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On Measuring Global Poverty

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  • Martin Ravallion

Abstract

This article critically assesses prevailing measures of global poverty. A welfarist interpretation of global poverty lines is augmented by the idea of normative functionings, the cost of which varies across countries. In this light, current absolute measures are seen to ignore important social effects on welfare, while popular, strongly relative measures ignore absolute levels of living. It is argued that a new hybrid measure is called for, combining absolute and weakly relative measures consistent with how national lines vary across countries. Illustrative calculations indicate that we are seeing a falling incidence of poverty globally over the past 30 years. This is mainly due to lower absolute poverty counts in the developing world. While fewer people are poor by the global absolute standard, more are poor by the country-specific relative standard. The vast bulk of poverty, both absolute and relative, is now found in the developing world.

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  • Martin Ravallion, 2020. "On Measuring Global Poverty," Annual Review of Economics, Annual Reviews, vol. 12(1), pages 167-188, August.
  • Handle: RePEc:anr:reveco:v:12:y:2020:p:167-188
    DOI: 10.1146/annurev-economics-081919-022924
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    9. Chen, Shaohua & Ravallion, Martin, 2021. "Reconciling the conflicting narratives on poverty in China," Journal of Development Economics, Elsevier, vol. 153(C).
    10. Decerf,Benoit Marie A, 2022. "Absolute and Relative Poverty Measurement : A Survey," Policy Research Working Paper Series 10008, The World Bank.
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    12. Dang, Hai-Anh H. & Abanokova, Kseniya & Lokshin, Michael M., 2020. "Life Satisfaction, Subjective Wealth, and Adaptation to Vulnerability in the Russian Federation during 2002-2017," GLO Discussion Paper Series 492, Global Labor Organization (GLO).
    13. Kym Anderson, 2021. "Food policy in a more volatile climate and trade environment," Departmental Working Papers 2021-25, The Australian National University, Arndt-Corden Department of Economics.
    14. Schneider, Kate R., 2022. "Nationally representative estimates of the cost of adequate diets, nutrient level drivers, and policy options for households in rural Malawi," Food Policy, Elsevier, vol. 113(C).
    15. Schneider, Kate, 2021. "Nationally Representative Estimates of the Cost of Adequate Diets, Nutrient Level Drivers, and Policy Options for Households in Rural Malawi," 2021 Conference, August 17-31, 2021, Virtual 315035, International Association of Agricultural Economists.
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    21. Decerf,Benoit Marie A & Ferrando,Mery & Quinn,Natalie N., 2021. "Fair and Welfare-Consistent Global Income Poverty Measurement : Theory and Application," Policy Research Working Paper Series 9844, The World Bank.

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    JEL classification:

    • I32 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Measurement and Analysis of Poverty
    • O1 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development

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