A shanty town is a slum

Slum

A slum, as defined by United Nations agency UN-HABITAT, is a run-down area of a city characterized by substandard housing and squalor and lacking in tenure security. According to the United Nations, the percentage of urban dwellers living in slums decreased from 47 percent to 37 percent in the...

 settlement (sometimes illegal or unauthorized) of impoverished people who live in improvised dwellings made from scrap materials: often plywood

Plywood

Plywood is a type of manufactured timber made from thin sheets of wood veneer. It is one of the most widely used wood products. It is flexible, inexpensive, workable, re-usable, and can usually be locally manufactured...

, corrugated metal

Corrugated galvanised iron

Corrugated galvanised iron is a building material composed of sheets of hot-dip galvanised mild steel, cold-rolled to produce a linear corrugated pattern in them...

 and sheets of plastic. Shanty towns, which are usually built on the periphery of cities, often do not have proper sanitation, electricity or telephone services.

Shanty towns are mostly found in developing nations, or partially developed nations with an unequal distribution of wealth

Economic inequality

Economic inequality comprises all disparities in the distribution of economic assets and income. The term typically refers to inequality among individuals and groups within a society, but can also refer to inequality among countries. The issue of economic inequality is related to the ideas of...

.