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Ch. 4 Poverty PDF
Ch. 4 Poverty PDF
INTRODUCTION
Poverty is a challenge not only for India, but for the entire world as more than one-
fifth of the world’s poor live in India alone and are unable to meet even their basic
needs. The five year plans have always stressed on upliftment of poor people and
achieving a minimum standard of living for all. However, poverty is still one of the
most serious problem.
Meaning of Poverty.
Poverty refers to a state in which an individual is unable to fulfil even the basic
necessities of life.
The minimum requirements include food, housing, clothing, education and health. In
a country, where a big mass of the population is deprived of even minimum
amenities of life for a very long period, then such a country suffers from a vicious
circle of poverty.
Who are Poor?
Poverty is harsh reality for a large section of the Indian Population. Poverty in India
has been studied from two points urban and rural.
Poor in Urban areas. Poor people include push cart vendors, street cobblers, rag
pickers, beggars etc.,
1. They possess few assets
2. They reside in kutcha houses
3. The poorest of them do net even have such dwellings
4. The urban poor are largely the overflow of the rural poor who had migrated to
urban areas in search of alternative employment and livelihood.
Poor in Rural Areas, People include
1. landless agricultural labourers,
2. cultivators with very small landholdings,
3. Landless labourers engaged in a variety of non-agricultural jobs
4. Tenant cultivators with small land holdings.
5. Many rural people do not get to have even two meals a day.
Common characteristics of Poor people.
1. Hunger, starvation and malnutrition.
2. Poor Health
3. Limited Economic Opportunities. They have very limited economic
opportunities due to lack of literacy and skills. So, they face unstable
employment. They are not able to negotiate their legal wages from employers
and are exploited.
4. Debt trap.
5. Lack of facilities of electricity and water.
6. Gender Inequality. Gender inequality prevails within the family in regard to
participation of gainful employment, education and in decision-making. Poor
women receive less care on their way to motherhood.
7. Bigger families.
Measures of Poverty:
The problem of poverty can be overcome only when poor people are
identified. There are two measures to determine the extent of poverty.
1. Relative Poverty
2. Absolute Poverty
Absolute Poor: Refers to the total number of people living below poverty
line. According to absolute measure, around 23.6% of India’s population
is below poverty line. The concept of absolute poverty is relevant for the
less developed countries like India, where there is abundance of poverty.
It helps to measure the number of poor people.
The method of “Poverty line” used to measure absolute poverty does not
differentiate between the very poor and the other poor. It does not
consider social factors that generate and are responsible for poverty, like
illiteracy, ill health, lack of access to resources, discrimination or lack of
civil and political freedoms.
Poverty Line:
In India, ‘poverty Line’ is used as a standard to measure the no.of poor
people.
In poverty line, a standard is fixed in terms of minimum level of
consumption.
Absolute poverty refers to a situation when a person falls to reach
this minimum consumption level.
In context of India, proportion living below ‘Poverty Line’ gives the
absolute measures of poverty.
Measurement of Poverty: Pre and Post Independent India.
In the pre-Independence period: Dadabai Naoroji was the first person to discuss the
concept of poverty line. He used the ‘Jail Cost of Living’ to calculate the poverty
Line.
He termed this consumption cost as ‘Jail cost of living’. As only adults stay in
jail, he divided the population into two parts:
He assumed that 1/3rd of total population consist of children. ½ of them
consumed very little, while the other half consumed half of the adult diet.
2/3rd population consisted of adults and they consume full diet.
Weighted Average of consumption of the three segments: The average
poverty line come out to be three-fourth of the adult jail cost of living.
1/6 X Nil Diet + 1/6 x Half-Diet + 2/3 x Full Diet
1/6 X 0 + 1 /6 + 1 / 2 + 2/3 x1=3/4.
In Post-independent India there have been several attempts to identify the
no.of poor in the country.
In 1962, the planning commission formed a study group.
In 1979, “Task Force on Projections of Minimum Needs and Effective
Consumption Demand’ was formed.
In 1989, an ‘expert Group’ was constituted for the same purpose.
Concept of Poverty Line.
Poverty Line is a cut-off point on the line of distribution, which usually divides the
population of the country as poor and non-poor.
The concept of poverty line is used to measure the extent of poverty in a country.
People having income below the poverty line are called “Poor” and
People with income above poverty line are called “Non-poor”.
Poverty line tries to capture the socially acceptable minimum living standards, which
the society tries to fulfil.
Determination of Poverty Line.
In India, ‘Monthly Per capita Expenditure or MPCE” method is used to determine the
poverty line. According to this method, monetary value of the minimum calorie
intake is calculated.
Minimum Calorie intake: 2400 calories per person per day rural area
2100 calories per person per day in urban area
Monetary value of min. calorie intake. MPCE in 2011-12 is worked out to be
Rs.816 per person in rural area
Rs.1,000 per person in urban areas.
Poverty Line Divides the poor from the Non-poor.
Categorising Poverty.
1. Chronic poor: It includes people who are always poor and those who are
usually poor.
2. Transient poor: it may be classified as churning poor (Who regularly move
in and out of poverty) and occasionally poor (who are rich most of the time
and poor sometimes)
3. Non-poor. They are never poor.