...THE RICH, THE POOR AND THE OKAY

A common index of measuring inequality of income distribution is the gini index. The gini index developed by Italian statistician Corrado Gini ranges from 0 to 1. Where 0 expresses perfect equality of income and a value of 1 depicts that a single person possesses all the available income. It could also be rated in percentile yet having the same interpretation as above Country Gini Index % (year) South Africa 63.14(2009) Nigeria 48.83(2010) Cote d'Ivoire 41.5(2008) Rwanda 50.8(2011) Senegal 40.3(2011) Gini Index by Nations: Source World Bank States Gini Index (2010) Lagos 0.3719 F.C.T 0.5116 Bauchi 0.3348 Rivers 0.4614 Imo 0.4250 Sokoto 0.3550 Source National Bureau of Statistics Nigeria Poverty Profile The orthodox measures of capturing poverty include the Head count Index, Human Development index, the physical quality of life index, the misery or discomfort index, absolute poverty measurement index, subjective poverty measurement approach. In Nigeria for example the Nigeria Living Standard Survey, a survey unit of the National Bureau of Statistics and initiated by the World Bank makes use of four (4) basic poverty measurement approaches of which the first has gained dominance in measuring poverty in Nigeria  Relative Poverty Measurement approach  Absolute (Objective) or Food Energy In-take measurement approach  Subjective Poverty Measurement approach and  Dollar per day measurement approach The relative measure of poverty divides population into three categories; the Extreme poor, the moderate poor and the Non Poor. Taking a national consumption expenditure and deflating it with an index deflator i.e. consumer price index (CPI), households having expenditures more than two-thirds of the household per capita expenditure are considered non-poor. A household having less than two-third but greater than one-third is seen as moderate poor, while those having less than one third are the extreme poor. The objective measure involves food and non-food expenditure, with more emphasis on the former. It attempts to measure the energy intake (calories) of about 40% of the poor and the amount spent. The subjective poverty measure is based on self-approach, looking at what members feel or think about themselves and finally the dollar per day approach makes use of the current exchange rate; here families unable to spend a dollar per day on consumption are regarded as poor. However we must realize that the relative poverty measure has gained strong grounds in Nigerian poverty surveys. I would like my fellow readers to ponder on these questions. Which of these factors is a major contributor to income inequality in Nigeria? a. Oil b. Ignorance c. Corruption to be continued……

THE RICH, THE POOR AND THE OKAY (1)

The rich, the poor and the okay (1) Back in school, one of my teachers, Professor Oni once said “the concept poverty is multi-dimensional, not having a specific definition.” The late Professor Aboyade in 1972 at a guest lecture described poverty “as an elephant that could be easily recognized than defined”. Economists unanimously view poverty as a state of low income and consumption. One fact which has been noticed pertaining to world nations is that rapid economic growth has failed to eliminate widespread absolute poverty due to its failure in exhibiting a trickle-down effect to the average man. Nigeria has been averaging growth of 6% and I ask if that has reduced the percentage of the poor in the country? A new concept of growth has indeed been proposed, tagged as “inclusive growth” to capture the need for economic growth to be effected on the average poor. Analysts have emphasized that the poor distribution of the wealth obtained from the country has further contributed to the widening income gap between the rich and the poor. Psychologists on the other hand see poverty from the angle of deprivations. This therefore infer us to believe that one could be physically poor, mentally poor, materially poor, and emotionally poor and so on. However we must identify five (5) key forms of deprivation viz.: a)Economic: Economic resources have been said to be scarce, therefore the allocation of scarce resources in various sets of economies ensures that a certain proportion of individuals are left with minimal amount of certain resource. This proportion would be minimal in command economies; b)Political: in this era of democracy, every individual is entitled to certain rights and such rights does not preclude his choice in the field of politics which involves one’s enfranchisement; c)Social: denial of social life with emphasis on association and relations; d)Physical: denial of access to basic social goods such as education, health, shelter and food; and e)Cultural: unappreciativeness of one’s culture and way of life.