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What is the difference between absolute and relative poverty?
Relative Poverty differs on the level of poverty in particular countries.
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What is the rule of thumb for the Lorenz Curve?
The further the bulge downward, the greater the degree of inequality
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What is the GINI Coefficient formula?
Area A/(Area A + area B)
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How do you determine the GINI Coefficient with grouped data?
The width of a rectangle is the width of the interval. The height of a rectangle is the average of the percentage of income at the two interval boundaries.
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What are 4 reasons to measure poverty?
- to keep the poor on the agenda
- Second, one needs to be able to identify the poor
- Third, to monitor and evaluate projects and policy interventions that are geared towards the poor.
- to evaluate the effectiveness of institutions whose goal is to help the poor.
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What does the Supplemental Poverty Measure (SPM) take into account?
- governmental benefits
- necessary expenses (eg. Taxes)
- adds unrelated people that share resources (ex. foster and unmarried partners)
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What new thresholds does the SPM take into account?
- minimum level of basic needs
- geographic poverty thresholds
- adds benefits & subtracts expenses
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What are the three poverty measures?
- The headcount index (poverty rate) measures the proportion of the population that is poor.
- The poverty gap index measures the extent to which individuals fall below the poverty line (the poverty gaps) as a proportion of the poverty line.
- The poverty severity index (squared poverty gap) averages the squares of the poverty gaps relative to the poverty line.
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What does the formula IPAT mean?
Impact= Population*Affluence (GDP Per person)*Technology (units of impact per unit of GDP)
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To find the technology portion of an IPAT model, what formula would you put in?
=+C11/(E11*F11)
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How do you find the technology input reduction factor?
=+(Today-Future)/Today
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How do you calculate the width of a rectangle?
- =C7-C6
- Difference of upper and lower percent of population from Table A
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How do you calculate the width center?
Average of percentage of income at two interval boundaries
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How do you find the area of a rectangle?
[Area A height at center] * [width of rectangle]
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What is the STIRPAT formula and how is it interpreted?
ln(Impact) = a# + b1#*ln(P) + b2#*ln(A) + b3#*ln(T)
•b1# tells us how responsive Impact is to changes in Population, etc.
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Define Overall Inequality.
it compares different groups characterized by AGE, RACE, ETHNICITY or GENDER
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Define Income Inequality.
It compares the proportion of income of the POOR, RICH, and MIDDLE CLASS
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Define Absolute Inequality.
the measure of people with income below a certain level
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Define Relative Poverty.
people living with income below different levels depending on the country or area within a country
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Define Gini Coefficient
a measure of the income inequality of the residents of a country or region
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Define the Cost of Basic Needs Approach.
Approach to constructing a poverty line based on the cost of acquiring enough food for adequate nutrition, as well as other essentials such as clothing and shelter
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Define Subjective Poverty Line.
Approach to constructing a poverty line based on asking people what minimum income level is needed to make ends meet
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Define Absolute Poverty Line
A poverty line that remains fixed over time, being adjusted only for inflation
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Define Headcount Poverty Index.
it measures the proportion of the population that is poor
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Define Poverty Gap Index.
It measures the extent to which individuals fall below the poverty line (The Poverty Gap) as a proportion of the poverty line; the sum of these gaps measures the minimum cost of eliminating poverty
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Define Poverty severity index.
it averages the squares of the poverty gaps relative to the poverty line
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What are some regional level causes level of poverty?
- vulnerability to flooding or typhoons
- remoteness
- quality of governance
- property rights and their enforcement
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What are some community-level causes of poverty
- availability of infrastructure
- availability of services
- proximity to markets
- social relationships
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What are some Household and Individual characteristics contributing to poverty?
- demographic (household size, age structure, dependency ratio, gender of head)
- economic (employment status, hours worked, property owned)
- social (health and nutritional status, education, shelter)
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What are some groups of anti-poverty activities?
- fostering opportunity
- facility empowerment
- addressing income secutity
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What is the common sense understanding of resilience?
bounce-back
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What is the engineering, psychology and disaster studies definition of resilience?
a return to normalcy or return to equilibrium
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What is the complex adaptive systems analysis definition of resilience?
it emphasizes how much multiple elements interact to produce dynamic feedbacks making a system more or less adaptable, that is, resilient to stress (which is a process, not a state or characteristic)
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What is a scenario?
a set of reasonably plausible, but structurally different futures, due to external uncertainties or different policy options
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What is a baseline scenario?
the scenario most likely to occur if governmental intervention in the development process does not change
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What are basic/export/non-local industries?
industries that sell their goods and services outside the region
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What are service/local/non-export industries?
they sell their services inside the region
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What is the economic base multiplier?
the ratio of total employment to basic employment; tells how many total jobs are created from the addition of one basic job
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What is the Standard Industrial Code (SIC)?
a coding system for industries that codes all industries by a 4-digit code
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What is the North American Industrial Classification System (NAICS)?
a classification system for industries that codes industries by 6-digit codes at the highest level of detail; seen as a replacement for SIC
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What is the direct method of calculating base employment?
survey of local firms
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What is the sector assignment of calculating base employment?
- agriculture
- mining
- manufacturing
- federal government
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What do location quotients say about base employment?
All industries with location quotients above 1 are considered export industries
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What are the minimum requirements for base employment measurement?
LQ comparison to minimum sector employment in similar areas (Regression approach: predictive model for each sector)
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What is the constant share model?
it assumes that local employment will continue to receive its past share of regional, state, or national employment
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What is the shift share analysis theory?
It assumes local industries grow at the national growth rate, then at the same growth rate as their respective national industries; the remaining residual growth (or decline) is due to local factors, such as competitive advantage or disadvantage
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What is the location quotient?
the ratio of an industries proportion of the local economy to that of the national ecomony
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What is the shift share national growth component?
how much employment would have grown (or declined) if it equaled total national employment growth
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What is the Shift share industrial share component?
how much more or less (compared to national growth) employment would have grown (or declined) if it equaled national industry employment growth
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What is the shift share local shift component?
the remainder of local industry growth (or decline), often interpreted as local competitive advantage
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