 Hi welcome to our second video lecture in this lecture we will talk about measures of inequality and poverty. Now again last week we introduced the basic concept of development economics and said what are some of the major questions we talk about and in that light inequality and poverty are certainly two of the major themes that we need to talk about. So what do we know about inequality? First these are two very powerful quotes that I want to direct your attention to. Adam Smith considered the father of modern economics famously said that no society can surely be flourishing and happy of which the far greater part of the members are poor and miserable clearly an indication of the existence of poverty as being a detriment to a society's well-being and a society's happiness. The second quote is on inequality by Thomas Piketty who was the author of this famous book capital in the 21st century. He says for millions of people wealth amounts to little more than a few weeks wages in a checking account of low interest or low interest saving account a car and a few pieces of furniture. The inescapable reality of this wealth is so concentrated that a large segment of society is virtually unaware of its existence so that many people imagine that it belongs to surreal or mysterious entities. That is why it is so essential to study capital and its distribution in a methodical systematic way. Now the question to be asked here is what is the role of inequality what is the role of poverty and whether one takes an ethical lens or whether one takes an economic lens or whether one takes a social lens how how is it important how is it that these issues of inequality and poverty affect our our contemporary world. Right now again there is obviously no consensus on this so there's a traditional view on say inequality which says that inequality creates incentives for hard work and innovation for instance only if you see that I have a better than a bigger card then you have well you get an incentive to work hard in order to get that card if you want that. Another important point is that higher inequality allows higher tax revenue to be collected which can then be which can then be used for you know the development purposes. Now so this was the traditional view that there's nothing wrong with inequality inequality is good inequality may help you know help propel economic growth however there's a lot of new evidence which sort of contradicts this traditional view for instance excess inequality creates distrust and reduces investments in long-term projects inequality hinders people's access to health and education and economic inequality weakens political democracy. Now in light of this new sort of evidence one is forced to relook at inequality from a more critical lens and this is what this presentation aims to do. So basically in this presentation what will be interested in will be interested in measures of inequality will be interested in the impact of inequality on economic growth and likewise measures of poverty and the impact of poverty on growth right. Now finally before I end this presentation it's very important to think of what Adam Smith had to say on this again the poor man is ashamed of his poverty he feels that it either places him out of the sight of mankind or if they take any notice of him they have however scarce any fellow feelings with the misery and distrust he suffers to feel that we are taken no notice of necessarily damps the most agreeable hope and disappoints the most ardent desire of human nature the poor goes out and comes in unheeded and when in the midst of a crowd it is the same obscurity as if shut up in his own hobble. Now this this is a functional impact of poverty which is something you don't see in you know hard-hitting traditional economic reasoning but here is a functional impact of what it does or what poverty does to one's behavior one's attitude towards life coming by no less than Adam Smith it does give us some idea of the extent of the problem and how we can deal with it. So I will end this video presentation here but in the main lecture the power point for this for this for this section you will see a detailed discussion of the various measures of poverty and the various measures of inequality how to use them what are the benefits what are the what are the negatives of using those and how is it that we can use those measures to answer questions like whether inequality is good for the economy or whether it's bad for economic growth all right so thank you so much for listening to me but make sure you go through the entire main power point in detail thank you