In recent times we have seen the income distribution in many developed nations expand, meaning that the gap between rich and poor has grown. Coupled with this is the resultant degradation of economic and social mobility. This serves to show that they there is a tendency for those that are poor, to remain poor. There are a number of causal factors that seemingly predicate this fate of a poverty cycle. The issues that contribute to this range from the education and wellbeing of the individual, societal influences and values, their spending habits, their living conditions as well as their ability to access funding as a means of fuelling entrepreneurial endeavours.
Those that are born into poor families will not have access to the resources
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In spite of the poor possessing little to no disposable income, research has shown that only 56-78% of their income is spent on necessities in rural areas and 56-74% is spent on necessities in urban areas. The remainder of these families’ budgets are spent largely on alcohol, tobacco as well as cultural events such as festivals. This underlines the values of these poverty stricken households, the clear undervaluing of nourishment and education guarantees that no further amount of their income will be diverted to these causes. This creates another devastating cycle whereby these values are passed onto later generations and they subsequently ignore investing in health and education in favour of other goods and services.
Living conditions are a key contributor to the seemingly endless cycle of poverty that exists, this is a result of both the direct and indirect impacts that those poor living conditions create. When someone lives in inadequate shelter there are a number of financial and health implications. Someone who lives in a primitive dwelling will be more likely to contract illnesses and subsequently impact their ability to work. As well as this, those who live in temporary make piece dwellings will find it impossible to obtain lines of credit. When banks allocate credit, they look to secure collateral on the credit as well as assessing the applicant’s ability to service their new financial