How Should We Measure Poverty in a Changing World? Methodological Issues and Chinese Case Study
This study asks whether, in a rapidly changing world, the estimated proportion of the world's population with income below US$1 (adjusted according to purchasing power parity) per day is still a good measure of trends in poverty. It argues that strong economic growth in nations such as China implies that the commonly accepted international poverty line definition of one half median national equivalent income is increasingly relevant and that poverty intensity (the normalized deficit or Foster-Greer-Thorbecke (FGT) index of order one) is a better summary index. This index has a convenient graphical representation-the "poverty box". Using the proposed poverty line and the example of ranking the level of rural poverty in Chinese provinces, the study demonstrates how poverty intensity replicates the poverty rankings of the Sen family of poverty indices and captures most of the information content of higher-order FGT indices. Copyright � 2008 The Authors.
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Volume (Year): 12 (2008)
Issue (Month): 2 (05)
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References listed on IDEAS
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- Sen, Amartya K, 1976. "Poverty: An Ordinal Approach to Measurement," Econometrica, Econometric Society, vol. 44(2), pages 219-31, March.
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- Subramanian, S., 2005. "Poverty Measurement and Theories of Beneficence," Working Paper Series RP2005/62, World Institute for Development Economic Research (UNU-WIDER).
- Jenkins, Stephen P & Lambert, Peter J, 1997. "Three 'I's of Poverty Curves, with an Analysis of UK Poverty Trends," Oxford Economic Papers, Oxford University Press, vol. 49(3), pages 317-27, July.
- Michael F. Förster & Marco Mira d'Ercole, 2005. "Income Distribution and Poverty in OECD Countries in the Second Half of the 1990s," OECD Social, Employment and Migration Working Papers 22, OECD Publishing.
- Lars Osberg, 2000. "Poverty in Canada and the United States: measurement, trends, and implications," Canadian Journal of Economics, Canadian Economics Association, vol. 33(4), pages 847-877, November.
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