Income Distribution and Undernutrition

Text extracted from

The World Food Problem

Leathers & Foster, 2004

ttp://www.amazon.com/World-Food-Problem-Toward-Undernutrition/dp/1588266389

Poorest of the Poor

• Live in third world• Mostly landless• Work for others, menial

jobs• Poorly educated• Illiterate• Superstitious• Squatters who live in huts• Almost no food• Fragmented household• Debt to relatives or lendershttp://archives.zinester.com/60514/143124/232308_slum.JPG

Per capita incomes differ

• Democratic Republic Congo: $80/yr

• Switzerland: $38,330

• Average person in Switzerland makes 500X more than in Mozambique.

• If compute purchasing power parity, difference between richest and poorest countries is 80X

http://faculty.washington.edu/wgold/family%20on%20crinnenhorn.jpg

http://news.bbc.co.uk/media/images/38542000/jpg/_38542715_family300bbc.jpg

Purchasing Power Parity

2003

http://en.wikipedia.org/wiki/File:PPP2003.svg

Global Incomes

Distribution of World GNP (1989)

Human Development Index

• Measures quality of life• High HDI

– High income countries

• Low HDI– Low income countries

• HDI not perfectly correlated with income

http://bp0.blogger.com/_vxI-ox6Dacw/R0yJQ0c_8YI/AAAAAAAAAO4/jCG1CPQfBb0/s1600-h/HDI+map.JPG

Gini Coefficient

• Gini coefficient: – Based on area of crescent made by

Lorenz curve– measures inequity of wealth– = A/A+B

• Gini index = Gini coefficient x 100

• Lowest inequity is in Japan– Gini coefficient = .249

• Gini index = 24.9

– Richest 20% controls 35% of income

• Highest inequity is in Brazil– Gini index= 60.7– Richest 20% controls 64% of income

Global Gini Coefficients

http://upload.wikimedia.org/wikipedia/commons/thumb/a/aa/Gini_Coefficient_World_Human_Development_Report_2007-2008.png/800px-Gini_Coefficient_World_Human_Development_Report_2007-2008.png

Kuznets Curve

• As a country develops, rich must get richer first

• Therefore inequity will increase initially

• Later, inequity will drop as prosperity increases

Data from 75 countries

Wealthy out-compete poor for food

• Can outbid poor for food

• Also purchase more livestock– Herd becomes more

dependent on grain

– Price of grain is bid up

– Harder for the poor to buy grain

Overall inequity declining slowly

• Global Gini coefficients:– .67 in 1980

– .65 in 1990

– .63 in 2000

– .62 in 2005

(Bob Sutcliff, 2007)http://www.bbc.co.uk/radio4/today/gallery/media/poverty2.jpg

Extreme Inequity Increasing

Child Labor

• 250 million children work worldwide– 22% of workforce in Asia– 17% of workforce in Latin America– 1/3 of children in sub-Saharan Africa

• Jobs– Agriculture– Textiles– Maids and services– Construction and manufacturing– Prostitution

• Many sold into debt bondage– To pay parent’s debt or as collateral– Advance on wages

http://uzbekistan.neweurasia.net/wp-content/images/june-2007/01_02a.jpg

U.S. Poor are Wealthy

• Poverty income– $9,359/yr

• Person at poverty line in U.S.– has higher income than

80% of people in the world• 97% poor households in U.S.

have color TV

U.S. Middle Class Decline

http://i.qtau.com/shrinking-middle-class.png

U.S. Inequity increasing

• Gini coefficients:– 1968: 38.6:

– 1970: 39.4

– 1980: 40.3

– 1990: 42.2

– 2000: 46.2

– 2007: 47.0

http://www.visualizingeconomics.com/wp-content/uploads/us_income_inequal_5_15_2006.jpg

Rich in U.S. getting richer

http://online.wsj.com/public/resources/images/P1-AL265_COMPAR_20080420183003.gif

Hunger in the U.S.A.

• 36.3 million people live in households that experience hunger – or the risk of hunger – Includes 13 million children– More than one in ten

households in the United States (11.2 percent).

• 1/5 of U.S. food ends up in the landfill

• Source: Bread for the World Institute (2004)

http://www.endhunger.org/images/u_s_hunger.png

http://www.bendib.com/newones/2006/november/large/End%20of%20Hunger%20in%20US.jpg