Poverty is something that happens around the world.

Poverty
is a state of being in which a person
cannot take care of them so financially and they are not an eight ball to live
a standard lifestyle of well-being. Many people live in poverty it is hard to
say but poverty probably will not be able to be illuminated
by our world’s economy. But what exactly defines poverty, is it the
social status of a person, is it the lack of income, is it the lack of good
health, or is it the lack of education. Poverty can be correlated with race,
age, and family composition which have been described at the American society
for years. There are many consequences of poverty some of which I will talk
about in this paper. If a person is not educated it is unlikely for them to get
employed they would have to go under serious job training to even be considered
for a position. Poverty has decreased around the world after the industrial
revolution. Because of this production has reduced
the cost of goods which makes them available to society. There have been
advancements in agriculture which helps provide food production for the world.
The main area of poverty has been in East Asia south Asia and Africa since the
mid-1990s. The inequality in income distribution sits at the forefront of the
poverty rate.

Poverty
is important to international economics because it is something that happens
around the world. Having inequality of income constantly affects the
demographics of society. According to Deaton, the labor market is a good
starting point for incomes. Most families get their incomes from what people
earn, so the jobs and wages exert a profound effect on family incomes. But the
labor market is one of the only forces shaping family incomes. Many people for
example homemakers, retirees, children, the unemployed, and the disabled, have
no earnings and depend on other members of the families, on pensions, or on the
government. This is what shapes the demographics
of poverty.

Incomes
can differ greatly between those at the top and those at the bottom of the
economic ladder. There is a gap between rich and poor because of income
inequality. There are three main categories to fall in: the rich, the
struggling poor, and for the expiring and worried middle class. Labor earnings
make up about two-thirds of the total income in the Unites States economy. This wage determines the total income that is
distributed among various members of society (Mankiw 414). Most of income distribution allows people to be
in the middle class. That is assuming that a person working it’s not just
making minimum-wage but they are making a little more than minimum wage  to
cover the required cost-of-living and do not depend on the government for aid.
In many cases, people of poverty rely on
the government. The government issues funding for food, housing, and
transportation for people suffering or living in poverty but they will only get
the bare minimum.

Poverty
comes with depression and lack of self-value and motivation. Many people in
poverty become alcohol and substance abusers have less access to education, poor
living conditions, and higher disease
rates. These levels of poverty are likely caused by societal inequalities, and
often cause higher crime rates in communities affected by poverty. Some people
at this level poverty fall below the poverty line. The poverty line is an
absolute level of income set by the federal government for each family size
below which a family is deemed to be in poverty. The poverty line is set by the
federal government at roughly three times the cost of providing an adequate diet
(Mankiw 417). This line is adjusted every year to make the necessary changes so that it can provide about
the same amount of help for peoples families..
The report provides an estimate of the number of people that are poor; the
percentage of people living below the poverty level; the poverty distribution
by age, sex, ethnicity, location, etc.; and the level of income inequality ( Investopedia). The poverty line in the United States
was created in 1963 by Miley Orshansky, an economist working for the Social
Security Administration. She calculated
how much a family of 4, two adults and two children, would have to spend on
food just to get by. Her next step she multiplied that amount by three, the
normal family spent about a third of its income on food. She came up with $3165.
In August 1969, the figure was officially adopted as the United States poverty
line and has been an  unchanged since(Deaton) .

The
American poverty line has become what is known as an absolute top-of-the-line:
one of the stipulated a fixed amount of money needed to escape poverty,
updating only for changes in prices. It does not depend on what the other
people get, nor on the prevailing standards in the economy. An absolute line
makes the most sense when there is a well-defined basket of goods that people
need to survive the property line is they’re just the cost of the basket and
search in mind that does not need to be
updated over time except to account for
price changes so that the basket is always affordable

 

 

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