Global Inequality and Environmental Impact on the Economy

Inequality and Development

Market failures have the worst consequences for people, such as an increase in income inequality and persistent poverty.

Global Inequalities

• Inequalities within a State: In most countries around the world, these have increased over recent years.
• Inequalities between countries: These inequalities are greater than those that occur within any country.

Underdevelopment

When we travel to a developing country, we know we are in a different country, which is poorer than ours, and we could categorize it as underdeveloped, developing, poor, or less developed.

Characteristics of the Poorest Countries

• Low income per capita: These countries have a very low per capita income.
• Strong social and income inequalities: They usually have significant internal inequalities. The countries in the worst situation worldwide, the vast majority are in this group.
• Low productivity: The low level of technology, training deficiencies, inadequate nutrition, and poor health conditions are some of the factors behind this low productivity.
• Lower life expectancy: At present, many poor countries are hit by AIDS, reducing life expectancy.
• High rates of unemployment and underemployment: A large part of the population is unemployed, and underemployment is rife.
• Dependence on the primary sector: Most of the production of these countries comes from the primary sector.
• Strong imbalances in the production and technological structure: In these countries, companies using the latest technological systems coexist with others using craft and obsolete techniques.
• External dependence: Most of these countries are economically dependent on wealthier ones to maintain a minimum level of income.
• Imperfect market and limited information: The market structure of these countries is very limited and deficient.

The Economy and the Environment

Economic Growth and Environmental Damage

High world economic growth can only operate because of high natural resource consumption. Environmental damage is alarming, and many resources are running out.

Consumption and the Environment

Consumption is exaggerated, and the global balance is not equitable. Rich countries account for 20% of the world's population but concentrate 86% of global consumption, while the remaining 80% of the population consumes only 14%. These differences indicate that we could hardly extend our consumption patterns to the entire world population.

Negative Effects and Consequences of Economic Activity

All environmental constraints have a direct impact on the economy. If they are not fought effectively, our resources will be reduced or made worse, which will resonate in a reduction of production possibilities in the future.