of life
                              • High income
                                countries have
                                high HDI
                              • Low income
                                countries have low
                              • HDI not perfectly
Human development index map     correlated with
Gini Coefficient
        • Gini coefficient = Area of
          crescent made by Lorenz
           – measures inequity of wealth
        • Lowest inequity is in Japan
           – Gini= 24.9
           – Richest 20% controls 35% of
        • Highest inequity is in Brazil
           – Gini= 60.7
           – Richest 20% controls 64% of
         Global Gini Coefficients

Dark blue = most inequity
               Kuznets Curve

                         • As a country develops,
                           rich must get richer first
                         • Therefore inequity will
                           increase initially
                         • Later, inequity will drop
                           as prosperity increases

Data from 75 countries
Wealthy out-compete poor for food
                • Can outbid poor for
                • Also purchase more
                   – Herd becomes more
                     dependent on grain
                   – Price of grain is bid up
                   – Harder for the poor to
                     buy grain

                            • Overall is Declining
                            • Gini coefficients:
                               – .66 in 1970s
                               – .65 in 1980s
100 million children work      – .63 in 1990s
Extreme Inequity Increasing
U.S. Poor are Wealthy
              • Person at poverty line
                in U.S. has higher
                income than 80% of
                people in the world
              • U.S. Poverty income
                is $9,359/yr
              • 97% poor households
                in U.S. have color TV
Middle Class Decline

          • Middle class is
            disappearing in U.S.
          • Income gap is
            increasing between
            wealthy and poor.
Hunger in the U.S.A.
          • 36.3 million people live in
              households that experience
              hunger or the risk of hunger
               – Includes 13 million children
               – More than one in ten
                 households in the United
                 States (11.2 percent).

          •   Source: Bread for the World Institute

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