Poverty-Growth-Inequality Triangle

In analysing the bases of the economy we must pay attention, first of all to people. As is explain in
the article of F.Bourguignon there is a dependency between the three main variables that causes, in
resultat the economic situation that we have today. These three variables are very general: poverty,
growth and inequality in distribution of the income. We can see the change in poverty level when is a
change distribution of income : more income is distributed or the existing income is allocated more
uniform, than this increase economic growth level and as a result the poverty decrease. A change in
distribution can be showed by a change in GINI indice. From another perspective a change in
agregate growth, also have the effect of change in the poverty, however a change in agregate level of
growth does not mean, necessarily, a big change in the distribution of the income, and here we can
observe that in reality in the countries are groups of the peoples that even that the country where the
live, is a developed one, they are still poor, because the increase in the level of growth don't always
mean a better distribution of income. The inequality is not only a result of the income distribution,
but also is a social result derived from the position of the group of people that we analyse, not all the
people have the chance to have profit from a better distribution of income, even that in official
perspective they can do this. On this effect the article does not paid attention, because how to do the
change must be done by the state authorities who know better the situation in the country, but this is
not a right approach, on my opinion, because the social position of a group of people, by meaning of
the psychological acceptance of these peoples by other peoples, the cultural features, the historical
perspective - all of these affect the possibilities of reducing the poverty. In the article we can find
example, statistical observations in countries how the change in the distribution or in the growth
affect the level of poverty (Brazil 1976-1996). The change can have also the condition of a social
conflict with violence like in Latin America and sub-Saharan Africa as it is explained in the article.
In order to achieve a good change it have to be modified both variables : the distribution of income
and the growth level. It is important to mention that the changes come very slow, it takes years to see
the effects, so is needed a long-term perspective in the actions and not only, because the situation can
be affected also by external factors like the a world crisis, or a catastrophe, like recent events in
Japan, so there is a risk . Another important issue is the Political Transition, the political situation in
the country or in the union, affect very much the economy, however there is also an inverse effect
that : the higher is the level of growth and better is the distribution, people tend to be more interested
in politics, so the dependency level increase. For the authorities of the countries or unions there are
more channels through which is possible to implement the change in distribution like : income
transfers, insurance(social protection) and others, but in order to use these channels it have to be full
filled some economic preconditions that are very difficult to achieve.

In my opinion, the change in the poverty level is a result of distribution of the income and the level of
growth, so in order to decrease the poverty, we have to implement a set of actions, that will have
effect not only the change in growth or in distribution but in both, and the responsibility for these
changes is not only on authorities, but also on us.

Dumitru Trifan, UW, 2011.