In class we discussed economic inequality and it’s causes and effects in urban areas. Financial inequality is a complicated topic that has ties to social, geographic, and economic issues. One way to measure this inequality is the Gini Coefficient of Inquality. The Gini coefficient is measured as the area between the lorenz curve, which shows the income distribution, and the line of equality. A gini coefficient of 0 represents complete equality and 1 represents complete inequality.
A Gini Coefficient is useful to measure economic inequality as it exists but to understand the issue, it’s causes and effects must be investigated. This paper discusses how poverty traps develop in urban environments and how they affect the people who live in them. The paper looks at the problem through social, economic, and geographical lenses to better understand the issue. Commonalities among these areas include lack of access to services, infrastructure, and jobs which leads to the overall degradation of the area. These places are often high density and overcrowded which only adds to competition for work and resources. The situation leads to a culture of low education levels, high unemployment, and high crime rates in the area. People born into these “poverty traps” are unlikely to be able to escape and move to an area with better opportunities. This portion of the population that’s basically being abandoned only adds to the economic inequality of the country and is a waste of social capital that can’t be utilized. Overall, with growing economic inequality, more work needs to be done to understand it’s causes and effects. People born into poverty traps have little hope of getting out of poverty without assistance.