A New Measurement of Poverty

Abstract

Abstract In this chapter, the author summarizes the story of the Multidimensional Poverty Index (MPI) and the development of the methodology to calculate it (the Alkire–Foster method) by Sabina Alkire and James Foster at the University of Oxford between 2006 and 2007. He also describes how the Oxford Poverty and Human Development Initiative (OPHI) promoted the MPI. This index is based on the economic theories of Professor Amartya Sen. The author recounts how Mexico was the first country to develop a multidimensional poverty measure and how Colombia and Bhutan, almost simultaneously, were the first countries to adopt an MPI fully based on the Alkire–Foster method. As background to the MPI, the author cites the concept of unsatisfied basic needs (UBN), developed by Óscar Altimir at the Economic Commission for Latin America and the Caribbean (ECLAC), in addition to other instruments used in Colombia for measuring and monitoring families’ living conditions such as the Living Conditions Index (LCI) and the SISBEN. In 2008, economists at Colombia’s National Planning Department (DNP in Spanish), led by Roberto Angulo, began to study the new MPI created at Oxford, and, in 2009, the Colombian government convened the Mission for the Splicing of Employment, Poverty, and Inequality Series (MESEP in Spanish), which recommended adopting it. Jointly, in 2010, the DNP and OPHI began working to construct an MPI for Colombia (C-MPI).