The Concept of Poverty: Principles and Practice

1
The Concept of PovertyPrinciples and Practice

• Peter Lanjouw
• DECRG

2
Why Measure Poverty?

• To Inform Decision Making
• To Encourage Public Attention and Debate
• Conclusion Poverty Measurement is essential for
  sound policy making and can keep poverty in the
  public eye

3
What is Involved?

• Poverty Measurement is concerned with poverty
  comparisons
• Comparing the poverty of persons or groups of
  people
• Comparing the evolution of poverty over time or
  across countries
• These different purposes have different
  implications for how to measure poverty
• Conclusion The purpose should drive the
  mechanics

4
The Mechanics

• Selecting an indicator of welfare
• Income
• Consumption
• Other indicators of human development
• Achieving comparability
• Price variation
• Equivalence scales
• Conclusion A sound basis is needed

5
Deriving a Poverty Line

• Absolute versus relative
• Selecting an objective poverty line
• Subjective poverty lines

6
Measuring Poverty

• Choosing Poverty Measures
• Poverty Measures of Poverty Profile?
• Cardinal versus ordinality
• Robustness and Sensitivity Analysis