First, he explains that the so-called “poverty trap” is not the cause of poor nations’ slow or nonexistent growth, despite the claims of foreign aid organizations. Easterly argues instead that bad governments and their interference with their economies may be the reason for many countries’ slow growth. To fix this problem, many aid organizations attempt to assist poor nations by restructuring their economic institutions from the top down. However, Easterly claims that these attempts have shown to be futile time and time again. He argues that this is because restructuring an entire economy from the top down is almost always bound to fail.
The high cost of loan service put burden on debtor’s ability to repay. Another problem can be a lack of business opportunities, because it is very hard for small businesses to survive in the market. However, the other fact that microcredit affects positively on social well-being of population demonstrates that it can be an efficient solvency of a problem of poverty if the policies and customer services in the microfinance system will be
Many know The Great Depression hit America at this time, leaving more Americans without money, however the supply had not changed, there was still the same technology and resources and it was clear to Keynesian Economic that a self adjusting economy would not cut it anymore. This theory is the idea that demand determines the amount goods supplied. The Keynesian Economists believed aggregate demand is influenced by both the public and private sectors; meaning they believed the government had a role in the influence of economic choices. The belief that the velocity was unstable and that the market would not return to potential output on its own was a large argument they had. As aggregate demand affects the supply (production, employment and inflation) they saw it as the government's role to build it back up using monetary and fiscal policies.
Apart from this, health is human capital in itself and can be utilized in producing other forms of human capital (Bleakley, 2010). According to him, if an individual is unhealthy in his early life, it interferes severely with his psychological and cognitive development, which ultimately depresses the formation of human capital. During the 1960s, when policy makers and economists all over the world were apprehensive over the nutritional deficiency faced by the poor, especially in the developing economies, the Institute of Nutrition of Central America and Panama (INCAP), performed a number of trials and arrived at the conclusion that the nutritional intake of a child has a major role to play in the child’s mental development and hence on his adult human capital outcome
Any developments or changes introduced have revolved around creating incentives to take up work and removing the deterrents around employment. Changes to existing programmes or the implementation of new ones, at times often lack consideration for the overall objectives of the social welfare system as they are sometimes a result of the reactions of several pressure groups. Programmes such as back to work allowance and back to education allowance have been successful and have helped a selected few back into employment. In spite of these improvements, the government still have yet to remove the barriers to people who receive social assistance payments that will enable him/her to return to work, which in turn may lead them to become socially excluded or fall into poverty. This could be seen as a step back from the Poor Law policy as by removing the outdoor relief this encouraged independency by motivating one to seek employment and it discouraged dependency on the state.
An important breakthrough in the past decades at home and abroad is on understanding of poverty as the single income of poor from steering multidimensional poverty. However, research on exactly how the Multidimensional Poverty Index with the actual selection of countries and regions affects the right index and weight is still not deep enough. Multidimensional Poverty Index was developed by UNDP and
Muhammad Yunus a famous economist, in his book “banker to the poor” focuses primarily on credit programs targeted to benefit poor which resulted in better opportunities for them. The main focus was to provide loans in small amount to poor people to improve their living standards and become self employed. Author also describes the inherent weaknesses in socioeconomic structures, which refrains poor people to come out of poverty. The thought of movement to America as a path for the poor to enhance their lives remains a capable symbol. Numerous liberals specifically stay hypnotized by this wistful bit of energetic mythology, washed in a fluffy sparkle transmitting from Ellis Island.
Following the introduction of the provision of the micro-financing loans to the women, more economic development have been recorded in the country. The business activities that are performed by the women of Afghanistan have led to the economic development of the country. It has led to the process of eradicating poverty in the country. It is through the businesses operated by the women that they are in a position to provide for some of the basic needs that are required by their families. The families are in a position to access the vital needs that are required to enable them to grow healthier than in the
Microfinance institutions are giving the opportunity to low people with low resources to show their creativity, innovation and idea and they will finance to become successful. SBP and government of Pakistan are also working to generate more funds for the microfinance institution as the poverty is main economic indicator and government also knows that they cannot achieve the low unemployment by just only public enterprise and large public and private company, there is need of huge small business to decreases the unemployment rate which result in increased consumption and then economic growth . So entrepreneurs are important for every economy and without entrepreneurs country cannot achieve high growth rate and especially in Pakistan country where business community fear to invest in their own country so the SBP need to provide good schemes by microfinance to the poor people so they can become entrepreneur and contribute for the
Development slowed because of the economic mismanagement and corruption under President Marcos regime, which imposes martial law that suspended civil rights and forces to have military rule. During his era he focused on improving the economy of the Philippines but the government increases their spending particularly on infrastructures. Lavish and wasteful spending and aggressive borrowing of money cause a massive government debt even it has a times of positive growth lately it fails to improve its local industries. The Philippines attempt on becoming an industrialized nation throughout the year 1950s. For continuing the development of the labor intensive export manufacturing, economic policies consider on giving a little amount of incentive for it.