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Jaime Mogollón Michilot

Economic Student,

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How we can reduce poverty and inequality in developing countries?

I'm from Peru. A developing country. We are having a good perfomance in our economy, but we have to face a non resolved problem. One to 3 peruvians live on poverty conditions (see the link for wikipedia information bit.ly/17qs4Rw) .
How we can face this problem?


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    Oct 2 2013: Jaime, During the period of 1968 - 1975 the elected official made a radical change to communism and attempted income redistribution, creation of a large state owned sector, and socialism with resulted in entitlements that could not be supported. Despite the failure at all levels, these reforms were not reversed until the 1990's. New leadership ended price controls, protectionism, restrictions on foreign direct investment, and most state ownership of companies. Reforms have permitted sustained economic growth since 1993. Recent economic growth has been fueled by macroeconomic stability, improved terms of trade, and rising investment and consumption.

    Addressing poverty and inequality: 75.9% live in urban areas and 24.1% in rural areas. The life styles are most dramatically demonstrated when side by side comparison of the urban VS rural live are compared. I would be safe in saying that the farmers who have lived off the land for many generations and bartered for goods and needs would not know how poor they are. You say 1 in 3 ... Wikipedia says only 9.8% live in poverty. Certainly not one third by their accounting. We make a big deal of a whole village that only takes in $50 in currency in a year. There is no record of anyone dying from hunger ... no power no problem .... no cloths no problem .... no car no problem. Why must we try to change everything we come in contact with ... In that society if I had ten cows I might be "wealthy" and much respected .... but some social worker comes along and says you live in poverty.

    There will always be a top and a bottom. In the USA the "do gooders" say we must help the poor ... we build housing complexes and they tear them up ... the government enact entitlements and they refuse to work because they are getting everything for free ... so why work. We now face generational welfare families.

    Be cautious of social programs and welfare handouts. There is no such thing as a "free lunch" ...
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      Oct 2 2013: Mr. Winner.
      I can see you have a deep knowledge about peruvian economic history. You've made a good resumen of peruvian economic phases. And yes, peruvian GDP is in growing since 1993, if financial crisis is not considered, although we have an feedstock-based economy.

      Actually, Wikipedia says that in Peru the poverty level dropped from 36.2% in 2008 to 25.8% in the past year. We cand find similar numbers on peruvian statistics institute called INEI (you can see more in spanish and english here http://www.inei.gob.pe/).

      I think poverty is not about what we can buy with some money. I think poverty goes beyond and it is about oportunities to be better, about indivudual elections, health care, education and inclusive human rights. In my country kids in peruvian andes froze to death (see this link in spanish bit.ly/NQ8HmW). The poverty have several edges.

      We don't need people that bring us charity, we need more skills that the only way we can acquire them is through quality education.We have to teach how to catch fishes.

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        Oct 2 2013: I can see the confusion here ... in the last sentence in Wikipedia (Peru) under economics it states "According to 2010 data, 31.3% of its total population is poor, including 9.8% that lives in poverty.[63]"

        However in the third paragraph of the opening comments it states: " It is a developing country with a high Human Development Index score and a poverty level around 28.7 percent."

        Same article ... different "facts".

        The first one is based on Human Development Index (HDI). "the HDI can be viewed as an index of “potential” human development that could be achieved if there were no inequality)".[3]

        The second one is based on the average income and a line drawn at which point defines the difference between poor and poverty.

        As a economic student I am sure you are aware of the Pakistani economist Mahbub ul Haq and this formula for HDI. So the 28.7% "fact" is not a fact at all. Just a what if .... (HDI) is a composite statistic of life expectancy, education, and income indices used to rank countries into four tiers of human development as stated in your paragraph three.

        I admire education ... but in this case we do not need a formula ... we need real people on the ground with a heart, soul, and some common sense to compare apples to apples and the real world.

        Then you can begin to plan for a working solution.

        Again thanks. I wish you well. Bob.

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