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1 AGENDA Thurs 5/12 & Fri 5/13 Global Economics CIA Factbook Hungry Planet HW: Study for Final Exam EC #3 DUE Mon 5/23 Final Reflection Essay DUE: P1-5/26; P2-5/25 Textbook return: P1-5/24; P2-5/25
2 Classifications of countries: (new and old) Industrialized (developed)- a country with a relatively high per-capita GDP or GNPexamples US, UK, Canada, Italy, Germany, Japan Industrializing a country in the process of developing and industrializing examples: South Africa Least industrialized (Less- developed )- a country with a relatively low per-capita GDP or GNP- examples: Ghana, Haiti, North Korea, Vietnam, Ethiopia
3 International Poverty line Traditionally, poverty has been measured by the lack of a minimum income (or consumption level) necessary to meet basic needs. Measuring poverty on a global scale requires establishing a uniform poverty level across extremely divergent economies, which can result in only rough comparisons. The World Bank defined the international poverty line as U.S. $1 and $2 per day Purchasing Power Parity (PPP), which adjusts for differences in the prices of goods and services between countries. In 2008, the World Bank came out with a revised figure of $1.25 at 2005 purchasing-power parity (PPP). In October 2015, the amount was increased to $1.90 and $2.50 USD. The $1 per day level is generally used for the least developed countries, primarily African; the $2-per-day level is used for middle income economies such as those of East Asia and Latin America.
4 Determining the line Find total cost of all the essential resources that an average human adult consumes in one year (needs-based approach in that an assessment is made of the minimum expenditure needed to maintain a tolerable life). This was the original basis of the poverty line in the United States, whose calculation was simplified to be based solely on the cost of food and is updated each year. In developing countries, the most expensive of these resources is typically the cost of housing. Economists thus pay particular attention to the real estate market and housing prices because of their strong influence on the poverty threshold. Individual factors are often used to account for various circumstances, such as whether one is a parent, elderly, a child, married, etc. The poverty threshold may be adjusted each year. The poverty threshold is useful as an economic tool with which to measure such people and consider socioeconomic reforms such as welfare and unemployment insurance to reduce poverty.
5 Percentage population living on less than $1.25 per day 2009
6 Percentage population living on less than $2 per day 2009
7
8 The 2015 poverty threshold was measured according to the Department of Health and Human Services Poverty Guidelines which are illustrated in the table below. Persons in Family Unit 48 Contiguous States and D.C. Alaska Hawaii 1 $11,770 $14,720 $13,550 2 $15,930 $19,920 $18,330 3 $20,090 $25,120 $23,110 4 $24,250 $30,320 $27,890 5 $28,410 $35,520 $32,670 6 $32,570 $40,720 $37,450 7 $36,730 $45,920 $42,230 8 $40,890 $51,120 $47,010 For each additional person, add $4,160 $5,200 $4,780
9 Poor or Rich? By this measure, in 2005 there were 982 million people out of the developing world's 4.8 billion people living on $1 per day, while another 2.5 billion (40% of the world's population) were living on less than $2 per day. Currently, at least 80% of humanity lives on less than $10 a day. More than 80 percent of the world s population lives in countries where income differentials are widening. The poorest 40% of the world population accounted for 5% of global income. The richest 20% accounted for 75% of world income, and the richest 10% accounted for 54%.
10 Infant mortality Infant mortality rate- the number of children who die before their first birthday out of every 1,000 live births What is the United States infant mortality rate? How does the US rank in the world? #1, top 5? What countries are best or worst?
11 Answer
12 Hungry Planet
13 Do you see what I see? Analyze each photo using the following : 1. What country does the family live in? 2. What do you think the average weekly expenditure for food is in that country? 3. What observations can you make about the food items shown in the picture? 4. What suggestions/comments do you have about this family in regard to healthy lifestyles, budgeting, etc.? 5. Are you surprised by the actual food expenditure amount?
14 #1:Germany: The Melander family of Bargteheide Food expenditure for one week: Euros or $ USD
15 #2: United States: The Revis family of North Carolina Food expenditure for one week $ (Sure hope most American families eat more fresh fruits and vegetables and less junk food than this family.)
16 #3: Italy: The Manzo family of Sicily Food expenditure for one week: Euros or $ USD
17 #4: Poland: The Sobczynscy family of Konstancin-Jeziorna Food expenditure for one week: Zlotys or $ USD
18 #5: Mexico: The Casales family of Cuernavaca Food expenditure for one week: 1, Mexican Pesos or $ USD
19 #6: Egypt: The Ahmed family of Cairo Food expenditure for one week: Egyptian Pounds or $43.66 USD
20 #7: Ecuador: The Ayme family of Tingo Food expenditure for one week: $31.55 USD (does not have its own monetary unit)
21 #8: Bhutan: The Namgay family of Shingkhey Village Food expenditure for one week: ngultrum or $3.38 USD
22 #9: Chad: The Aboubakar family of Breidjing Camp Food expenditure for one week: 685 CFA Francs or $1.19 USD
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