International Day for the Eradication of Poverty

Posted on Updated on

Saturday 17. October 2015 was the International Day for the Eradication of Poverty. Many experts believe that the UN Millennium Development Goals have not been achieved: in the Sub-Sahara region of Africa and other countries are still a lot of poverty, about 700 million people live on less than 1.90 dollar a day (World Bank) worldwide. China is a success story: through progressive liberalization and integration of world trade (Axel Dreher, a development economist at the University of Heidelberg), it has been achieved that only one (1) Chinese of ten (10) is undernourished today, – 25 years ago it was one of four. However, experts criticize the unilateral trade relations and that economic growth has been achieved at the expense of the environment and society: the Triple Bottom Line Approach (People, Planet,Profit) had too little consideration!  They point out that the SDGs (Sustainable Development Goals) may serve as a valuable framework and reference, but the implementation of the SDGs has to be executed by national politics (which is often incapable and corrupt). It requires reliable institutions, which can be trusted, Rules of Law, good environment and conditions for companies and investors, and the fight against corruption. Alejandro Cunat, economist at the University of Vienna, views the SDGs skeptical: it makes little sense to put developing countries a list of required measures in their hand, because it depends on the will and the interest of governments too. There are many influential stakeholders in developing countries (not only in Greece) who are interested only in the trade of importing than exporting because much higher profits can be achieved not taking care of the economic and unemployment situation. Success stories of Singapore, Taiwan, South Korea and China cannot be transferred without adaptations, but it can be learned from them. In October 2015 received the poverty researcher Angus Deaton the Nobel Prize. He regards himself as “someone who’s concerned with the poor of the world and how people behave, and what gives them a good life.” Angus Deaton has enhanced this understanding by linking detailed individual choices and aggregate outcomes, his research has helped transform the fields of microeconomics, macroeconomics, and Development Economics. -> https://en.wikipedia.org/wiki/Angus_Deaton

Roland Leithenmayr, VfV

Source: Simon Moser, Erfolgsgeschichte mit 700 Millionen Ausnahmen, der Standard / Economics Sat. / So., 17/18. Oktober 2015

What are the causes of the poverty reduction worldwide ?

Posted on Updated on

Ban Ki-moon, Secretary-General of the United Nations, announced in July 2015 very proud the achievement of MDG 1 (Millennium Development Goal 1): While in the year 1990, 50% of the world’s population earned less than US$ 1.25 a day in 2015 it was only 14%.

What are the actual forces which generated this high reduction of poverty: Was it the free market, the globalization (opening up of markets, reduction of tariffs, privatization, the inflow of foreign capital), or was it the the lifting of the ban on ownership, or all of them. The critics of capitalism are more likely to demonstrate the adverse effects of the forces of capitalism. Even if those above mentioned processes were radical, painful and partly unfair it brought ultimately economic growth and prosperity to ermerging and developing countries.

Roland Leithenmayr VfV