Abstract
AbstractPoverty lines are typically higher in richer countries, and lower in poorer ones, reflecting the relative nature of national assessments of who is considered poor. In many high-income countries, poverty lines are explicitly relative, set as a share of mean or median income. Despite systematic variation in how countries define poverty, global poverty counts are based on fixed-value lines. To reflect national assessments of poverty in a global headcount of poverty, this paper proposes a societal poverty line. The proposed societal poverty line is derived from 699 harmonized national poverty lines, has an intercept of $1 per day and a relative gradient of 50 percent of median national income or consumption. The societal poverty line is more closely aligned with national definitions of poverty than other proposed relative lines. By this relative measure, societal poverty has fallen steadily since 1990, but at a much slower pace than absolute extreme poverty.
Highlights
Most low- and middle-income countries define poverty as an inability to meet basic needs, typically defined by nutritional norms with an allowance for nonfood basic needs (Ravallion, 2010)
Borrowing language from Atkinson, we offer a “societal poverty line” (SPL) that builds on the work of Atkinson and Bourguignon (2001) and Ravallion and Chen (2011, 2013), but one that we argue is better aligned with national assessments of poverty in low, middle, and high-income countries
This economic gradient of the SPL corresponds with a view of relative poverty that is well accepted in much of the rich world and coincides with Sustainable Development Goals (SDGs) indicator 10.2.1 on inequality, which tracks the proportion of people living on less than 50 percent of median income
Summary
Most low- and middle-income countries define poverty as an inability to meet basic needs, typically defined by nutritional norms with an allowance for nonfood basic needs (Ravallion, 2010). Many countries have increased the real value of their national poverty lines, in recognition that their economies had grown so significantly that the concept of basic needs in their societies had fundamentally changed.. Many countries have increased the real value of their national poverty lines, in recognition that their economies had grown so significantly that the concept of basic needs in their societies had fundamentally changed.3 In these cases, the national absolute lines again behave like relative lines in that (over longer periods of time) they increase with economic growth. The slope of 50 percent adds a relative element to the SPL, rising in value as median consumption levels increase This economic gradient of the SPL corresponds with a view of relative poverty that is well accepted in much of the rich world and coincides with SDG indicator 10.2.1 on inequality, which tracks the proportion of people living on less than 50 percent of median income.. Including metadata and indicators, on each of the 17 SDGs, see http://unstats.un.org/sdgs/iaeg-sdgs/metadata-compilation/
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