Economics

(Unit-1)
Meaning

A state or condition in which a person or community lack of financial

resources and essentials for a minimum standard of living.

It is indeed a common problem which is being face by most of the

underdeveloped and the developing countries of the world. Poverty is
the root to many problems.

Poverty can have diverse social, economic, and political causes and
effects.

Concept

Absolute poverty:

It compares income against the amount needed to meet basic personal

needs, such as food, clothing, and shelter. This type of poverty is found
in developing countries and the underdeveloped countries

Relative poverty:

It measures when a person cannot meet a minimum level of living

standards, compared to others in the same time and place. The definition
of relative poverty varies from one country to another, or from one
society to another. This type of poverty is found in all countries.
Nature and Extent of Poverty:
Programs
Several initiatives have been implemented at both the national and state levels to
address the multiple challenges faced by the poor population. Some are.

1. Mahatma Gandhi National Rural Employment Guarantee Act

(MGNREGA):
MGNREGA guarantees 100 days of wage employment in a financial year to every
rural household whose adult members are willing to do unskilled manual work. It
aims to provide livelihood security, enhance rural infrastructure, and empower
rural communities.

2. National Rural Livelihood Mission (NRLM):

NRLM, also known as Aajeevika, focuses on promoting self-employment and
wage employment opportunities for rural households living below the poverty
line. It provides training, capacity-building, etc to the rural poor.

3. Pradhan Mantri Awas Yojana (PMAY):

PMAY aims to provide affordable housing to economically weaker sections and
low-income groups in both rural and urban areas.

4. Pradhan Mantri Ujjwala Yojana (PMUY):

PMUY aims to provide clean cooking fuel, namely Liquefied Petroleum Gas
(LPG), to households below the poverty line. The program offers free LPG
connections and encourages the use of clean energy sources, and reducing health
hazards.

6. Sarva Shiksha Abhiyan (SSA):

SSA is a flagship program in the education sector, aiming to provide universal
elementary education to all children in the age group of 6-14 years. It focuses on
reducing the educational disparities between different socio-economic groups
through infrastructure development, teacher recruitment, and innovative teaching
methods.
Measures for poverty in India: (5 marks)

1. Employment Generation: Promote job creation through investments in

infrastructure, industries, and the agricultural sector. Encourage entrepreneurship
and support micro, small, and medium enterprises.

2. Rural Development: Implement programs like the Mahatma Gandhi National

Rural Employment Guarantee Scheme (MGNREGS) to provide employment
opportunities and boost rural infrastructure development.

3. Education and Healthcare: Improve access to quality education and

healthcare services, particularly in rural areas. Enhance school facilities, promote
scholarships, and expand healthcare infrastructure to ensure affordable and
accessible services.

4. Gender Empowerment: Implement policies and programs to promote gender

equality, ensure women's access to education, healthcare, and economic
opportunities. Address social and cultural barriers that hinder women's
empowerment.

5. Infrastructure Development: Invest in infrastructure projects to improve

connectivity, access to electricity, water supply, sanitation, and transportation in
rural and urban areas. This enhances living standards and promotes economic
activities.

These measures, when implemented effectively, can contribute to poverty

reduction, improve living standards, and create opportunities for inclusive growth
in India.
Causes of Poverty in India:
 Unemployment
Meaning
The term unemployment refers to a situation where a person actively searches for
employment but is unable to find work. Unemployment is considered to be a key
measure of the health of the economy.
Generally, any person who is not gainfully employed in any productive activity is
called unemployed. Unemployment may be frictional unemployment, structural
unemployment, cyclical unemployment, and voluntary and involuntary
unemployment.
Broadly, unemployment in India can be classified into two groups. They are:
i.) Rural unemployment: Seasonal unemployment, disguised unemployment, and
chronic unemployment.
ii.) Urban unemployment: Industrial unemployment and educated
unemployment.

Types of Unemployment
There are several types of unemployment that can occur in an economy. Here are
some common types:

1. Frictional Unemployment: This type of unemployment occurs when

individuals are temporarily between jobs or are in the process of transitioning
from one job to another.
2. Structural Unemployment: Structural unemployment is a type of
unemployment that occurs when a person cannot find a job that matches their
skills and qualifications.
3. Cyclical Unemployment: Cyclical unemployment is a type of unemployment
which is related to the cyclical trends in the industry or the business cycle. If an
economy is doing good, cyclical unemployment will be at its lowest, and will be
the highest if the economy growth starts to falter.
4. Seasonal Unemployment: Seasonal unemployment occurs when individuals
are employed only during specific seasons or times of the year. For example,
agricultural workers they are employed according to season.
5. Technological Unemployment: Technological unemployment arises when
advancements in technology lead to a decrease in the demand for certain types of
jobs.
6. Voluntary Unemployment: Voluntary unemployment refers to individuals who
choose not to participate in the labour market and are not actively seeking
employment. This choice could be due to various reasons such as pursuing higher
education, early retirement, caring for family, or personal preferences.

Measures of Unemployment
The measures to solve unemployment problems are as follows:
1. Change in industrial technique: to solve the unemployment problem, a
production technique focusing on the needs and means of the country should be
adopted. Capital-intensive technology should be replaced by labour-intensive
technology.

2. Dealing with seasonal unemployment: As agro-based and agriculture sectors

provide only seasonal employment. Measures like multi-cropping, animal
husbandry, horticulture, plantation, and horticulture should be adopted. Also,
industries like the cotton industry should be promoted.

3. Changes in the Education system: There is a need to change the present

education system. It should emphasize vocational education rather than imparting
static knowledge. Colleges and universities should be available to students who
wish to pursue higher education.

4. Assistance on Self-employment: Most people in India are self-employed, but

unfortunately, due to a lack of professional knowledge, they are not able to get the
desired results. Therefore, they should be helped by giving technical training and
using the raw material properly.
5. Introduction of new governmental measures: The government should take
the initiative to increase labour productivity and develop better employment
opportunities for all.

6. Population control: Population is one of the major concerns associated with

the unemployment rate. Therefore, the population rate must be checked, especially
in rural areas where birth control methods and family planning considerations
must be discussed more.

What are the Major Causes of Unemployment in India?

In India the caste system is prevalent. The work is prohibited for specific castes in
some areas. In big joint families having big business, many such persons will be
available who do not do any work and depend on the joint income of the family.

1.Rapid Growth of Population: Constant increase in population has been a big

problem in India. It is one of the main causes of unemployment.

2.Dominance of Agriculture: Still in India nearly half of the workforce is

dependent on Agriculture. However, Agriculture is underdeveloped in India. Also,
it provides seasonal employment.

3.Fall of Cottage and Small industries: The industrial development had adverse
effects on cottage and small industries. The production of cottage industries began
to fall and many artisans became unemployed.

4.Immobility of Labour: Mobility of labour in India is low. Due to attachment to

the family, people do not go to far off areas for jobs.

5. Lack of skills and education: Many job seekers in India do not possess the
required skills or education for available job opportunities. This mismatch
between the skills demanded by employers and those possessed by job seekers
leads to unemployment.
Employment generating programmes.

Nehru Rozgar yojana:

The Government of India launched the Nehru Rozgar Yojana in 1989 under the
Ministry of Urban Affairs and Employment. It is aimed at providing employment
opportunities for the urban poor through three components: wage employment,
micro-enterprises, and shelter upgradation for the urban poor population in India.

National food for work programme:

The 'National Food for Work Programme' was launched in India in the year 2004.
It was launched in 150 backward districts of India on 14 November 2004. Its
objective was to generate supplementary wage employment.
ECONOMICS
(Unit-1)