Can the problem of poverty in the UK be solved through the operation of market forces?
To what extent can the problem of poverty in the UK be solved through the operation of market forces? Justify your answer. (June 2017)
- Plan
- Introduction: relative and absolute poverty, market failure
- Paragraph 1:
- Clear argument: government intervention is not needed to reduce relative poverty + can make things worse
- free market leads to wage differentials
- surgeons have a high equilibrium wage
- cleaners have a low equilibrium wage
- gov intervention makes things worse e.g. minimum wage
- Diagram: two labour markets
- Evaluation: progressive taxes/gini coefficient
- Clear argument: government intervention is not needed to reduce relative poverty + can make things worse
- Paragraph 2:
- Clear argument: government intervention is needed to solve absolute poverty
- some people are not able to increase their MRP and therefore would be left behind in a completely free market society e.g. people with disability/old age
- state provision
- Diagram:
- (Analysis)
- Evaluation: opportunity cost
- Clear argument: government intervention is needed to solve absolute poverty