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What is the difference between absolute and relative poverty?
Absolute poverty and relative poverty are two distinct concepts used to measure economic deprivation. **Absolute poverty** refers to a fixed threshold of income or resources necessary to maintain basic living standards, such as food, shelter, and clothing. This threshold, often defined internationalRead more
Absolute poverty and relative poverty are two distinct concepts used to measure economic deprivation.
**Absolute poverty** refers to a fixed threshold of income or resources necessary to maintain basic living standards, such as food, shelter, and clothing. This threshold, often defined internationally as living on less than $1.90 per day (according to the World Bank), is constant over time and across different countries. It measures whether individuals have the minimum resources needed for physical survival. Absolute poverty is useful for assessing extreme poverty levels globally and identifying those who cannot meet fundamental needs.
**Relative poverty**, on the other hand, is context-specific and varies according to societal standards and economic conditions. It measures an individual’s or family’s income in relation to the average income or living standards of the surrounding community or country. For example, someone might be considered relatively poor if their income is below 50% of the median income in their society. Relative poverty highlights disparities within a society and the inability of individuals to participate fully in customary social activities due to financial constraints.
In summary, absolute poverty is about meeting basic survival needs, while relative poverty is about economic inequality and social inclusion within a particular society. Both concepts are important for understanding and addressing different aspects of poverty.
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