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The difficulty with any definition of poverty involves the meaning of minimum needs and the amount of money required to satisfy these needs. (Ansel M. Sharp, 2010) Those in poverty sometimes face an additional obstacle to earning an adequate income. Discrimination as we use it means that equals are treated unequally or that the ‘unequal’s are treated equally. Discrimination exists in the labor market when people with equal productivity are paid different wages or people with differences in productivity are paid equal wages.
Discrimination can also exist in the product market when consumers pay different prices for the same product. (Ansel M. Sharp, Evidence of Discrimination in Our Economy, 2010) Discuss the major impact to society of the problem. In 2001, some six-point-eight million families, or nine-point-two percent of all families, lived in poverty. This translates into more than thirty-two-point-nine million individuals, a staggering number to many Americans who have never been personally touched by poverty. Indeed, some have characterized those who live in poverty as the hidden poor.
Studies have shown that there is a significant turnover in the poverty population: Families and single individuals move into and out of poverty several times throughout the years in response to significant life events. Although no reliable estimate exists for the number of hardcore poverty cases, the incidence of poverty can be easily seen to vary dramatically across a number of demographic characteristics. (Ansel M. Sharp, What is Poverty? , 2010) Just imagine searching through heaping piles of refuse at landfills, looking for anything that could seem partly edible, to satisfy an unending hunger.
Many people around the world face this situation every day of their lives. What could have caused a situation like this to occur? The education and skill level, health or handicap status, and discrimination play a vital role in poverty. A major factor determining whether someone will end up living in poverty, education or skill level can make or break an income. Education plays a vital role in acquiring jobs, learning new skills, and bringing home necessities and comforts of life. A person who doesn’t receive an education has a very small chance of making much money and acquiring skills that would bring home a desirable income.
Many who do not have an education bring their family into a cycle of poverty, where their posterity doesn’t necessarily have the income to go to college or even don’t have a desire to acquire a high school diploma. Poverty rates are higher among families with only one parent or head of household present. Poverty is also related to age, those very young and those very old have higher rates of poverty than those in their prime and middle-age years. The economic cause of poverty is family incomes depend on the quantities of resources that families can place in employment and the prices received for those resources.
To understand poverty, then, it is important to understand what determines the prices paid for human and capital resources and what determines the quantities that can be employed. Under competitive market conditions, the basic principle of wage rate determination is that units of any kind of labor tend to be paid a price equal to any one worker’s contribution to an employer’s total receipts. In other words, workers are paid about what they are worth to employers. What a worker is worth to an employer is referred to by economists as the marginal revenue product of labor. (Ansel M.
Sharp, The Economic Causes of Poverty, 2010) Market discrimination may be traced to two primary sources. These are the power to discriminate in the market and the desire to discriminate. In our complex market economy, the wages of workers vary widely. Even workers hired by the same employer to perform similar jobs are often paid different wage rates. The meaning of wage discrimination is clear enough: unequal pay for equal contributions. But proving discrimination depends on being able to distinguish among individuals on the basis of individual efforts and productivity. Generally, humans are paid pproximately what they are worth in a competitive economy. (Ansel M. Sharp, Evidence of Discrimination in Our Economy, 2010) Employment discrimination means that some people are not hired because of non-economic characteristics such as race or gender. Two individuals with the same training, education, and experience apply for a job, however one is black and one is white. If both do not have the same chance of getting the job, discrimination has entered into the decision-making process. There is a growing belief that discriminatory differences in pay, especially gender differences in pay, occur largely because of occupational segregation.
In general, men work in occupations that employ very few women, and women work in occupations that employ very few men. The economic results of occupational segregation for women are low wages. Women are often relegated to occupations where productivity and experience have little to do with their status and where opportunities for overtime and premium pay are limited. Price discrimination occurs when people of different races or genders are forced to pay different prices for the same good or service, provided the differences are not due to differences in cost of serving the consumer. (Ansel M.
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