Q4 ECON :D

• WHAT IS POVERTY?➢ “Poverty is hunger. Poverty is lack of shelter. Poverty is being sick and not being able

  to see a doctor. Poverty is not having access to school and not knowing how to read. Poverty is not having a job, is fear for the future, living one day at a time.”
• 1. These two approaches represent two bases on which poverty is defined. The first is an absolute income test, which sets a specific income level and defines a person as poor if his or her income falls below that level. The second is a relative income test, in which people whose incomes fall at the bottom of the income distribution are considered poor.
• 1. In the first semester of 2021 (Philippines), a family of five needed, on average, PhP 12,082 per month to meet their minimum basic food and non-food needs. Families earning less than this are considered poor.
• CAUSES OF POVERTY: (1) Lack of Education, (2) Unemployment, (3) Discrimination, (4) Unequal Distribution of Resources, (5) Systemic Issues
• IMPACTS OF POVERTY: (1) Hinders access to education, (2) Impacts an individual’s well-being, (3) Increase of crime rates within communities, (4) Social exclusion, (5) Psychological effects
• 1. While poverty has a bi-directional relationship with mental health, to date, there are no existing studies written on Philippine Mental Health Economics (MHE).
• 1. In the Philippines, poverty is viewed regionally due to significant economic development disparities due to limited education, healthcare, and employment opportunities.
• SOLUTIONS AND INTERVENTIONS FOR POVERTY

  ➢ EDUCATION INITIATIVES

  (1) Curriculum Enhancement (2) Infrastructure Development (3) Teacher Training and Support
• SOLUTIONS AND INTERVENTIONS FOR POVERTY: GOVERNMENT POLICIES

  (1) Investment in Education

  (2) Rural Development and AgrarianReform

  (3) Infrastructure

  (4) Good Governance and Anti-Corruption

  (5) Measures
• 1. SOLUTIONS AND INTERVENTIONS FOR POVERTY: SOCIAL PROGRAMSo ConditionalCashTransfer(CCT)Programso Healthcare Subsidies and Insurance Programs o SocialPensionPrograms
• 1. SOLUTIONS AND INTERVENTIONS FOR POVERTY: MICROFINANCEo MicrocreditPrograms

  o Microinsurance Programs

  o CapacityBuildingandFinancialEducation
• 1. SOLUTIONS AND INTERVENTIONS FOR POVERTY:

  COMMUNITY DEVELOPMENT PROJECTS

  o LivelihoodandSkillsTrainingProgramso AgriculturalDevelopmentInitiativeso CommunityEmpowermentandSocialMobilization
• 1. LABOR: It refers to work, usually with the intention of receiving payment equal theamount of labor done.
• 1. The labor force is the total number of people working or unemployed.
• 1. UNEMPLOYMENT: It refers to a situation where a person actively searches for employment but is unable to find work. The unemployment rate is the percentage of the labor force that is unemployed.
• 1. According to the Philippines Statistic Authority, the unemployment rate in the Philippines as for January 2024 stands at 4.5 percent.
• 1. INFORMAL SECTOR: These jobs are often unskilled and labour intensive.
• 1. According to the International Labour Organization, the informal economy in the Philippines consists of independent, self-employed small-scale producers and distributors of goods and services. Nearly 40% of the workforce in the Philippines is considered employed in a “vulnerable” source of employment, which is a proxy measure for the informal economy.
• 1. UNEMPLOYMENT is a part of the Macroeconomic discipline where we can calculate the unemployment rate by dividing the number of unemployed people by the total number in the labor force, then multiplying by 100.
• 1. CAUSES OF UNEMPLOYMENT:

  • ➢  Lack of Decent Employment Opportunities
  • ➢  Lack of Relevant Skills and Competencies
  • ➢  Poverty Cycle
  • ➢  Limited Work Experience
  • ➢  Geographical Disparities
• 1. When the cost of goods and services rises in an economy, the purchasing power of the populace declines, and a phenomenon known as inflation takes place.
• 1. Inflation is a result of how the market behaves in an economy. There are three main causes of inflation that are grouped into categories such as: demand-pull, cost- push, and inflation expectations.
• 1. When the availability of money increases, the demand for goods rises, which results in an upsurge in prices as sellers determine this as a great opportunity to earn a greater profit.
• 1. Cost-Push Inflation happens when all of the supply produced in a market decreases due to the increase in the cost of production. Cost-Push Inflation can

  lead to the deduction of employees and raise the number of unemployed, as well as decrease the purchasing power of consumers.
• 1. Cost-push inflation means prices have been "pushed up" by increases in the costs of any of the four factors of production—labor, capital, land, or entrepreneurship— when companies are already running at full production capacity.
• 1. Demand-pull inflation occurs when there is an increase in aggregate demand, categorized by the four sections of the macroeconomy: households, businesses, governments, and foreign buyers.
• Recommendations to address inflationary pressures

  1. Investing in sustainable agricultural practices

  2. Providing monetary aid to farmers and fishermen

  3. Investing in infrastructure development (transportation, ports, energy)

  4. Dealing with government deficits and debt

  5. Rationalizing the government budget

  6. Diminishing loopholes
• Investing in sustainable agricultural practices and providing monetary aid

  • Improves domestic productivity
• Investing in infrastructure development

  • Increases the efficiency of production and distribution processes
• Dealing with government deficits and debt

  • Reduces unnecessary expenditures
  • Reduces budget deficit
  • Anchors inflation expectations
• 1. Tariffs - Taxes imposed by governments on imported goods to regulate trade, protect domestic industries, and raise revenue.
• 1. Duties - Fees imposed on goods imported or exported from a country, serving as a source of revenue for the government. They include customs duties, value-added tax (VAT), excise taxes, and other charges, varying based on factors such as the type of goods and their country of origin.
• 1. Ad valorem (ad. val.) - a type of tariff or tax calculated as a percentage of the value of the goods being imported or exported.
• 1. Trade Deficit - takes place when the imports done by a country exceed that of the exports done by a country in a fiscal year.
• 1. Customs duties: Taxes levied on imported goods at the time of clearance through customs.
• 1. Value-added tax (VAT): A tax added to the value of goods at each stage of production or distribution.
• 1. Excise taxes: Taxes imposed on specific goods such as alcohol, tobacco, and petroleum products.
• 1. Other charges: Various fees and levies related to customs clearance and processing, such as administrative fees and anti-dumping duties.
• 1. REPUBLIC ACT NO. 10667: A primary competition law approved in 2015 of the Philippines for promoting fair competition in the marketplace and protecting well-being of consumer in the process.