Poverty: hunger = poverty (poor can a ord to eat in modern day)
Measuring poverty: despite this, many countries use income based poverty lines that supposedly
re ect basic food needs (less than $2.50 adjusted for PPP- based on basket of goods)
- poverty headcount(H): no of people livin. Under poverty line(Y): Headcount index(H/Y) :
fraction of total pop under poverty line.
- total poverty gap(TPG): measures total income necessary to raise all those below poverty
. line above it. (Takes account depth of poverty)
- it does not get manipulated through income transfers amongst the poor.
- measured Per capita: Average poverty gap = (TPG)/N (measures severity of .
. Poverty)
Criticisms of poverty measures: H & TPG heavily rely on income as measure of poverty.
Poverty is inherited a multidimensional concept. The capabilities approach is a justi cation for
multidimensional measure of poverty. (If one has enough goods, the goods still have low worth if they
don’t have capabilities to enjoy them)
Other measures of poverty:
MPI- Multidimensional Poverty Index: multidimensional head count x poverty intensity (H x A)
-built on household survey data (measures individually if people are poor or not)
-varies between 0-1 (0=not poor, 1=very poor)
-10 separate deprivation indicators (with 3 dimensions: education, health, standard of living)
each dimension adds up to 1/3 of the indicator
And each deprivation indicator has a score (yes =1*1/x, no = 0*1/x) x is either 6, 18 …
Then all the deprivations indicators get added up into 1 deprivations score. (If score 0.3< then .
. considered poor)
Multidimensional headcount ratio(H): no. Of multidimensional poor/ total population
Poverty intensity(A): Average deprivation score of ppl classi ed as poor (score 0.3<)
MPI links to SDG: 1,2,3,4,6,7 and 11
Progressive tax : taxing higher income earners in the economy
Regressive tax : taxing lower income earners in the economy
Nutrition-based poverty trap: (graph shows yes) hunger->low productivity->hunger (viscous circle)
Economic Growth and reducing poverty
ff
Measuring poverty: despite this, many countries use income based poverty lines that supposedly
re ect basic food needs (less than $2.50 adjusted for PPP- based on basket of goods)
- poverty headcount(H): no of people livin. Under poverty line(Y): Headcount index(H/Y) :
fraction of total pop under poverty line.
- total poverty gap(TPG): measures total income necessary to raise all those below poverty
. line above it. (Takes account depth of poverty)
- it does not get manipulated through income transfers amongst the poor.
- measured Per capita: Average poverty gap = (TPG)/N (measures severity of .
. Poverty)
Criticisms of poverty measures: H & TPG heavily rely on income as measure of poverty.
Poverty is inherited a multidimensional concept. The capabilities approach is a justi cation for
multidimensional measure of poverty. (If one has enough goods, the goods still have low worth if they
don’t have capabilities to enjoy them)
Other measures of poverty:
MPI- Multidimensional Poverty Index: multidimensional head count x poverty intensity (H x A)
-built on household survey data (measures individually if people are poor or not)
-varies between 0-1 (0=not poor, 1=very poor)
-10 separate deprivation indicators (with 3 dimensions: education, health, standard of living)
each dimension adds up to 1/3 of the indicator
And each deprivation indicator has a score (yes =1*1/x, no = 0*1/x) x is either 6, 18 …
Then all the deprivations indicators get added up into 1 deprivations score. (If score 0.3< then .
. considered poor)
Multidimensional headcount ratio(H): no. Of multidimensional poor/ total population
Poverty intensity(A): Average deprivation score of ppl classi ed as poor (score 0.3<)
MPI links to SDG: 1,2,3,4,6,7 and 11
Progressive tax : taxing higher income earners in the economy
Regressive tax : taxing lower income earners in the economy
Nutrition-based poverty trap: (graph shows yes) hunger->low productivity->hunger (viscous circle)
Economic Growth and reducing poverty
ff
