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It is important for us to understand the cause of poverty

No. There are no causes of poverty. It is the rest state, that which happens when you don’t do anything. If you want to experience poverty, just do nothing and it will come. To ask what causes poverty is like asking what causes cold in the universe; it is the absence of energy. Similarly poverty is the absence of wealth. For most of humanity’s existence on this planet, poverty has been the norm, the natural condition. People hunted to survive or lived by subsistence farming, and they were poor. In some parts of the world (like remote villages in Nepal and other underdeveloped countries) this is still the case.

The unusual condition is wealth. This is what changes things. We should ask, “What are the causes of wealth” and try to recreate and reproduce them. When you ask the wrong question, “What causes poverty,” you end up with wrong answers. People fall into the trap of thinking that the wealth of some causes the poverty in others; as if there were fixed amounts of wealth in the world and that rich people had seized too large a share of it.

In fact wealth is created, and it is only during the last 250 years or so that we have found how to do this on a grand scale. Wealth is created by production and enterprise, by the specialization of labour, and most of all it is created by exchange. Instead of trying to take wealth away from rich people and redistribute it, we should be seeking to implement the conditions in which as many people as possible can join in the wealth-creating process for themselves.

Poor countries will not become wealthier because we give them some of our riches. They will climb out of poverty the same way we did, by producing and selling goods and services and by creating wealth in the process.

Edited by Sakin and Written by Dr Madsen Pirie

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Author: sakinshrestha

Hello. My name is Sakin Shrestha, and I am a technology entrepreneur from Nepal. I am passionate about helping this sector grow, for many reasons. The technology sector creates jobs for many young Nepalis who would otherwise migrate to foreign countries. It lets Nepali professionals develop skills for a fast-changing global workplace, and compete at a high level with anyone, anywhere in the world. If it grows, it will provide a viable career option for many young Nepalis, and help us reap the benefits of a global economy.