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Explain how a country may experience greater equality in the distribution of income, yet still experience high rates of poverty.

a. High equality implies lower poverty automatically
b. Redistribution policies can reduce inequality but may not alleviate poverty
c. Low income disparity always leads to low poverty rates
d. Poverty rates are solely determined by income inequality

User Koen Weyn
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Final answer:

Greater equality in income distribution does not automatically mean lower poverty rates. A country can have equal distribution of income but if the incomes are uniformly low, poverty can still be high. Redistribution policies may help equality but might not be sufficient to elevate incomes above the poverty line.

Step-by-step explanation:

A country may achieve greater equality in income distribution and still face high rates of poverty due to several factors. Redistributive policies might lead to a more equal distribution of income, meaning the gap between the richest and poorest is reduced. However, if this equalization occurs at low-income levels, people can still be living in poverty. This could happen if the redistribution policies are not sufficient to raise the poorest individuals above the poverty line, or if the overall economic growth of the country is stagnant or declining.

Looking at how governments measure poverty in low-income countries, poverty lines are set to distinguish who is considered poor based on income or consumption data. Even if a country has more equal income distribution, if everyone's income is below or marginally above this set poverty line, the poverty rates wouldn't necessarily improve. Hence, the crucial difference lies in the overall wealth of a country and how it is spread among its population. A uniformly distributed low income across a population will still result in a high poverty rate.

User Jorjj
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