Poverty is general scarcity or the state of one who lacks a certain amount of material possessions or money. It is a multifaceted concept, which includes social, economic, and political elements. Poverty in Pakistan has fallen dramatically, independent bodies supported estimates of a considerable fall in the statistic by the 2007-08 fiscal year, when it was estimated that 17.2% of the total population lived below the poverty line

1. Poverty
Types of Poverty
Facts and figures
Effects of Poverty
Measures of Poverty
Poverty in Pakistan

2. Poverty is the deprivation of food, shelter, money and clothing when
people can’t satisfy their basic needs. Poverty can be understood simply
as a lack of money or more broadly in terms of barriers to everyday
human life.
Poverty

3. According to Mobile Orshansky who developed the poverty
measurements used by the U.S. government, “ Poor is to be deprived of
those goods, services and pleasures which others around us take for
granted.”
According to David Kurten , Poverty also involve social disintegration
and environmental degradation which he describe as forming the
threefold human crisis in the world today.

4. Poverty is the other economic problem facing most of the nations in
the world.
This is based on the national definition as well as the international
standards of US $1/day/person and US $2/day/person. Lately poverty
definition is changed to US $4/day/person.

5. (1) Absolute Poverty : (Destitution) It refers to the state of severe
deprivation of basic human needs.
(2) Relative Poverty : It is defined contextually as Economic Inequality
in location or society in which people live.

6. A graph on which the cumulative
percentage of total national income (or
some other variable) is plotted against
the cumulative percentage of the
corresponding population (ranked in
increasing size of share). The extent to
which the curve sags below a straight
diagonal line indicates the degree of
inequality of distribution.

7. It is often used to represent income distribution, where it shows for the
bottom x% of households, what percentage y% of the total income they
have. The percentage of households is plotted on the x-axis, the
percentage of income on the y-axis.
 It can also be used to show distribution of assets. In such use, many
economists consider it to be a measure of social inequality. It was
developed by Max O. Lorenz in 1905 for representing inequality of the
wealth distribution.

9.  The world bank estimated that ,
1) Around 1.29 billion people were in absolute poverty in 2008.
2) About 400 million people in absolute poverty in India and 173 million
people in china.
3) Sub-saharan Africa at 47% had the highest incidence rate of absolute
poverty in 2008.
4) Between 1990 and 2010, about 663 million people moved above the
absolute poverty level.

10. 5) Every year 11 million children living in poverty die before their 5th
birthday.
6) 1.02 billion people go to bed hungry every night.

11. The World bank’s “Voice of the poor” , based on research with over
20,000 poor people in 23 countries, identifies a range of factors which
poor people identify as part of poverty are :
(1) Precious livelihoods
(2) Excluded location
(3) Physical limitation

12. (4) Lack of security
(5) Problems in social relationship
(6) Weak community organization
(7) Limited capabilities

13. The poverty threshold or poverty line is the minimum level of income
deemed adequate in a given country.
In practice, like the definition of poverty, the official or common
understanding of the poverty line is significantly higher in developed
countries than in developing countries.
The common international poverty line has in the past been roughly $1 a
day. In 2008, the World Bank came out with a revised figure of $1.25 at 2005
purchasing-power parity (PPP).

14. Determining the poverty line is usually done by finding the total cost of
all the essential resources that an average human adult consumes in one
year.
The largest of these expenses is typically the rent required to live in an
apartment, so historically, economists have paid particular attention to
the real estate market and housing prices as a strong poverty line
affector.

15. The Gini coefficient is usually defined mathematically based on the
Lorenz curve , which plots the proportion of the total income of the
population (y axis) that is cumulatively earned by the bottom x% of the
population. The line at 45 degrees thus represents perfect equality of
incomes.

17. The Gini coefficient can then be thought of as the ratio of the area that
lies between the line of equality and the Lorenz curve over the total
area under the line of equality .

18. The Gini coefficient can theoretically range from 0 to 1; it is sometimes
expressed as a percentage ranging between 0 and 100. In practice, both
extreme values are not quite reached.
A low Gini coefficient indicates a more equal distribution, with 0
corresponding to complete equality, while higher Gini coefficients
indicate more unequal distribution, with 1 corresponding to complete
inequality.

19. Effects of poverty also be causes and creating a “Poverty cycle” operating
across multiple levels, individual, national, global.
(1) Health : one third of deaths are due to poverty related causes. .
Those living in poverty suffer from life expectancy.
According to the World Health Organization, hunger and malnutrition are the
single gravest threats to the world's public health and malnutrition is by far the
biggest contributor to child mortality , present in half of all cases.

20. Almost 90% of maternal deaths during childbirth occur in Asia and
sub-Saharan Africa, compared to less than 1% in the developed world.

21. (2) Hunger : Rises in the living cost making poor people less able to afford
items. Poor people spend most of the portion of their budget on to food
than richer person.

22. (3) Education : Poor children are suffering from hunger,
irritability,headache,viral infection, colds. It is safe to state that children
who live at or below the poverty level will have far less success
educationally than children who live above the poverty line.
• Poor children have a great deal less healthcare and this ultimately results in
many absences from the academic year.
• Additionally, poor children are much more likely to suffer from hunger,
fatigue, irritability, headaches, ear infections, flu, and colds. These illnesses
could potentially restrict a child or student's focus and concentration.

23. (4) Housing : Poverty increases the risk of homelessness. Slum-
dwellers, who make up a third of the world's urban population, live in a
poverty no better, if not worse, than rural people, who are the traditional
focus of the poverty in the developing world , according to a report by the
United Nations. There are over 100 million street children worldwide.

24. (5) Violence : According to the reports, many women become victims of
trafficking. The most common form of which is Prostitution as a mean
of survival and economic desperation.
• Deterioration of living conditions can often compel children to
abandon school in order to contribute family income.
E.g. Slavery and Human trafficking.

26. There are Various measures of the extent of poverty .
The head count index.
The poverty gap index.
The squared poverty gap (poverty severity) index.

27. • The most widely used measure is the headcount index.
• It simply measures the proportion of the population that is counted as
poor.
Head count index = No. of poor / Total no. of population

28. • It does not take the intensity of poverty into account.
• Survey does not indicate how poor the poor are, and hence does not
change if people below the poverty line become poorer.

29. The most common method of measuring and reporting poverty is the
headcount ratio, given as the percentage of population that is below the
poverty line.
 One of the undesirable features of the headcount ratio is that it ignores the
depth of poverty; if the poor becomes poorer, the headcount index does not
change.
Poverty gap index provides a clearer perspective on the depth of poverty.

30. Poverty gap index is a measure of the intensity of poverty. It is defined as
the average poverty gap in the population as a proportion of the poverty
line.
The poverty gap index is an improvement over the poverty measure
headcount ratio which simply counts all the people below a poverty line, in
a given population, and considers them equally poor.
 Poverty gap index estimates the depth of poverty by considering how far,
on the average, the poor are from that poverty line.

31. By definition, poverty gap index is a percentage between 0 and 100%.
 Sometimes it is reported as a fraction, between 0 and 1. A theoretical
value of zero implies that all the extremely poor people are exactly at
the poverty line.
 A theoretical value of 100% implies all the extremely poor people have
zero income. In some literature, poverty gap index is reported as while
headcount ratio is reported as .

32. Squared poverty gap index, also known poverty severity index or , is
related to poverty gap index.
 It is calculated by averaging the square of poverty gap ratio. By
squaring each poverty gap data, the measure puts more weight the
further a poor person's observed income falls below the poverty line.
 The squared poverty gap index is one form of a weighted sum of
poverty gaps, with the weight proportionate to the poverty gap.

33.  Increasing supply of basic needs.
 Increasing supply of food and other goods.
 Increasing supply of healthcare and education, water and energy
utilities.
 Removing constraints on govt. services
 Reversing brain drains.
 Controlling overpopulation.
 Increasing personal income.

35. Using 2013-14 data, of Pakistan population income the poverty
headcount ratio comes out to be 29.5pc of the population. In monetary
terms, poverty line stands at Rs3,030 per adult equivalent per month.

36. A STUDY on poverty has brought Pakistan face to face with a reality
that it will find hard to accept: Every third Pakistani is caught in the
‘poor’ bracket which means about 58.7 million out of a total population
of 180 million subsist below the poverty line. This includes:
 16% of Balochistan
 33% of Sindh
 32% of Khyber Pakhtunkhwa
 19% of Punjab

37. 32%
19%16%
33%
Percentage by Population
KPK 32%
Punjab 19%
Baluchistan 16%
Sindh 33%

39. Since the beginning, poverty has been a major issue for the economy of
Pakistan.
Like any other economy there have been many ups and downs in the
economy of Pakistan.
Over the years, sometimes there have been increase and decrease in the
poverty of Pakistan.
Data about the poverty of Pakistan that is available shows that the
poverty ratio that was almost 90% in 1987 is 66% in 2013.

40. Government Bad Policies
Corruption
Inflation
Smuggling
Overpopulation
Unemployment
Lack of education
Law and order situation
Foreign Investment

41. It is estimated that around 5 Crore per month is spent on the security of
Prime Minister and the President.
Monthly expense of 1 minister = 30 Lac, Monthly expense of
96 minister = 28 Crore80 Lac

42. CORRUPTION
 It’s a condition when People forget about mortality,
and don’t care about the fact if money is being earned
by fair means
 Only one relationship that is exists in society is
money. One has to pay a heavy cost to get his right.
 Institutions have failed to provide justice to common
Citizens.

43. Poverty in Pakistan is increasing because of general rise in prices of all
products in Pakistan
Hence, it decreases purchasing power of people earning low
earnings/Wages/Salaries.

44. Pakistan was recently facing the shortage of sugar and wheat due to the
smuggling these items to neighboring countries.
Pakistan is the 7th largest wheat producing, it’s consumption was 20
Million ton and produced 23 million ton recently.
Similarly Pakistan is the 4th largest
sugarcane producing country.

45.  International Labor Organization defines, poverty occurs when people
are without jobs and they have actively sought work.
Unemployment rate in 2009 was 7.40 which is doubled in 2010, the
current rate is 15.20%.
When people are unemployed they consume the resources but are
unable to
contribute in overall economy,
which results in poverty.

46. Terrorist attacks create uncertainty in stock markets and people
earnings from stock markets are getting loss due to which the whole
country faces uncertain increase in commodity prices.
Local Industries, Firms are unable
to sign agreements with foreign
investors due to prevailing law
and order situation.

47.  Increasing the supply of basic needs.
 Increasing personal income.

48. Food and other goods
Agricultural technologies such as nitrogen fertilizers and pesticides
have dramatically reduced food shortages by boosting yields.
Mass production of goods in places such as rapidly industrializing
China has made things inexpensive and accessible to many who were
otherwise too poor to afford them.

49. Health care and education
Desirable actions such as enrolling children in school or receiving
vaccinations can be encouraged.

50. Removing constraints on govt. services
Basic services should be provided without corruption.
Low taxes

51. Controlling overpopulation
Overpopulation and lack of access to birth control leads to population
increase to exceed food production and other resources.
 Empowering women with better education and more control of their
lives makes them more successful in bringing down rapid population
growth through family planning.

52. Income grants
A guaranteed minimum income ensures that every citizen will be able
to purchase a desired level of basic needs.
 Income grants (subsidies) are argued to be vastly more efficient in
extending basic needs to the poor.

53. Economic freedoms
Easy terms and conditions for the people to open a business.
Favorable circumstances.
Governments should provide essential infrastructure.

54. Financial Services
Another form of aid is microloans, made famous by the Gramean Bank,
where small amounts of money are loaned to farmers or villages,
mostly women, who can then obtain physical capital to increase their
economic rewards.

55. Cultural factors to productivity
 Cultural factors, such as discrimination of various kinds, can negatively affect
productivity such as age discrimination, stereotyping, gender
discrimination, racial discrimination, and caste discrimination.
 Max Weber and the Modernization Theory suggest that cultural values could
affect economic success.

56. Poverty will never end unless there are real solutions to end it; solutions
based on economic justice and political changes.
1. The full equality between men and women in public as well as private
areas of life, a worldwide minimum wage of $20 per day and the end of
child labor under the age of 16 with the creation of a subsidy for
scholarship.
2. The guarantee of shelter, healthcare, education, food and drinking
water as basic human rights that must be provided free to all.

57. 3- A total redistribution of idle lands to landless farmers and the
imposition of a 50% cap on arable land devoted to products for export per
country, with the creation of a worldwide subsidy for organic agriculture.
4- Government should create better policies to tackle this problem and
learn from our past. There should be policies for providing jobs to
unemployed people.