The rich are growing richer faster than the poor in Malaysia, and widening disparities in standards of living can threaten the growth process.
Poor are still lagging behind in the region’s rapid development even as poverty rates decline. Both relative and absolute inequality have increased in most parts of Malaysia.
While relative inequality is concerned with proportionate differences in incomes, absolute inequality is concerned with actual dollar differences in incomes.
Most well-off have experienced considerably larger increases in their standards of living than the least well-off. For example, the expenditures of the “rich” (top 20%) have increased much more than those of the “poor” (bottom 20%).
In Malaysia low growth in incomes of the poor is reflective of weakness in the pattern of growth,” “Growing inequalities can weaken social cohesion.”
A country which saw one of the most rapid increases in inequality over the last 10 years and also experienced a political conflict, found that a lack of economic opportunities was significantly associated with a higher intensity of political tsunami.
In societies where wealth is concentrated in the hands of a few, there is a danger of policy levers being captured by the rich for their own benefit and a weakening of the institutional foundations of the growth process
What is causing the gap between rich and poor to widen in Malaysia?
Unevenness in growth in incomes across urban and rural areas, leading and lagging sub-national regions, and highly educated households and the less educated as important factors associated with increases in inequality. Some of the unevenness in growth is a natural outcome of the development process and is to be expected. The process of economic development is unlikely to start in every part of an economy at the same time and rising inequality is not unusual during periods of rapid growth and major structural change.
Weaknesses and imbalances in policy have also been at play. In several cases, slow growth in rural incomes has resulted from weaknesses in public investments in rural infrastructure and a policy environment that has kept private investment away.
Meanwhile, growth in urban areas has been insufficient to absorb surplus labor from rural areas. Instead, new opportunities generated by urban growth in Malaysiaa have favored the highly-educated, further aggravating the earnings gap between the rich and poor.
Policies that can counter the negative distributional impacts reforms are needed. These are well designed social protection mechanisms and skills and training programs.
Partnership between the public and private sectors is needed to develop new economic activities and industries that generate new employment opportunities that do not bypass the poor.
Policy makers have to focus on radically improving the quality of basic health care and education available to Malaysia's disadvantaged.
The key challenge to public policy here lies on not just increasing the quantum of public expenditures, but also ensuring that these are well targeted, effective, and funded through mechanisms that do not detract from economic growth.
PEOPLE'S POWER
I am getting really sick and tired of this type of article.
ReplyDeleteThe rich will always get richer, faster, than the poor.
Why? Do your math lah!
If you got RM 1,000, and you put in the bank. After a year, how much you get in interest?
If you put in RM 1,000,000,000 instead, how much would you get in a year???
It's so simple, and yet the author had to write a whole page of garbage to come to that conclusion.
Sigh !!
..... And one more thing about this type of article ...
They always talk about "inequalities" and they always talk as if the poor are some how handicapped.
Totally BULLSHIT !!
How many hours a poor man get in a day?
How many hours a filthy rich man get in a day?
Tell me lah !
The same thing with brain.
How many brains a rich guy has?
How many brains a poor guy has?
Why can't people just open their freaking eyes and just SEE the world as it is ... this world is NOT only about the rich vs the poor ... it is all about how you manage your time, and how you use your brain !!
from the previous commentor, it is not true that u can't have the poor getting richer compare to the rich. like here in Australia, the poor are getting much richer compare to the rich. it was in an article few days back here
ReplyDeleteIf only it were so simple...
ReplyDeletePoverty is a vicious cycle which carries across generations. Once you're caught in it, its pretty hard to get out. Only the rare few make it out, and that's usually with outside assistance too (loans, scholarships, etc.). Many will always be struggling to make ends meet no matter how hard they work.
If you're poor, you probably have few qualifications and can only seek out low paying jobs. You will not be able to afford a better education for your children, and they might even be forced to leave school to help support the family. And so the cycle continues...
We also tend to forget that these people performing the so-called 'menial' labor rubber tapping and sweeping the streets are also essential. Like the saying goes, its a dirty job but someone has to do it. However, there's no reason why they should be paid pittance for it.
Go check out the income disparity between blue and white collar jobs in developed countries like Australia and Japan. You'll find that the gap isn't as wide as in Malaysia. Heck, its possible to make a good living as a plumber in Australia and your pay will be no less than any IT or business graduate...maybe more even...
So don't just go blaming the poor for being the problem. Whether you want to acknowledge it or not, our economic prosperity is built on their backs so there's no reason why they should be treated like dirt. A minimum wage law would be a good start, but I don't think our present govt is interested in that.
Of course, there are a few who are poor simply because they're lazy, but let's not make a blind assumption that everyone below the poverty line aren't willing to work. What they need is are opportunities, and I dare say that its the responsibility of those of us who are better of to help them out.
As for the subject of brains, there's actually very little correlation between wealth and intelligence. Not every member of MENSA is a millionaire and many are in fact very much middle class (although they do tend to have higher than average incomes). I don't think its fair we should condemn someone to be poor just because they're not born into the top 2% of the population.
Chances are you, who made the snide remark, aren't any smarter than the poor either. You just have a degree and they don't. Better educated does not mean smarter. Having a degree just means you get more opportunities. Doesn't make you a better person in any way.