Poverty is about denial of opportunities and fulfilment of human potential. Poverty and inequality are closely related, and inequality appears to have been on the rise worldwide in recent decades at both national and international levels. More than 80 percent of the world’s population lives in countries where income differentials are widening. The poorest 40 percent of the world’s population account for only 5 percent of global income. On the other hand, the richest 20 percent account for 75 percent of world income, according to the United Nations Development Programme. Poverty is the principal cause of hunger and under nourishment. According to most recent estimates of the Food & Agriculture Organization of the United Nations (FAO, 2009), the number of hungry people world wide has reached 963 million, or roughly 15 percent of the estimated world population. This represents an increase of 142 million over the figure for 1990‐92. Poverty essentially consists of two elements, a narrowly‐defined “income” poverty and a broader concept of “human” poverty (referred to as the poverty of opportunities by late Dr. Mahbub ul Haq). Income poverty is defined as the lack of necessities for minimum material wellbeing determined by the national poverty line. Human poverty means the denial of choices and opportunities for a tolerable life in all economic and social aspects. Three poverty measures are commonly used; a) Head count ratio (HCR): the proportion of population below the national or international poverty line as the case may be. b) Poverty gap ratio; a measure of poverty obtained by multiplying the head count by the average relative distance at which the poor are from the poverty line. c) Severity of poverty measure; where the weight given to each poor person is proportional to the ...
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