Causes of Global Inequality

Why are some countries wealthy while others remain trapped in poverty? This is one of the most important questions in geography. The answer is never simple — inequality is the result of a complex web of physical, historical, economic, and political factors that interact and reinforce each other over time. This lesson examines each category in detail, with specific examples from around the world.

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Physical Factors

The physical geography of a country can either help or hinder its development. While physical factors alone do not determine a country's level of development, they create advantages or disadvantages that shape opportunities.

Climate

• Countries in tropical regions often face challenges including extreme heat, heavy rainfall, and the prevalence of diseases such as malaria, dengue fever, and sleeping sickness
• These conditions reduce agricultural productivity and worker health
• Temperate climates (e.g., Western Europe) are more conducive to productive agriculture and comfortable working conditions
• However, climate alone does not determine development — Singapore is tropical yet highly developed

Natural Resources

• Countries with valuable natural resources (oil, gas, minerals, fertile land) have a potential source of wealth
• Examples: Saudi Arabia and Qatar have used oil wealth to achieve very high GNI per capita
• However, resources can also be a curse — the resource curse (or "paradox of plenty") describes how resource-rich countries can actually suffer from slower growth due to corruption, conflict over resources, and neglect of other economic sectors
• Democratic Republic of Congo (DRC) has vast mineral wealth (coltan, cobalt, diamonds) but remains one of the world's poorest countries due to conflict and exploitation

Natural Hazards

• Countries in hazard-prone areas face repeated destruction of infrastructure, housing, and crops
• Haiti is regularly hit by earthquakes and hurricanes, diverting resources from development to disaster recovery
• The 2010 Haiti earthquake killed over 220,000 people and caused $8 billion in damage — equivalent to over 120% of the country's GDP
• Bangladesh faces annual flooding and cyclone damage, with the 1991 cyclone killing approximately 138,000 people

Landlocked Countries

• Countries without access to the sea face higher transport costs for trade
• 15 of the world's 20 poorest countries are landlocked (e.g., Niger, Chad, Burkina Faso, Malawi)
• They must rely on neighbouring countries' infrastructure to access ports, making them vulnerable to political instability in those nations
• Transport costs can be 50–100% higher for landlocked countries compared to coastal neighbours

Exam Tip: Physical factors create the conditions, but they do not determine development. Always link physical factors to human responses — how people and governments respond to physical challenges matters just as much.

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Historical Factors

The history of a country — particularly its experience of colonialism — has a profound and lasting impact on its development.

Colonialism

Between the 16th and 20th centuries, European powers (Britain, France, Spain, Portugal, Netherlands, Belgium, Germany) colonised large parts of Africa, Asia, and the Americas. The effects of colonialism include:

Impact	Explanation	Example
Resource extraction	Colonial powers extracted raw materials (minerals, timber, crops) and sent them to Europe, with little reinvestment in the colony	Belgium extracted rubber, ivory, and minerals from Congo; profits went to Belgium
Arbitrary borders	Colonial boundaries were drawn with no regard for ethnic, linguistic, or cultural groups, creating countries with internal tensions	Nigeria contains over 250 ethnic groups forced into one nation by British colonial borders
Destruction of local industry	Colonies were forced to export raw materials and import manufactured goods from the colonial power, preventing industrialisation	India's textile industry was deliberately destroyed by British colonial policy
Limited education	Colonial powers invested little in education for local populations, creating a skills gap that persists today	In 1960, the DRC had fewer than 30 university graduates at independence
Infrastructure for extraction	Railways and roads were built to transport resources to ports, not to connect communities or stimulate local trade	Many African railway networks still run from mines to ports, with few cross-country links

The Slave Trade

The transatlantic slave trade (16th–19th century) had devastating effects on West African development:

• An estimated 12.5 million Africans were forcibly transported to the Americas
• This drained the continent of its most productive workers
• It created a legacy of underdevelopment, depopulation, and social disruption
• Profits from the slave trade funded industrialisation in Europe and North America

Exam Tip: When discussing colonialism in an exam, always give specific examples and explain how the historical impact continues to affect development today. Making the link between past and present is essential for top marks.

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Economic Factors

The global economic system creates significant advantages for some countries and disadvantages for others.

Unfair Trade

• Many LICs are dependent on exporting primary products (raw materials, crops, minerals)
• Primary product prices are volatile — they fluctuate unpredictably on world markets
• The terms of trade often disadvantage LICs: they export cheap raw materials and import expensive manufactured goods
• Trade barriers (tariffs and subsidies) in HICs make it harder for LIC products to compete

graph LR
    A[LIC exports raw cocoa beans] -->|Low price: $2,000/tonne| B[HIC processes into chocolate]
    B -->|High price: $20,000/tonne| C[Sold worldwide]
    C -->|Profit stays in HIC| D[Wealth gap widens]
    A -->|LIC receives tiny share of final value| E[Cycle of poverty continues]

Debt

• Many LICs borrowed heavily in the 1970s and 1980s, often from HIC governments or international banks
• Interest payments can consume a large proportion of government revenue, leaving less for healthcare, education, and infrastructure
• In 2000, some African countries were spending more on debt repayment than on healthcare and education combined
• The Heavily Indebted Poor Countries (HIPC) Initiative has provided some relief, but many countries remain burdened by debt

Corruption

• Corruption diverts public funds away from development priorities
• Transparency International's Corruption Perceptions Index consistently shows that many of the world's poorest countries also have the highest levels of corruption
• Example: In Equatorial Guinea, vast oil revenues have enriched the ruling elite while most of the population lives in poverty — despite a GNI per capita that is theoretically one of the highest in Africa

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Political Factors

Political instability, conflict, and poor governance are major barriers to development.

Conflict

• War and civil conflict destroy infrastructure, displace populations, disrupt education, and divert spending to military purposes
• Syria — the civil war (2011–present) has reduced GDP by over 60%, displaced 13 million people, and destroyed healthcare and education systems
• South Sudan — civil war since 2013 has created famine, displaced 4 million people, and left the country with one of the lowest HDIs in the world (0.385)
• Countries recovering from conflict face a "poverty trap" — they lack the resources to rebuild, which perpetuates instability

Poor Governance

• Weak institutions, lack of rule of law, and absence of democracy can undermine development
• Without secure property rights, people are reluctant to invest in businesses or land
• Without independent courts, contracts cannot be enforced reliably
• Without transparent government, resources are misallocated

Brain Drain

• When skilled workers (doctors, engineers, teachers) emigrate to HICs in search of better pay and conditions, it leaves LICs with a critical shortage of trained professionals
• An estimated 70,000 skilled professionals leave Africa each year
• This makes it harder for LICs to improve healthcare, education, and economic productivity