Effects of Poverty

Maharashtra State Board: Class 11

Effects

Low National Income: Poverty reduces production capacity and keeps income per person low.
Low Savings and Investment: Poor people cannot save or invest, hindering capital formation and future growth.
Vicious Cycle: Low incomes mean less demand, slowing business and job creation—a self-perpetuating ‘vicious circle of poverty’.
Skewed Economic Power: Wealth gets concentrated among a small group, increasing inequality.
Lower Living Standards: Basic necessities like nutritious food, safe housing, and medical care stay out of reach.
Poor Health: High rates of malnutrition, infant mortality, and disease are common in poor populations.
Limited Education: Poverty forces children to drop out or work instead of studying.
Social Conflict: The gap between the rich and poor widens, leading to frustration and conflict.
High Government Spending: Welfare schemes, subsidies, and relief programmes require large government funds, straining national resources.
Resource Misallocation: More spending on subsidies can mean less for health, education, or infrastructure.

Maharashtra State Board: Class 11

Urban Slums: In cities like Mumbai or Delhi, millions live in crowded slums with poor sanitation and healthcare.
Rural Poverty: Many rural families own little or no land and work as daily wage labourers.

Maharashtra State Board: Class 11

Poverty affects all areas—economy, society, politics, and the environment.
Tackling poverty needs job creation, better health and education, and fairer resource use.