Poverty and disease are the two greatest challenges facing underdeveloped countries.

Poverty and disease are without a doubt two great challenges that undeveloped
countries face each and every day. However, assuming that poverty is defined as the lack of
disposable income, it is not necessarily one of the two greatest challenges that underdeveloped
countries face. There are also two types of poverty: relative poverty and absolute poverty.
Relative poverty is a comparative level of poverty in a country whereas absolute poverty which
is measured in the basic necessities for survival. Absolute poverty is assumed in the statement
as every country has relative poverty but underdeveloped countries have a much greater
amount of absolute poverty. While poverty and disease may pose as huge challenges, the lack
of education and health care, in my opinion, are the two greatest challenges facing
underdeveloped countries.

Poverty and disease are purely the consequences of numerous more significant
challenges. Education and health care are the foundations to building a strong economy, and
without them, poverty and disease will eventually realize. Structural unemployment is one of the
biggest form of unemployment in the economy. In the case of underdeveloped countries, it
comes from the lack of skill, training, and education in the nation. Without sufficient education or
without quality education, not enough people will have the skills that are required to find an
occupation. Because of this, an unemployment gap is created and thus the unemployment rate
in the country will rise. As a result, numerous people will either have no employment at all or
can only find basic jobs that earn extremely low incomes. In both outcomes, people must bear a
lower standard of living.

The lack of education not only diminishes the standard of living in the country, but it also
heavily slows down economic development and growth. Without education, there is a lack of
capital, competent labour, and technology that can be used to promote production by firms and
industries. This will overall decrease the aggregate supply in the economy. Furthermore, from
the increase in the number of people with low incomes discussed earlier, there will be extremely
low levels of productivity in the economy because there is no consumer spending in the
economy. This means that there is no aggregate demand. Without consumer spending, the
firms in the country will lay off more workers because they are supplying more than what the
quantity demanded. This will result in more unemployment and lower incomes. This cycle will
only continue and the economy will only continue to decline.

The second greatest challenge faced by underdeveloped country is the lack of health
care. The lack of health care is more significant than disease because even if diseases exist, an
efficient and publicly available health care system can solve the problem. Furthermore,
improving the health care system will do much more than cure diseases in the economy. By
improving the overall health of individuals in underdeveloped countries, it directly improves
human capital. This allows more people to be able to learn skills and find employment in the
economy instead of being held back by illnesses or sickness. This increases employment in the
country, thus increasing the disposable income and with an overall higher disposable income,
there will be more spending in the economy. An improved health care system will both increase
aggregate supply and demand, thus promotes economic growth. The lack of an efficient health
care system will only slow down economic development.

While poverty and disease are problems that underdeveloped countries face daily, it is
much more significant to tackle the core problems in the economy that cause poverty and
disease to realize. The core problems are the lack of a good education system that is available
to everyone, and a lack of an efficient public health care system. If the countries look to make
investments or is internationally aided in these areas, both poverty and disease could be
avoided along with strong economic development.