Essay on Measuring Economic Participation and Social Protection
Using the World Bank’s measure of poor, in 2011, the poverty headcount ratio for Belize, El Salvador, Guatemala and Honduras are 43%, 40.6%, 53.7% and 61.9% respectively (World Bank, 2013). Honduras has the highest number of individuals living below the poverty line, followed by Guatemala, Belize and then El Salvador. Although Guatemala had the least unemployment rate, it, nevertheless, has high poverty rates relative to the three other countries. One can only infer that individuals are underpaid in Guatemala, or the cost of living is higher compared to their minimum wage. Belize, on the other hand, is the only economy that has unemployment rates in double digits, but it had the second lowest poverty rates, relative to the other three countries.
Income also plays an important role in economic participation and social protection, where countries with higher GDP per capita, tend to have increased standards of living, as compared to countries with lower GDP per capita. GDP per capita does not give us information regarding the distribution of income, since it is just an average of income received