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from The Global City, Northwestern University, Summer 2011, graduate public policy course

from The Global City, Northwestern University, Summer 2011, graduate public policy course

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  • 1. Margins/Berlin MPPA-DL 452 Session 5
  • 2. Course Themes
    • Dynamics: Globalization, Urbanization
    • Circuits: Transnationals, Diasporas
    • Centers: Agglomeration, Sprawl
    • Margins: New Inequalities
    • Ecologies: Sustainability
    • Architectures: A Sense of Place
    • Crises: Globalization in Reverse
    • Frontiers: Looking Ahead
  • 3. Berlin, Germany
  • 4. Berlin 1945
  • 5.
    • November 2009 marked the 20th anniversary of the fall of the Berlin Wall and the beginning of German reunification. 
    • Begun in August 1961, the Berliner Mauer separated East Berlin from West Berlin for over twenty-eight years until November 9, 1989.
    • “ During this period the Wall stood as an ugly symbol of human isolation and cruelty, as about one hundred persons were killed by East German security forces while trying to cross the Wall into West Berlin.”
    Source: George Mason University Libraries Special Collections and Archives
  • 6.  
  • 7.  
  • 8.  
  • 9.  
  • 10. Source: Accessed at www.urban-age.net on 10/19/09
  • 11. Source: Accessed at www.urban-age.net on 10/19/09
  • 12. Source: Accessed at www.urban-age.net on 10/19/09
  • 13. Source: Accessed at www.urban-age.net on 10/19/09
  • 14. Source: Accessed at www.urban-age.net on 10/19/09
  • 15. unemployment
  • 16. Source: Statistisches Landesamt Berlin, accessed 10/19/09 at berlin.group.shef.ac.uk/berlin.html
  • 17. Most of us make at least three important decisions in our lives: where to live, what to do, and with whom to do it. Daniel Gilbert, Stumbling on Happiness
  • 18. Civility means that the diversity of urban life becomes a source of mutual strength rather than a source of estrangement and civic bitterness. In the past this issue has been framed in terms of ethnicity or culture and in the current period of inequality I think it needs to be increasingly framed in terms of economics. Richard Sennett, Professor of Sociology, London School of Economics and Political Science and MIT
  • 19. Margins: poverty and inequality
  • 20. poverty is:
    • lack of income
    • lack of drinking water
    • lack of access to health care
    • lack of protection against adverse shocks
    • higher infant mortality
    • lower life expectancy
  • 21.  
  • 22. poverty across countries Country (in order of increasing GNP per capita) % of Population below $1 a day Bangladesh 29.1 Kenya 26.5 Sri Lanka 6.6 Indonesia 7.7 Philippines 14.6 Jamaica 3.2 Paraguay 19.5 Costa Rica 6.9 Malaysia <2 Brazil 9.0
  • 23.  
  • 24. less and more poverty in the world
  • 25.  
  • 26. inequality across countries Country (in order of increasing GNP per capita) Income share of lowest 40% of households Ratio of highest 20% to lowest 20% Bangladesh 22.9 4.0 Kenya 10.1 18.3 Sri Lanka 22.0 4.4 Indonesia 20.4 5.1 Philippines 15.5 8.4 Jamaica 16.0 8.2 Paraguay 8.2 27.1 Costa Rica 12.8 12.9 Malaysia 12.9 11.7 Brazil 8.2 25.7 United States 16.1 8.5
  • 27. the more equal vs. less equal
  • 28. Today there are more part-time and temporary jobs and generally fewer protections and fringe benefits for growing portions of the workforce. These changes in the employment relation have contributed to reshaping the sphere of social reproduction and consumption, which in turn has a feedback effect on economic organization and earnings…it reproduces growing income disparity, labor market casualization, and consumption restructuring along high- and low-end markets. Saskia Sassen, Cities in a World Economy , p. 173
  • 29. does inequality matter?
    • poverty is a more pressing imperative than inequality
      • if we can improve living standards of the poor at the cost of some inequality, it’s worth it
    • inequality reflects a “natural” distribution of talents and capabilities, as well as effort
    • inequality is good because it creates incentives for effort
      • efforts to overcome it (by taxes and redistribution) stifle effort
    skeptical view:
  • 30.
    • extreme income inequality leads to inefficiency
    • lack of access to credit leads to under-financing of good productive opportunities
    • since the middle class has the highest average and marginal saving rates, income inequality leads to lower saving and investment
    economic view: does inequality matter?
  • 31.
      • inequality in income and assets are associated with inequality in political power, which influences patterns of government spending and services
    • extreme income inequality leads to political and social instability
        • “ the poor try revolution while the rich try corruption and rent-seeking to retain power”
    • violates notions of fairness and justice
    political and moral views: does inequality matter?
  • 32. the Lorenz curve
  • 33. income distribution
  • 34. Gini coefficient
  • 35. Gini coefficient
  • 36. total poverty gap TPG = the amount relative to the poverty line that has to be transferred to poor households to bring their incomes up to the poverty threshold  income distribution
  • 37. the Kuznets curve time
  • 38. the “Kuznets process”
    • the economy comprises a low-inequality and poor (low-mean) rural sector, and a richer urban sector with higher inequality
    • the migration process is such that a representative slice of the rural distribution is transformed into a representative slice of the urban distribution
    •  absolute poverty will fall with urbanization; income inequality will rise up to some point then fall (inverted U)
  • 39. poverty and inequality under the Kuznets process Inequality Urban population share Total poverty Rural poverty rate Urban poverty rate
  • 40. growth leads to less poverty
  • 41. % poor has declined
  • 42. drivers of economic growth
    • investment
    • education
    • population
    • inflation
    • inequality
    • foreign aid
    • redistribution
    + denotes a positive effect in the direction shown ? – + + – – – Source: Gylfason and Zoega (2000)
  • 43. Does urbanization reduce poverty?
  • 44.  
  • 45. rural poorer than urban
  • 46. migration to cities
    • jobs/income – more (agriculture  diverse)
    • health care - better
    • education - available
    • risks:
      • inequality
      • crime
      • political instability