Chapter 8 Global Stratification

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Chapter 8 Global Stratification

• Wealth and Poverty in Global Perspective
• Problems in Studying Global Inequality
• Classification of Economies by Income
• Measuring Global Wealth and Poverty
• Global Poverty and Human Development
• Theories of Global Inequality
• Global Inequality in the Future

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What Is Global Stratification?

• Unequal distribution of wealth, power, and
  prestige on a global basis.
• Between 1960 and 1990, the gap in global income
  between the rich and poor countries continued to
  widen.

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Studying Global Inequality

• The Three Worlds Approach
• Distinguishes nations based on economic
  development and standard of living.
• Levels of Development Approach
• Most controversial terminology used to describe
  global stratification.

4
Economic Categories Used by the World Bank

• Low Income - nations with a GNP per capita of
  785 or less, in 1998 dollars.
• Middle-income - nations with a GNP per capita of
  more than 785 but less than 9,655 in 1998
  dollars.
• High-income Economies (25 nations)- nations with
  a per capita income of 9,655 or more in 1998
  dollars.

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Poverty

• Absolute poverty- people do not have the means to
  secure the necessities of life.
• Relative poverty- people can afford necessities
  but are unable to maintain an average standard of
  living.
• Subjective poverty- actual income compared with
  income earner's expectations.

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The Gini Coefficient

• A measure of income inequality ranging from 0
  (everyone has the same income) to 100 (one person
  receives all the income).
• Indicates that global inequality between the rich
  and poor countries continues to exist.
• Shows that similar disparities exist within
  nations in the world.

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Human Development Index (HDI)

• Criteria for measuring a countrys level of
• development
• life expectancy
• education
• living standards

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Theories of Global Inequality

• Development and Modernization Theory
• Dependency Theory
• World System Theory

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Development and Modernization Theory

• Four Stages of Economic Development
• Traditional stage -very little social change
  takes place and people do not think of changing
  their present circumstances.
• Take-off stage - period of economic growth
  accompanied by a growing belief in individualism,
  competition, and achievement.

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Development and Modernization Theory

• Four Stages of Economic Development
• Technological maturity- the country improves in
  technology, reinvests in new industries, and
  embraces the values and institutions of
  high-income developed nations.
• High mass consumption - a high standard of living
  that encourages consumption.

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Dependency Theory

• Disputes that economic growth is the key to
  meeting important human needs in societies.
• Argues that the poor nations are caught in a
  cycle of structured dependency on the richer
  nations.
• Most often applied to the newly industrializing
  countries.

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World System Theory

• Three types of nations
• Core nations- possess most of the world's capital
  and technology.
• Semiperipheral nations- a midpoint between the
  core and peripheral.
• Peripheral nations- dependent on core nations.

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New International Division of Labor

• Production is fragmented and assigned to
  whichever part of the world can provide the most
  profitable combination of capital and labor.
• High-income countries have become dependent on
  low-income countries for labor.

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 Global Inequality In The Future

• In some regions, poverty continues to undermine
  human development.
• Modern technology and economic growth could
  reduce poverty and increase opportunities.
• Health and education may continue to improve in
  lower-income countries, resulting in more
  advances.