Tải bản đầy đủ

Ecomomics evelopment 10th y p todaro and smith chapter 05

Chapter 5
Poverty,
Inequality, and
Development

Copyright © 2009 Pearson Addison-Wesley. All rights reserved.


Measuring Income Distribution
Relative Income Share:
• The ratio of the highest 20% to lowest 40% of
the population
• The higher the ratio, the greater is income
inequality

Copyright © 2009 Pearson AddisonWesley. All rights reserved.

5-2


Typical Size Distribution of Personal Income


Copyright © 2009 Pearson AddisonWesley. All rights reserved.

5-3


Lorenz Curve of Income Distribution
• Depicting:
quintile percentage of population vs.
cumulative percentage of income received
• The closer the Lorenz curve to the line of equality, the
better is the size distribution of income

Copyright © 2009 Pearson AddisonWesley. All rights reserved.

5-4


Lorenz Curve of Income Distribution
Data for the United States in 2000:
Quintile

% Income

% Cumulative Income

Lowest 20%

3.6

3.6

Second 20%

8.9

12.5

Third 20%


14.9

27.4

Fourth 20%

23.0

50.4

Richest 20%

49.6

100.0

Copyright © 2009 Pearson AddisonWesley. All rights reserved.

5-5


Lorenz Curve of Income Distribution

Copyright © 2009 Pearson AddisonWesley. All rights reserved.

5-6


Lorenz Curve of Income Distribution

The greater the curvature of the Lorenz Curve, the greater is the
Copyright
© 2009inequality
Pearson Addisondegree of income

Wesley. All rights reserved.

5-7


Improved Income Distribution

Copyright © 2009 Pearson AddisonWesley. All rights reserved.

5-8


Worsened Income Distribution

Copyright © 2009 Pearson AddisonWesley. All rights reserved.

5-9


Crossing Lorenz Curves

Copyright © 2009 Pearson AddisonWesley. All rights reserved.

5-10


The Gini Coefficient

Copyright © 2009 Pearson AddisonWesley. All rights reserved.

5-11


The Gini Coefficient
0 < The Gini Coefficient < 1
• 0.41 for U.S.
• 0.30 for Ethiopia
• 0.57 for Brazil
• Gini Coefficient is higher for the OPEC and
Middle-income countries than Low-income
countries
Copyright © 2009 Pearson AddisonWesley. All rights reserved.

5-12


The Gini Coefficient
Income inequality had had a tendency to
increase.
1960
LDCs

0.544 0.602

Low income countries

0.407 0.450

1980

Middle-income countries 0.603 0.569
The OPEC

0.575 0.612

Copyright © 2009 Pearson AddisonWesley. All rights reserved.

5-13


Income Distribution Measures

Copyright © 2009 Pearson AddisonWesley. All rights reserved.

5-14


Income Inequality

Copyright © 2009 Pearson AddisonWesley. All rights reserved.

5-15


Functional Income Distribution
• Assume a traditional economy in which labor is the
only variable input (capital and land are fixed): Output
= Wages + Profits
• Functional income distribution = Wages as a
percentage of Profits
• The higher the ratio, the greater is income equality

Copyright © 2009 Pearson AddisonWesley. All rights reserved.

5-16


Functional Income Distribution

Copyright © 2009 Pearson AddisonWesley. All rights reserved.

5-17


Poverty Gap
Average percent of income shortfall below
the poverty line. Over 10.5% in LDCs
• Latin America & Caribbean: about 9%
• Middle East and North Africa: about 1%
• Sub-Saharan Africa: about 15%
• South Asia: 13%
• China, East Asia & Pacific: 8%
Copyright © 2009 Pearson AddisonWesley. All rights reserved.

5-18


Measuring Poverty Gap
• Poverty and income inequality depend on
type of economic, political and institutional
arrangements according to which rising
national incomes are distributed among
broad segments of a population
• A middle-income country may have a higher
poverty rate and poverty gap than a lowincome country (South Africa vs. Sri Lanka)
Copyright © 2009 Pearson AddisonWesley. All rights reserved.

5-19


Measuring Total Poverty Gap

Copyright © 2009 Pearson AddisonWesley. All rights reserved.

5-20


Growth and Distribution
The “Inverted-U” Kuznets Curve
• Income inequality increases during the early stages of
growth
• Income equality increases during a later stage of
growth with redistribution of income and wealth

Copyright © 2009 Pearson AddisonWesley. All rights reserved.

5-21


The Kuznets Curve

Copyright © 2009 Pearson AddisonWesley. All rights reserved.

5-22


Evidence on Kuznets Curve
• Cross country evidence supports the hypothesis
• Time series data show some countries have
been able to grow and improve income
distribution at the same time

Copyright © 2009 Pearson AddisonWesley. All rights reserved.

5-23


Kuznets Curve in Latin American

Copyright © 2009 Pearson AddisonWesley. All rights reserved.

5-24


Income Inequality Across Time

Copyright © 2009 Pearson AddisonWesley. All rights reserved.

5-25


Tài liệu bạn tìm kiếm đã sẵn sàng tải về

Tải bản đầy đủ ngay

×