Poverty
Poverty
The 1990 issue of the World Development Report focused on poverty. In spite
of the rapid growth in the world over the past three decades, especially in
income, consumption, and some broader measures of well-being, over 1 bil-
lion people in the developing countries live in poverty. The poverty line is
only $370 per year. Even on broader issues of well-being conditions are sig-
nificantly worse in the developing countries than they are in the high-income
countries. For example, life expectancy in Sub-Saharan Africa is only 50
years, whereas it is 80 years in Japan.
Table 2.5 identifies some broad measures for poverty in the developing
world. Africa and developing Asia are significantly worse off than Latin
America. The mortality and life-expectancy rates are not significantly differ-
ent, but the gross numbers and percentage of the population below the pov-
erty line are much worse.
The World Bank emphasizes two strategies for improving the lot of the
poor:
1. Efficient labor-intensive growth based on appropriate market incentive,
physical infrastructure, institutions, and technological innovation.
2. Adequate provision of social services, including r^maiy-eehjcatiorl^iTask
health care, and familyplanmng services.
The first strategy implies a significant role for the MNE. Because of the
low wage rates in the developing countries, there should be plenty of oppor-
tunities for low-end manufacturing as education and skill levels improve.
Governments may assist in infrastructure development and provide incen-
tives for firms to locate in their countries in order to encourage economic
development.
The 1990 issue of the World Development Report focused on poverty. In spite
of the rapid growth in the world over the past three decades, especially in
income, consumption, and some broader measures of well-being, over 1 bil-
lion people in the developing countries live in poverty. The poverty line is
only $370 per year. Even on broader issues of well-being conditions are sig-
nificantly worse in the developing countries than they are in the high-income
countries. For example, life expectancy in Sub-Saharan Africa is only 50
years, whereas it is 80 years in Japan.
Table 2.5 identifies some broad measures for poverty in the developing
world. Africa and developing Asia are significantly worse off than Latin
America. The mortality and life-expectancy rates are not significantly differ-
ent, but the gross numbers and percentage of the population below the pov-
erty line are much worse.
The World Bank emphasizes two strategies for improving the lot of the
poor:
1. Efficient labor-intensive growth based on appropriate market incentive,
physical infrastructure, institutions, and technological innovation.
2. Adequate provision of social services, including r^maiy-eehjcatiorl^iTask
health care, and familyplanmng services.
The first strategy implies a significant role for the MNE. Because of the
low wage rates in the developing countries, there should be plenty of oppor-
tunities for low-end manufacturing as education and skill levels improve.
Governments may assist in infrastructure development and provide incen-
tives for firms to locate in their countries in order to encourage economic
development.
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