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Measuring Vulnerability to Poverty: A Unified Framework

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Listed:
  • Indranil Dutta
  • Ajit Mishra

Abstract

In this paper, we provide an unified analytical framework to measure vulnerability to poverty. We conceptualise vulnerability as arising out of different shocks which makes it more intuitive and appealing. Our focus is on understanding impacts of shocks on income, both at the individual and societal level. We will mainly discuss conceptual issues around measuring vulnerability along with suggestions for empirical methods to estimate the level of vulnerability. We combine the literature on poverty measurement and decision making under uncertainty to provide a novel way of understanding and measuring vulnerability to poverty. Specifically, we employ a three step process where we first identify the vulnerable, second we calculate the vulnerability of each individual in the society and finally aggregate the vulnerability across all individuals to estimate the societal vulnerability. Our proposals also provide a broad theoretical framework to assess vulnerability under different information constraints.

Suggested Citation

  • Indranil Dutta & Ajit Mishra, 2023. "Measuring Vulnerability to Poverty: A Unified Framework," Economics Discussion Paper Series 2301, Economics, The University of Manchester.
    • Handle: RePEc:man:sespap:2301
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    References listed on IDEAS

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    More about this item

    Keywords

    poverty; vulnerability; uncertainty;
    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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