In today’s globalised world, people are exposed to both opportunities and challenges.
Globalisation is the result of new technologies, growth market and expanding trades, however, not everyone will benefit from these as there are still who suffers from poverty and social inequality.
In shared prosperity, the main objective is to end poverty by increasing the incomes and welfare of the bottom 40 percent of society.
To achieve this, there are several elements needed by any country to achieve shared prosperity.
Economic growth
Without economic growth, the living standards of the less well-off are unlikely to increase
Economic growth is also important because it generates more employment for broad segments of the population.
In some parts of the world, the private sector is the main job creator, but the government plays a critical role in implanting policies that promotes a favourable environment by investing in the labour skills needed to create a dynamic workforce.
However, the pattern of growth has to be such that it generates income opportunities for the poor. So the poverty impact of natural resources-based growth that does not pull the rest of the economy will be very different than growth sustained by agricultural productivity increases, for example.
Equal Opportunities
To foster shared prosperity, it requires ensuring equality of opportunity to all people.
This includes both children and male adults and women.
For children as well as the youths, this means providing universal healthcare, easy access to education, imparting the necessary skills, nutrition as well as basic infrastructures for aspiring entrepreneurs.
This is important to build human capital and increase productivity in the workforce in the future.
As for women, this means ensuring equal opportunity with men by knocking down barriers to their participation in various sectors such as economic, social and politics.
In ensuring equal opportunity for all, according to a research paper by the World Bank, it stated that that “Efforts to improve and equalise opportunities would lead to immediate rise in welfare along multiple (including non-monetary) dimensions particularly among the poor and the excluded. Over long term, it would also promote social mobility, reduce income inequality and enhance economic dynamism and prosperity for the economy as a whole”.
Corruption
The World Bank has noted that corruption is one of the single largest obstacles to development.
Corruption has a huge impact on the poor and most vulnerable by increasing costs and reducing access to services, including health, education, and justice.
Equal opportunities for all in various sectors
In ensuring shared prosperity, the government should ensure that growth is diversified across multiple sectors.
Economic growth can ensure improvement in living standards of bottom 40 per cent of population if it is broad based and generates a lot of opportunities for better quality jobs or gainful employment for all sections of the population.
This can be done by ensure improving competitiveness by preventing monopolies in the production of goods and services, adequate creation of jobs, encourage innovations or technological changes that are labour-absorptive rather than labour-displacing.
Apart from that, investment should also be made in social institutions to ensure equal opportunities for all sections of the society.
The World Bank Group noted that rather than emphasizing on redistributing resources from one section of the society to another, the investment should be made for improving the capabilities of the people that increases their productivity and therefore promote growth and equity over time and across generations.
