Global Stratification Questions we want to answer • How do we look at poverty differently when it is on a global scale? • How bad is global inequality • How did it get to this point? How did this global inequality happen? • What are the consequences of global inequality today? Poverty • Huge, worldwide, inequality gap – The richest 20% receives at least 150 times more income than the poorest 20% – The top 20% consumes 86% of the world’s goods and services – Poorest fifth consumes about 1% of world’s goods and services Types of Poverty • Subjective – compare against expectations and perceptions • Relative – cannot afford basic necessities, but can maintain a minimal standard of living • Absolute – cannot secure the most basic needs of life; this brings life-threatening malnutrition and disease • Isbister (1995) defines poverty is the inability to make choices Global Inequality • The three richest people in the world have wealth that exceeds the combined economic output of the 47 least-developed nations • The world’s richest 200 people together have more money than the combined income of the lowest 40% (2.4 billion people) • About half of the world’s people live on less than $2 a day (the World Bank’s definition of poverty Global Inequality • Girls and women are disproportionately disadvantaged. Women represent 2/3 of the world’s illiterate people and 3/5 of its poor. • Stemming from cultural practices, food rations are often given to fathers and sons before daughters and mothers, resulting in greater malnourishment and disease. Why is there global inequality? • Geographic isolation, climate, and natural resources • Power Gini Coefficient • Used to measure income inequality • Number between 0 and 1 • 0 means perfect equality (all resources are evenly distributed) • 1 means perfect inequality (one person has control of all resources) Gini Coefficient Australia = .352 China = .447 France = .327 Germany = .283 India = .325 Japan = .249 Mexico = .546 UK = .360 US = .408 Theories of Global Inequality • How does the first world explain global inequality? • Modernization theory • Focuses on deficiencies in poor countries – absence of democratic institutions, of capital, technology and initiative and speculate how to repair deficiencies • Global wealth and poverty are linked to industrialization Modernization Theory • Rostow’s four stages of Economic Development (1960) – Traditional society – no change – Preconditions for take-off – traditional society challenged – Take-off – belief in individualism, capitalism – Drive to technological maturity – High Mass Consumption Modernization Theory • Polarizes “tradition” and “modernity” • Looks at global economic integration especially by the International Monetary Find and the World Bank Theories of Global Inequality • How does the third world explain global inequality? • Dependency theory • Third World countries are exploited by first world countries • Economic growth in advanced countries created third world poverty in its wake Dependency theory • 16th Century capitalism developed as a global system • Workers produced raw material for export to rich countries • After independence, countries borrowed money from the First World in the 50s and 60s during the Cold War Dependency theory • Money was given to dictators that went to the military or the dictator’s family • Oil in OPEC countries went to Western Banks and was loaned to Third World countries • Interest rates on the loans went up/OPEC crisis made cost of oil go up Dependency theory • Countries went into debt to pay off loans and used this money to pay for food for their populations • Success of capitalism depends on labor earnings of third world staying low • Third World does not have economic independence; they give up more than they get back World Systems Theory • Capitalism is truly a global system that is held together with economic ties • Three types of nations – Core – Semi-Peripheral – Peripheral New International Division of Labor • Commodity production is split into fragments that can be assigned to the part of the world that can provide the most profitable combination of capital and labor Promises not Kept • People’s labor would be used for their own progress • Cooperation between rich and poor nations for economic development Consequences of Poverty Food and Hunger • World’s agriculture produces enough food for 6 billion people • 1.1 billion people are undernourished and underweight due to uneven food distribution Consequences of Poverty Sickness and Disease • Chronic malnutrition: – Results in shorter life expectancies – Results in vitamin deficiencies – Produces low levels of energy Consequences of Poverty HIV and AIDS • Pandemic: a worldwide epidemic • Seventy percent of people with HIV live in sub-Saharan Africa • Expensive drugs are unavailable to most people in these countries Consequences of Poverty New Slavery • Not usually a lifelong condition • Sometimes people become a slave by a choice forced by extreme poverty • Prostitution, domestic workers, plantation workers • 27 million slaves in the world today