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Measuring vulnerability to poverty: a unified framework

In: Research Handbook on Measuring Poverty and Deprivation

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Listed:
  • Indranil Dutta
  • Ajit Mishra

Abstract

The focus of this chapter is on understanding the impacts of shocks on income, both at the individual and societal level. The chapter mainly discusses conceptual issues around measuring vulnerability along with suggestions for empirical methods to estimate the level of vulnerability. The chapter adapts the existing literature in poverty measurement and decision making under uncertainty to measuring vulnerability to poverty. Specifically, a three step process is employed where first the vulnerable are identified, second the vulnerability of each individual in the society is calculated and finally the vulnerability across all individuals is aggregated to estimate the societal vulnerability. In this framework vulnerability is conceptualized as arising out of different shocks which makes it more intuitive and appealing. The chapter also provides a broad theoretical framework to assess vulnerability under different information.

Suggested Citation

  • Indranil Dutta & Ajit Mishra, 2023. "Measuring vulnerability to poverty: a unified framework," Chapters, in: Jacques Silber (ed.), Research Handbook on Measuring Poverty and Deprivation, chapter 48, pages 523-534, Edward Elgar Publishing.
    • Handle: RePEc:elg:eechap:20574_48
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    References listed on IDEAS

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    1. Cesar Calvo & Stefan Dercon, 2013. "Vulnerability to individual and aggregate poverty," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, vol. 41(4), pages 721-740, October.
    2. World Bank, 2020. "Poverty and Shared Prosperity 2020," World Bank Publications - Books, The World Bank Group, number 34496.
    3. Hai‐Anh H. Dang & Peter F. Lanjouw, 2017. "Welfare Dynamics Measurement: Two Definitions of a Vulnerability Line and Their Empirical Application," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 63(4), pages 633-660, December.
    4. Satya R. Chakravarty, 2019. "A New Index of Poverty," Themes in Economics, in: Satya R. Chakravarty (ed.), Poverty, Social Exclusion and Stochastic Dominance, pages 31-37, Springer.
    5. Foster, James E, 1998. "Absolute versus Relative Poverty," American Economic Review, American Economic Association, vol. 88(2), pages 335-341, May.
    6. Indranil Dutta & James Foster & Ajit Mishra, 2011. "On measuring vulnerability to poverty," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, vol. 37(4), pages 743-761, October.
    7. Maike Hohberg & Katja Landau & Thomas Kneib & Stephan Klasen & Walter Zucchini, 2018. "Vulnerability to poverty revisited: Flexible modeling and better predictive performance," The Journal of Economic Inequality, Springer;Society for the Study of Economic Inequality, vol. 16(3), pages 439-454, September.
    8. Sen, Amartya K, 1976. "Poverty: An Ordinal Approach to Measurement," Econometrica, Econometric Society, vol. 44(2), pages 219-231, March.
    9. Ward, Patrick S., 2016. "Transient Poverty, Poverty Dynamics, and Vulnerability to Poverty: An Empirical Analysis Using a Balanced Panel from Rural China," World Development, Elsevier, vol. 78(C), pages 541-553.
    10. Gloede, Oliver & Menkhoff, Lukas & Waibel, Hermann, 2015. "Shocks, Individual Risk Attitude, and Vulnerability to Poverty among Rural Households in Thailand and Vietnam," World Development, Elsevier, vol. 71(C), pages 54-78.
    11. Katsushi Imai & Raghav Gaiha & Woojin Kang, 2011. "Vulnerability and poverty dynamics in Vietnam," Applied Economics, Taylor & Francis Journals, vol. 43(25), pages 3603-3618.
    12. Foster, James E & Shorrocks, Anthony F, 1991. "Subgroup Consistent Poverty Indices," Econometrica, Econometric Society, vol. 59(3), pages 687-709, May.
    13. Rasmus Heltberg & Niels Lund, 2009. "Shocks, Coping, and Outcomes for Pakistan's Poor: Health Risks Predominate," Journal of Development Studies, Taylor & Francis Journals, vol. 45(6), pages 889-910.
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    More about this item

    Keywords

    Development Studies; Economics and Finance; Geography; Research Methods; Sociology and Social Policy;
    All these keywords.

    JEL classification:

    • D80 - Microeconomics - - Information, Knowledge, and Uncertainty - - - General
    • I32 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Measurement and Analysis of Poverty
    • O12 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Microeconomic Analyses of Economic Development

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