Get help from the best in academic writing.

Portfolios of the Poor essay help Education online class help

How the world’s poor live on $2 a day’ Summary The book describes the findings of four researchers who studied how extremely poor households in India, Bangladesh, and South Africa manage their money by saving when they can and borrowing then they need to – through very creative process, which involves different methods: storing savings at home, joining savings clubs, insurance clubs, borrowing from lenders, neighbors, relatives, employers, or financial institutions.

Authors highlight that managing money well is absolutely central to poor people, they represent challenges of living on one or two dollars per day by constructing so called ‘financial diaries’ – tracks of poor people cash flows and household balance sheets over a one year period of time. The recorded behavior and commentary of the 250 diarists show how and why poor people could benefit from institutional financial services offering flexible payments and cash flows to meet their variable and uncertain needs.

In the book researchers are addressing three fundamental needs of the poor: 1) being able to manage daily expenses, 2) coping with emergencies like funerals, lack of food, and 3) opportunities to accumulate lump sums. The authors draw attention to the fact, that they call ‘triple whammy’ – small, irregular incomes, that have to be managed with not suitable financial instruments, and how poor households cope with that. Irregularity and unpredictability of informal labor are addressed as causes for serious challenges in cash-flow management.

Similar insecurities, which exist in formal labor in South Asia, unlike in South Africa were labor laws allow households access more financial opportunities, are discussed as well. Authors as well talk about usual way to carry transactions with ‘informal’ partners, such as friends or relatives offering interest-free loans rather than formal institutions like banks or insurance companies. Because informal partners (close neighbors for example) are at hand, convenient and more flexible (no strict payment schedules) they become desirable cash management tools. Moreover transactions with friends, neighbors, relatives do not involve paperwork, eople are of the same culture, and there is little or no financial price to be paid. Authors however emphasize that it does not mean that poor households are happy with these financial instruments, mainly due to their unreliability, lack of privacy and transparency. Therefore in order to do more business with the poor the formal sector needs to draw attention to availability to offer loans that can be repaid in small weekly or monthly installments and with flexibility in payment schedules. Researchers also remind us about many unexpected events in life and how these diminish poor households’ chances to move out of poverty.

Here several problems are addressed: importance of getting protection (insurance), health issues, and again poor financial tools. Authors suggest that more limited, but cheaper insurance coverage would improve the situation. The diaries also reveal that financial instruments producing really big sums in a simple way – are missing in poor countries. However poor households need to finance the big things in life as well, therefore savings clubs, microfinance and formal assist poor households accumulate bigger sums.

These then have many positive features, but do not mean that poor should be left with them, because there is need for better, improved longer term ways to accumulate lump sums. Because the poor do need to transact often but do not have the saved assets on which to lean, it is important for microfinancial services to provide this for them in the context of loans and savings. Authors point out that poor would rather pay high interest rates but have flexible and reliable cash flows than pay low or zero rates but get trapped into cash flow structures that they cannot change or negotiate.

Later in the book researchers’ point out that Bangladesh’s microfinance industry continues to develop and more flexible ways of lending as well as savings accounts have improved financial services for the poor. The success of Grameen bank proves that it is possible to make it easier for poor households to manage their cash flows and accumulate large sums. Moreover, microfinance institutions can be defined as integrated money-management systems for poor households. The book presented some major facts to understand that people living on $2 a day maintain financial lives because they are poor not in spite of being poor.

Also poor households suffer from the irregularity and instability of their incomes and often timing does not help them. One of ways to ease this problem is to offer better financial services including more options for those living with the unpredictability of these income streams. There is an opportunity to understand finance tools and services from poor point of view and need to help them manage money on a day to day basis, build savings over the long term and borrow for all uses.

Economics VS environment(EX. How has the development of cities affected environment?)

Economics VS environment(EX. How has the development of cities affected environment?).

Economics VS environment(EX. How has the development of cities affected environment?)

Paper details The research question can be decided by yourself.(you can easily find suitable sources) 1)The content of research paper needs at least 7 pages. 2)I also need thesis statement and a outline of research paper. 3) 7 sources include one book source, one magazine source, two refereed research journals sources and three additional sources(you can choose from:internet-based sources, audio source, audiovisual source, newspaper source or authoritative sources approved by the instructor)

Essay Help “>Essay Help