Achieving Inclusive Growth - Tackle Inequality and Poverty ( 1695 )

COUNTRY NAME: International

Achieving Inclusive Growth: Tackle Inequality & Poverty

Intersectional Economic Development: Closing the Economic Divide Mildew

The inclusive growth model in development holds that economic growth should not be at the expense of certain groups of people within the economy especially the disadvantaged ones. Unlike models of growth that seem to purely focus on increasing the size of the economy, this model focuses on the economy growing with every sector benefiting such that all the stakeholders benefit and none is left behind. It aims to mitigate disparity in earnings, curtail suffering on account of poverty, and allow people to pursue their life goals with relative ease.

This is particularly important in the context of this paper in which we investigate the understanding of the notion of inclusive growth and its relevance with narrowing the income gap and tackling poverty in general. The paper will also look into the possible measures and action plans that different governments and institutions may take in order to enhance their inclusive growth.

Economic Growth Dynasties and Its Relation to Closing the Income Inequality Gap

Income inequality is a global problem that affects such a large population around the globe that at least the concept of inclusive growth is able to target these populations as well with the focus on low to moderate income individuals. Rather than pure economic indicators such as levels of GDP or growth rates inclusive growth focuses on sustained level of economic development in conjunction to the social fabric strengthening.

In a number of developing nations, economic growth has not resulted in poverty alleviation or inequality reduction, therefore the significance of inclusive growth can not be overstated. In turn, it has resulted in a situation where large sections of the population have remained mired in poverty while the benefits of growth have, more often than not, been enjoyed by the few. This scenario breeds social discontent, political violence, and retards socio-economic progress.

Tenets of Inclusive Growth:

1.     Resource and Opportunity Availability: Providing equal access to growth enablers such as education, healthcare services, and job opportunities to all.

2.     Growth of the Economy: Broadening the base of the economy, especially women, ethnic minorities, and disadvantaged rural populations.

3.     Growth Structure: Formulating strategies that prevent the benefits of economic growth from being concentrated in one class or poverty cycle.

4.     Financial Assistance: Providing social safety nets, social security measures, insurance, and unemployment compensation to the at-risk population, to enable them to avoid poverty.

Tackling Income More Evenly Distributed Across Society

Income inequality within a certain society is highly unpopular and economically efficient, again this inequality proves to exist regardless of the growing GDP of that specific country. This consequently leads to the exclusion of a certain group economically or leading to instability within the economy itself. And thus the topic of income redistribution should always remain an important one as high barring inequality hinders societies growth across the board.

Main Drivers of Income Inequality:

1.     Investing & Learning Gap: Without the presence of education and investing almost all laborers start their career at minimum wage jobs or lower creating and stretching the inequality further.

2.     Revolutionary Advancements: The era of automation has officially taken over, leaving a wide selection of traditional jobs, largely affecting low income employees as well as areas targeted towards automation.

3.     Interconnectedness: Interconnectedness is to a certain degree detrimental to low-income countries, namely the fact that interconnectedness has opened doors of new markets but it has by hand greatly increased the stratification between low skilled workers and high skilled workers.

4.     Circulation of Wealth: Interconnectedness is to a certain degree detrimental to low-income countries and thus economic policies have on several occasions encouraged the wealthy into hoarding all the capital instead of allowing it to circulate.

Approaches for Remedying Income Inequality:

1.     An Appropriate Step Forward: The creation of progressive taxation is an ideal step forward into making sure those who can share and contribute to the economy are able to do so, thus diminishing economic inequalities.

2.     Educating and Training: Investing in people through proper education and vocational training is important for being proficient in a knowledge-based economy and mitigating the discrimination gaps.

3.     Improving healthcare services: Every person should be able to have access to proper health services in order to remain fit and active which will enable them to earn more and maintain economic equality.

4.     Creating Jobs: There should be an emphasis on job creation for the low-income earners in the marginalized groups through investments, entrepreneurship, and industrialization policies.

5.     Social Safety Nets: Building protection systems or enhancing existing welfare systems such as unemployment, healthcare, pensions, and disability can alleviate the negative effects discrimination has on the neglected people.

Poverty Alleviation and Inclusive Growth

Among the most significant threats facing humanity today, poverty should be given priority, primarily in developing economies. This is why there are gaps within the continent as there is growth of some nations and struggling of others. While there has been a tremendous success to the reduction of poverty as this lies to almost 10 percent around the world, inclusive growth is the way out of poverty.

Connecting Universal Inclusion and Poverty Reduction:

Inclusionary growth transforms the poor, moving them from being a concerned populace to people that have the ability to attain social security and basic employment rights through active livelihood opportunities which can help pull them over the poverty line. It also allows the poor to advance to the level concerning doing something meaningful rather than just doing activities that are limited to their mere existence.

The impact of inclusive growth is suffering in the short term but enjoys the long-term as a major contributor to tackling the poverty trap. When the underprivileged people have education, healthcare and self-respect with work they have the capacity to lift themselves and their families above the poverty line and also strengthen the economy through their contributions. There arises the demand of vices to where is deployment on economic expansion and suppression of destitution.

Major Strategies for Poverty Alleviation through Economic Integration:

1.     Equitable Opportunity to Learn and for Health: If poor families can get good education and health care today, it will give them the opportunity to become productive in society and also uplift families from poverty.

2.     Focusing on Development of Villages: The situation is troubled in rural America as violist around 40% of the globe’s impoverished civilians are placed in these areas and are unemployed with no access to basic facilities. Therefore strategies regarding the provision of education and aids in modifying the geography of agriculture focusing on rural construction are commendable.

3.     Microfinance and Entrepreneurship: Investing in microloans, providing entrepreneurship education and offering business support helps poor communities become self employed, earn income and create new employment opportunities within their societies.

4.     Inclusive Financial Systems: Providing low-income families with access to savings, insurance and loans can assist these households to mitigate risks, accumulate savings and manage investments.

Importance of Governments, Corporates, and International Entities

The need to promote comprehensive structural transformation calls for combined action of governments, corporations and international agencies. Though governments are the ones implementing policies to promote social welfare and equal economic growth, businesses can contribute significantly by practicing inclusive business models that benefit all stakeholders.

Government Policies for Inclusive Growth:

However, in terms of the structural policies required to achieve growth enhancement, while there are significant levels of efforts, there is also a need for stressing policies to deiphone, man neglect, inequality and low levels of poverty.

Business Contributions:

Business responsibilities will have to include also promotion of social responsibility so that inclusive practices on decent wages, ethical sourcing, and constructive return to communities are the integral part of business. Economic engagement opportunities can also be created through providing training and development for disadvantaged workers.

International Organizations and Development Agencies:

International organizations such as the United Nations, World Bank and International Labour Organization (ILO) can assist countries in applying area-growth strategies with the provision of capital, skilled manpower and policies formulation.

It is nearly impossible to talk about the issues of developing countries without touching the topic of inclusive growth. Inclusive growth at its core aims to reduce income disparity and poverty by creating an environment that allows the most marginalized members of society to contribute to the economy. No doubt, levels of poverty and inequality are significant problems, but they are not insurmountable — with the right policies, interventions and partnerships, it is possible to promote more inclusive, equitable development that benefits all people.

Finally, all-inclusive expansion helps poor people as well as the stability and resilience of whole societies. When everybody gets a chance to succeed the economy becomes stronger, and the social fabric is uplifted – making a better tomorrow for all.