scholarly journals THE RICH AND THE POOR IN A SIMPLE MODEL OF GROWTH AND DISTRIBUTION

2016 ◽  
Vol 20 (7) ◽  
pp. 1934-1952 ◽  
Author(s):  
Kirill Borissov
Keyword(s):  
Economic Growth ◽  
Steady State ◽  
Simple Model ◽  
Disposable Income ◽  
State Equilibrium ◽  
Positional Concerns ◽  
The Poor ◽  
The Rich ◽  
Intertemporal Equilibrium ◽  
Unique Steady State

We consider a model of economic growth with altruistic agents who care about their consumption and the disposable income of their offspring. The agents' consumption and the offspring's disposable income are subject to positional concerns. We show that, if the measure of consumption-related positional concerns is sufficiently low and/or the measure of offspring-related positional concerns is sufficiently high, then there is a unique steady-state equilibrium, which is characterized by perfect income and wealth equality, and all intertemporal equilibira converge to it. Otherwise, in steady-state equilibria, the population splits into two classes, the rich and the poor; under this scenario, in any intertemporal equilibrium, all capital is eventually owned by the households that were the wealthiest from the outset and all other households become poor.

scholarly journals Pengaruh Zakat, Infak, dan Sedekah terhadap Pertumbuhan Ekonomi Indonesia

2020 ◽  
Vol 6 (1) ◽  
pp. 101
Author(s):  
Dewi Purwanti
Keyword(s):  
Economic Growth ◽  
Regression Analysis ◽  
Basic Needs ◽  
Poor People ◽  
Panel Regression ◽  
Distribution Of Wealth ◽  
The Poor ◽  
The Rich ◽  
Positive Effect

Zakat is obligatory for all Muslims while infaq and alms are sunah. Zakat, infaq, and alms (ZIS) make distribution of wealth from the rich to the poor people. If the poor people are able to fulfill their basic needs, they can work well and contribute positively to the economy in various sectors. Zakat, infaq, and alms are expected to be one of the alternative policies to increase economic growth. However, to find out whether zakat, infaq, and alms have succeeded in positively contribute to economic growth, research is needed to prove the existence of the influence of zakat, infaq and alms in Indonesia. The purpose of this study is to determine the effect of zakat, infaq, and alms on the economy. This study uses a panel regression analysis with driscoll and kraay standars errors. The results of this study showed that zakat, infaq, and alms have positive effect on Indonesia's economic growth.

scholarly journals Making Business Work for Development: Issues for Small to Medium Enterprises

2021 ◽  
Author(s):  
◽  
Paul Thompson
Keyword(s):  
Economic Growth ◽  
Developing Countries ◽  
Poverty Alleviation ◽  
Global Economy ◽  
Poverty Reduction ◽  
Significant Proportion ◽  
Global Market ◽  
The Poor ◽  
The Rich ◽  
Medium Enterprises

<p>This thesis examines the question of whether business can be made to work for development. Can the standards that are used to measure development projects be applied to the outcomes of business ventures in developing countries? Proponents of neoliberal economic globalisation claim that economic growth is, by definition, good for the poor, and that the opening of global markets gives unprecedented opportunities for poverty reduction. 'Aid for Trade' is now a significant proportion of ODA funding. This is aid that is directed at assisting developing countries to be able to enter the global market. The claim is that the removal of trade barriers and the facilitation of smooth trade processes will be the key to achieving the MDG targets for poverty alleviation. Literature however suggests that such claims are much exaggerated, and that the global market does not automatically work to benefit the poor. Even where good rates of growth are achieved in a country, the poor are left behind, with widening income gaps between the rich and poor. This thesis examines these issues before investigating the concept of 'pro-poor business'. Economic growth can be structured to have positive benefits for the poor. It does not happen automatically, but it can be intentionally built into economic growth structures. There are some basic and fairly simple steps which all business could adopt to assist in poverty alleviation. Beyond this there are business ventures that are proactive in targeting the needs of poor communities. The thesis looks at case studies of six businesses started by expatriate entrepreneurs in six Asian countries. The businesses are investigated by a qualitative study that uses an emailed questionnaire followed up by further email and phone discussions. The businesses have been chosen to illustrate the possibilities over a range of types and sizes of business, and the degree to which they are intentional in targeting specific poverty issues. The businesses are asked questions both about their business structures and also about the extent to which they achieve development oriented goals. Issues faced by the businesses in this melding of business and development concerns are examined. The conclusion is that there are opportunities arising from globalisation that can be taken and shaped to enable the poor to become participants in the global economy.</p>

The Politics of Poverty

Social Change ◽  
2019 ◽  
Vol 49 (2) ◽  
pp. 232-240
Author(s):  
Digvijay Kumar
Keyword(s):  
Economic Growth ◽  
Poverty Reduction ◽  
Poverty Line ◽  
Poverty Rate ◽  
Social Dimensions ◽  
Welfare Policies ◽  
The Poor ◽  
The Social ◽  
The Rich ◽  
Poverty Levels

The reduction in the official poverty rate seen in relation with increasing morbidity status, a mammoth income gap between the rich and the poor, ambiguous methodology followed to calculate Below Poverty Line Census and government policies on poverty reduction tends to question the whole poverty line debate. The official commitment to higher economic growth may reflect booming economic growth but it also has led to a large gap between the rich and the poor in both regional and social dimensions. To look into the causes and ameliorate poverty levels, various committees and policies have identified poverty levels. Using different criteria and methods, they still have failed to look at the social and political aspects. It is politics that has engulfed the whole discourse over universalisation of social welfare policies as some sort of justification behind the nation’s fiscal deficit and subsidy constraint-related questions.

scholarly journals POVERTY AND ECONOMIC GROWTH: A REVIEW

2016 ◽  
Vol 22 (1) ◽  
pp. 156-175 ◽  
Author(s):  
Marinko ŠKARE ◽  
Romina PRŽIKLAS DRUŽETA
Keyword(s):  
Economic Growth ◽  
Poverty Reduction ◽  
Relevant Literature ◽  
Causal Link ◽  
Poor Growth ◽  
Research Issues ◽  
The Poor ◽  
The Rich ◽  
Similar Growth

The objective of this paper is to review and attempt a synthesis of the relevant literature on growth versus poverty, and to analyze the causal link between the two phenomena. Research issues that drive our study are: Does economic growth tend to “raise all boats” as Kuznets (1955) pointed out? What is the role of the pattern of growth in the process of development? Which factor must we consider in designing appropriate pro-poor growth policies? This paper finds considerable variation in the poverty–reducing effectiveness of growth across time and authors. Also, our analysis speaks in favour of the fact that as growth occurs poverty reduces, no matter the level of inequality. Identically, similar growth pattern has different effects on poverty reduction. We conclude that growth is good for poverty alleviation but it is not enough. The extent to which growth reduces poverty depends upon how we measure poverty, and upon absorptive capacity of the poor, the pace and pattern of growth. In times when the rich are getting richer and the poor are getting poorer, “trickle-down” effect becomes a scenario that need to be reviewed.

scholarly journals Do Inequality Measures Measure Inequality?

2018 ◽  
pp. 207-220
Author(s):  
Gary S. Fields
Keyword(s):  
Economic Growth ◽  
Final Section ◽  
Inequality Measurement ◽  
Inequality Decomposition ◽  
Inequality Measures ◽  
The Poor ◽  
Absolute Inequality ◽  
The Rich ◽  
The Relationship

In the literature, much attention has been paid to a number of aspects of inequality including the distinction between relative and absolute inequality, axiomatization of inequality, the Lorenz criterion for inequality comparisons, properties of various inequality measures, and inequality decomposition. In no way do I wish to argue with the main results derived in these areas. Rather, my purpose here is to add to the theory of inequality measurement by dealing with one aspect of inequality which has been largely ignored by economists and by others. This is the question of how inequality changes – in particular, whether it increases, decreases, or remains unchanged – when income grows in specified ways. The balance of this chapter deals with two distinct conceptual entities, “inequality” and “inequality measures.” The next section analyzes how “inequality” might be said to change under various types of economic growth and explores the foundations for alternative views. One approach in terms of “elitism of the rich” and “isolation of the poor” is then described. The following section looks into the behavior of “inequality measures” and the relationship between “inequality measures” and “inequality,” and a final section draws some conclusions.

scholarly journals Convergence of Russian Regions: Different Patterns for Poor, Middle and Rich

2021 ◽  
Vol 17 (4) ◽  
pp. 1151-1165
Author(s):  
O.A. Demidova ◽  
Keyword(s):  
Economic Growth ◽  
Mutual Influence ◽  
Spillover Effects ◽  
Spatial Development ◽  
Investment Risk ◽  
Equilibrium Path ◽  
Russian Regions ◽  
Factors Affecting ◽  
The Poor ◽  
The Rich

The Strategy of Spatial Development of the Russian Federation until 2025 aims at the economic growth acceleration and reduction of the intra-regional socio-economic differences. Therefore, the factors affecting the economic growth of regions, convergence of regions, spillover effects from the neighbouring regions are of importance. Russian regions are very different and do not converge to a unique equilibrium path. 80 Russian regions were divided into the groups of poor, middle and rich regions. Three main hypotheses were considered, based on the differences in the 1) convergence speed, 2) influence of the same factors, 3) different mutual influence of regions. They were tested using a modified spatially autoregressive model for the three groups using the Russian regional data for 2000–2017. Beta-convergence was found only for the middle and rich regions, the rate of convergence was higher in the rich regions. The poor regions did not grow faster than the other regions, confirming the relevance of the Strategy of Spatial Development. The similarities and differences were identified in the factors ensuring the economic growth of regions belonging to the three groups. The growth in all regions is stimulated by the regional economy openness. The growth of rich regions can be achieved by increasing the investment and reducing the investment risk. However, the investments in the poor and middle regions are not effective. The poor and middle regions receive positive spillovers from the growth of the neighbouring regions. It is possible to expect reduced differences in the living standards between the poor and rich regions.

scholarly journals ECONOMIC DEVELOPMENT

2019 ◽  
Author(s):  
Rani Rahayu Nengsih
Keyword(s):  
Economic Growth ◽  
Output Growth ◽  
Total Output ◽  
Development Indicators ◽  
The Poor ◽  
Long Run ◽  
Per Capita ◽  
The Rich ◽  
Distribution Of Income ◽  
Capita Output

Economic growth is the process of increasing per capita output in the long run. economic growth only discuss about how much output growth or how much gnp is received without questioning the largest source of contribution from the total output received. So it is not surprising if one of the development indicators cannot be used as a reflection of the distribution of income of a country. It is also not surprising, when a country experiences growth, the country will also face the problem of inequality in income distribution, so that the rich the richer the poor the poorer they become.

scholarly journals Is income inequality unjust? Perspectives from political philosophy

2011 ◽  
Vol 7 (2) ◽  
Author(s):  
Xavier Marquez
Keyword(s):  
Economic Growth ◽  
Political Philosophy ◽  
Income Inequality ◽  
Life Expectancy ◽  
Social Mobility ◽  
Relative Deprivation ◽  
The Poor ◽  
The Rich ◽  
Teenage Births ◽  
Rich Countries

Richard Wilkinson and Kate Pickett have argued recently (Wilkinson and Pickett, 2010) that income inequality produces many kinds of social and health problems in rich countries.1 High rates of infant mortality, teenage births, crime and obesity, educational under-achievement, low life expectancy, social mobility and many other social problems are worse, they claim, in more unequal societies. They further argue that these problems are caused not by absolute deprivation (poverty) but by relative deprivation, and that they are best addressed by compressing the income distribution, even if this means slowing or entirely stopping economic growth. Moreover, their argument has the further implication that more could be done for underprivileged groups in society by reducing the gap between the rich and the poor than by investing more resources in public services.

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