What is the link between wealth and welfare Do governments h

What is the link between wealth and welfare? Do governments have a responsibility to address welfare?

Solution

Wealth refers to the monetary value of net assets and income earned and accumulated by an economic entity. Welfare relates to the increase in overall standard of living, including non-monetary standards.

In general it is presumed that higher wealth leads to higher welfare. However, that holds true only an an individual level - individuals raise their standard of living and higher welfare state, as they gather more wealth. But at an aggregative level, an overall nation\'s wealth doesn\'t define its welfare state.

That is why, the welfare programs are mostly undertaken by the government to ensure that the standard of living and overall welfare be raised for those sections of the society who cannot afford it. Governments spend a considerable portion of their GDP every year for welfare programs.