Policies Aimed At Alleviating Poverty
- The poverty cycle diagram (below) was introduced in the previous subtopic & helps to explain the causes of poverty
- Any policy that helps to break the poverty cycle at any point will help to improve the standards of living within a country
- Policies used to alleviate poverty include promoting economic growth, improving education, providing more generous state benefits, progressive taxation, & the establishment/increase of a national minimum wage
Policies which help to improve any factor in the diagram will help to alleviate poverty
How Different Policies Alleviate Poverty
Policy |
Explanation |
Impact on Poverty Cycle |
Promoting economic growth |
|
Higher growth → higher wages → better education/healthcare → better human capital → better productivity → higher income |
Improving education |
|
Higher education/skill levels → higher human capital → increased productivity → higher output → higher income |
More generous state benefits |
|
More benefits → higher wages → better education/healthcare → better human capital → better productivity → higher wages |
Progressive taxation |
|
Higher redistribution → better education/healthcare → better human capital → better productivity → higher income |
Establishment/increase of national minimum wage |
|
Higher wages → better education/healthcare → better human capital → better productivity → higher wages |