Economic Inequalities
Geography: Edexcel A Level, topic 10.5.6
Economic Inequalities Because of Development Aid
Some economic inequalities have arisen because of development aid.
Top-down aid
- In some states that receive substantial development aid, economic inequalities have increased while in other states economic inequalities have decreased.
- It has been suggested that top-down aid has tended to increase economic polarisation, while bottom-up aid has done more for the poor in terms of access to basic services (safe water and proper sewage disposal), primary education and healthcare.
The Gini coefficient
- The Gini coefficient is a statistical measure that can be used to assess whether the distribution of income among individuals or households within an economy strays from a perfectly equal distribution.
- A decrease in the Gini coefficient for any country indicates a move towards a more even distribution of income.
The Objectives of Superpowers
Superpowers like the USA and China often use aid as a way to extend their foreign policies and gain influence.
Superpowers
- Superpowers (e.g. USA, China) are defined by great economic wealth, military strength, reliable access to resources and a dominant ideology.
- Superpowers also need to reinforce or enhance their global status.
Tactics of superpowers
- They can achieve more global status by securing strategic locations, future supplies of resources (food, energy, minerals and water) and making technological advances to maintain their global sphere of influence.
- Aid is often used as an extension of their foreign policies to achieve the above, though often with ‘strings attached’.
Military alliances
- Forming and maintaining military alliances are important aspects of this ‘benevolence’ as well as being examples of both ‘soft’ and ‘hard’ power.
- China maintains that it does not need to, nor want to, set up military alliances.
Test yourself on Economic Inequalities
What kind of aid has been said to increase economic polarisation?
What has bottom-up aid done for less well-off people?
What would a decrease in the Gini coefficient for a country mean?
What kind of alliances does China maintain it doesn't need or want?