Structural Factors: This perspective argues that the poverty trap is largely determined by external factors beyond individual control. These include:

• Historical factors: Colonialism, conflict, and other historical events have created lasting inequalities that perpetuate poverty.
• Global economic structures: Unfair trade agreements, debt burdens, and other aspects of the global economic system can disadvantage developing countries.
• Institutional weaknesses: Corruption, weak governance, and inadequate legal systems hinder economic development and trap people in poverty.
• Geographical factors: Landlocked countries, countries with harsh climates, and areas prone to natural disasters often face greater challenges in escaping poverty.

Individual Choices: This perspective argues that individual choices, such as educational attainment, work effort, and savings behavior, play a significant role in determining whether people escape poverty. It suggests that:

• Lack of motivation: Some individuals may lack the motivation to work hard or invest in their future, particularly if they perceive little opportunity for advancement.
• Poor decision-making: Individuals may make poor financial decisions that exacerbate their poverty.
• Limited skills: Lack of skills and education limits earning potential.

Evaluation: The reality is likely a combination of both structural factors and individual choices. Structural factors create the context in which individual choices are made. For example, even with strong motivation, individuals in countries with limited opportunities may struggle to escape poverty. Conversely, even in favorable conditions, poor choices can trap individuals in poverty. Example: In sub-Saharan Africa, structural factors such as conflict and weak governance have contributed to widespread poverty. However, individual choices, such as investing in education and starting businesses, can also play a role in escaping poverty. Example: The availability of microfinance has empowered many individuals in developing countries to start businesses and improve their livelihoods, demonstrating the importance of individual agency within a structural context.

Conclusion: While individual choices are important, they are often constrained by structural factors. Effective poverty reduction strategies must address both individual and structural issues to be successful. A purely individualistic approach is unlikely to be effective in breaking the poverty trap.

Governments employ a variety of policy options to tackle both absolute and relative poverty. These can be broadly categorized into:

Policies to address Absolute Poverty:

• Direct Welfare Provision: This involves providing direct financial assistance to those in need. Examples include:

  • Cash Transfers: Unconditional or conditional cash transfers provide a regular income to poor households. (e.g., Bolsa Familia in Brazil)
  • Food Assistance Programs: Food banks, school meals, and food stamps ensure access to basic nutrition. (e.g., SNAP in the US)
  • Housing Subsidies: Help low-income families afford adequate housing.

• Healthcare Access: Ensuring access to affordable healthcare is crucial. Examples include:

  • Universal Healthcare Systems: Provide healthcare to all citizens, regardless of income. (e.g., NHS in the UK)
  • Subsidized Healthcare: Reduce the cost of healthcare for low-income individuals.

• Education Initiatives: Investing in education can improve long-term earning potential. Examples include:

  • Free Education: Eliminating tuition fees and providing school supplies.
  • Scholarships and Grants: Support students from low-income families.

Policies to address Relative Poverty:

• Income Redistribution: This involves transferring income from the wealthy to the poor. Examples include:

  • Progressive Taxation: Higher earners pay a larger percentage of their income in taxes.
  • Social Security: Provides a safety net for the elderly, disabled, and unemployed.
  • Unemployment Benefits: Provide income support to those who have lost their jobs.

• Equal Opportunities Policies: These aim to remove barriers to social mobility. Examples include:

  • Anti-Discrimination Laws: Protect individuals from discrimination in employment and housing.
  • Affirmative Action: Policies designed to increase opportunities for disadvantaged groups.
  • Early Childhood Education: Provides disadvantaged children with a head start in life.

• Social Programs: These aim to address social exclusion and promote social inclusion. Examples include:

  • Community Services: Provide support and resources to local communities.
  • Job Training Programs: Help unemployed individuals acquire new skills.

The choice of policies will depend on the specific context and the priorities of the government. Often, a combination of policies is required to effectively address both absolute and relative poverty.

The statement that UBI would be the most effective way to address rising inequality in the 21st century is debatable. While UBI has the potential to reduce income inequality, its effectiveness compared to other policy options is a matter of ongoing debate.

Arguments for the statement:

• Direct Income Redistribution: UBI directly transfers income to those with lower incomes, reducing the gap between the rich and the poor.
• Addresses Structural Inequality: UBI can provide a safety net for those displaced by automation and other structural changes in the economy, mitigating the impact of inequality.
• Empowerment and Opportunity: UBI can empower individuals with greater economic security, allowing them to pursue education, training, or entrepreneurship, potentially leading to improved economic outcomes.

Arguments against the statement:

• Cost and Funding Challenges: The high cost of UBI could require significant tax increases, which might disproportionately affect higher-income earners, potentially exacerbating inequality in some ways.
• Limited Impact on Wealth Inequality: UBI primarily addresses income inequality. It may have a limited impact on wealth inequality, which is a major driver of overall inequality.
• Potential for Inflation: If not managed carefully, UBI could lead to inflation, which could disproportionately hurt low-income earners.
• Alternative Policies: Other policies, such as progressive taxation, increased minimum wages, and improved access to education and healthcare, may be more effective in addressing inequality.

Conclusion: While UBI has the potential to reduce income inequality, it is not a guaranteed solution. Its effectiveness depends on its design, funding, and the broader policy context. A combination of policies, including UBI and other measures to address structural inequality, may be necessary to effectively tackle the challenge of rising inequality.