Jan 2, 2014

REPORT: SOLVING WORLD POVERTY THROUGH MATHEMATICS (1)

By: Peter Akindele

“The test of a civilisation is the way that it cares for its helpless members.” –  Mohandas Ghandi
IN today’s modern society, it is clear that the world has become increasingly globalised and technologically advanced.
The extent, to which it is “civilised” however, is questionable.  If Ghandi’s definition of civilisation is correct and is to be followed then the modern world is far from civilised. Today, in spite of the numerous advancements in science and technology, it was estimated in 2008 that 22.4 per cent of the 6,700,000,000 people (1,500,000,000) on this planet lived below the poverty line as defined by the World Bank.  It is therefore essential that as a global society we seek to aid the large percentage of people who are living below the poverty line. This report will seek to explore how as we can use the various advancement in today’s society, particularly in the areas of mathematics and economics, to propose a system by which we may begin to seriously tackle the issue of world poverty.
Methodology  
In order to tackle the issue of world poverty it is imperative to first define poverty on an international scale.  The World Bank as of 2005 set the international poverty line as an income of $1.25 per day per person.  This is calculated by finding the minimum amount of money needed in order to buy the basic necessities for a human being.  This is what will be used in order to define world poverty in this report and therefore the problem which I am trying to tackle.  Therefore when this report makes use of the term “absolute poverty,” it refers to those people who are living on less than $1.25 a day. 
 As suggested above, the way in which this report aims to tackle world poverty will be focused on employment.  Although it is tempting to try and tackle world poverty with mass wealth redistribution it is clear that the problem of world poverty cannot be solved by a mere handing out of money to people below the poverty line.  It is a steady income that will allow people to live above the poverty line and it is therefore clear that the best way for this to happen is to create a system whereby employment could be assured for the vast majority of the population.  This report, however, does not assume that everyone is employable with the obvious examples of children and people that are severely disabled.  This report, therefore, is focusing on how to ensure the employment of all those who are in any way employable whilst also providing for those incapable of working.
  The next step in seeking to tackle the issue of world poverty is to acknowledge the diversity in the world and the differing circumstances that each country faces in seeking to tackle the problem of poverty.  Therefore, this report will not attempt to be a “one size fits all” solution; it will, however, through the use of two case studies, aim to show how governments may go about trying to tackle poverty in their own countries.  The diversity of the different countries in the world means that the most efficient way of tackling poverty is to have governments who are aware of their unique situations to eradicate absolute poverty in their own countries.  This, however, is not to suggest that these solutions are restricted to these particular countries.  It is the aim of the report to show methods of solving poverty that with a little adjustment for each country would be able to work for any country in the world.  For the purposes of this report, Nigeria and the United Kingdom will be used for a case study.  Nigeria has been used because it is a developing country with a relatively high population, fairly low GDP and its abundance of natural resources.  The United Kingdom on the other hand is a developed country with a high GDP with a relatively low population and a lack of many natural resources and has to a large extent eradicated absolute poverty.  
Data
In order to implement the model that will be suggested in this report, it is important to have a good grasp of the current economic climate of both of the countries in question.  Although there are many methods of assessing the economic health of a country, this report will make use of Gross Domestic Product (GDP) Purchasing Power Parity (PPP).  This has advantages over other measures such as GDP, since it accounts for the differences in the cost of living for differing countries.  Furthermore, the World Bank level of $1.25 is set according to PPP and, therefore, it is important that this is the primary way with which the economic health is measured.  However, it is important to note that GDP does not measure the individual wealth but rather the sum total value of everything produced and, therefore, it must be used in conjunction with the percentage of people said to be living under the $1.25 poverty line.  Below are the GDP PPP, GDP PPP per capita, population, unemployment rate and percentage of those living below the $1.25 poverty line threshold for both the UK and Nigeria.  This will give a good picture of the current economic state of both of these countries and what would need to be changed in order to solve the issue of poverty. The following data is taken from the World Bank website:
Country Nigeria United Kingdom
As can be seen from the above figures, there is a clear difference in the amount of revenue that is produced in each of these countries.  Furthermore, the 68 per cent of people living under the $1.25 threshold is especially alarming.  This makes it an extremely useful case study for studying how to solve world poverty as it is an especially extreme case.  As such the focus will be on Nigeria on this report.  The UK has been included so that it can be seen that absolute poverty, no matter how negligible, still exists in the most developed countries and is still of concern.  The data for an exact percentage of those living under £1.25 a day in the UK is unavailable; however it can be assumed that it is very low and at the most one per cent.

- To be continued
Reactions: