Sage-Tips

How can poor countries break the vicious circle of poverty?

The developing countries can achieve rapid economic growth by making the efficient use of natural resources. By proper use of resources we can increase the production and per capita income of the country. The less developing countries should reduce their dependence on foreign aid.

Is it possible to break the cycle of poverty?

Families trapped in the cycle of poverty, have either limited or no resources. There are many disadvantages that collectively work in a circular process making it virtually impossible for individuals to break the cycle.

What is vicious circle of poverty explain?

Vicious circle of poverty implies that poverty is the cause of poverty. A poor person, in order to repay his existing debt, will borrow some more, thereby adding to his debt. Further, he will also incur interest payment obligations. This will only increase his total amount of debt.

What is the solution of vicious circle of poverty?

Detailed Solution The correct answer is Nurkse. The vicious circle of poverty was given by Professor Ragnar Nurkse. It says that a low level of income will lead to a lower level of savings and investment. Therefore, the low investment will lead to low productivity which will again lead to low income.

What is the main reason for vicious cycle of poverty in India?

Hence, it can be concluded that a major reason for poverty is the menial quality of jobs with low wage rates. Adding to that is the problem of unskilled labourers in India. This occurs because the majority of our population is illiterate, which is also a reason why the people are not employed.

Can education break the circle of poverty?

But, could education be so powerful that it can break the cycle of poverty across the world? Many studies and professionals say, yes. Statistics show children from low-income families face more educational setbacks and obstacles than those from higher-income families.

What is vicious circle in economics?

The Vicious Cycle: Why the Poor Get Poorer A vicious cycle (also known as a vicious circle) is when a chain of negative events reinforce themselves. The situation spirals in a downward loop, becoming increasingly worse with time.

Why vicious circle of poverty is an important issue for developing nations?

Since savings are low, investment is low. Low investment means low productivity levels, and, with low productivity levels, people will always remain poor. The basic logic of this vicious circle argument is that the greatest obstacle towards the development of an economy is poverty.

What are the causes of poverty in developing countries?

Less productivity in agriculture: In agriculture, the productivity level is very low due to subdivided and fragmented holdings, lack of capital, use of traditional methods of cultivation, illiteracy etc. The very reason for poverty in the country is this factor only.

Why are the poor in India still struggling to get out of vicious circle?

Answer: Hence, it can be concluded that a major reason for poverty is the menial quality of jobs with low wage rates. Adding to that is the problem of unskilled labourers in India. This occurs because the majority of our population is illiterate, which is also a reason why the people are not employed.

How can under developed countries break the vicious circle of poverty?

If the under developed countries adopt the following policies, they can remove the obstacles and can break the vicious circle of poverty. 1. Proper Use of Natural Resources :- The developing countries can achieve rapid economic growth by making the efficient use of natural resources.

What is the doctrine of vicious circle of poverty in UDC?

1. The doctrine of vicious circle of poverty in UDCs is an easy explanation of nature. There are so many other reasons of vicious circle in these countries. 2. The experience of Latin American countries have proved that underdeveloped countries can also develop. 3.

Is a financially poor country trapped in its own poverty?

A financially poor country is trapped in its own poverty. A country can get rid off from poverty if its rate of capital formation increases than the rate of population growth. So capital formation is the key to economic development by demand and supply of capital. The production of the poor country is low.

What are the reasons for the vicious circle in Latin America?

There are so many other reasons of vicious circle in these countries. 2. The experience of Latin American countries have proved that underdeveloped countries can also develop. 3. The doctrine of vicious circle neglects the so many important reasons like lack of entrepreneurs, political, social and religious atmosphere.