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Quantifying the magnitude and severity of absolute poverty in the developing world in the mid-1980s

  • Ravallion, Martin
  • Datt, Gaurav
  • van de Walle, Dominique
  • Chan, Elaine

In counting the poor, and measuring the severity of absolute poverty, one faces a number of difficult questions. What poverty line should be used? Should one use the same poverty line across all countries? How should one adjust for differences across countries in the purchasing power of their currencies at official exchange rates? This paper proposes a methodology for addressing these questions and others, and gives aggregate results for 86 developing countries in the mid-1980s. The paper aims to make a necessarily rough but methodologically consistent assessment ofthe magnitude and severity of absolute poverty, based on recent available data. It suggests three possible interpretations of an"absolute poverty line"which might be considered appropriate for this purpose. It is followed by an empirical examination of poverty lines for a number of countries, both developing and developed. It discusses issues which arise in measuring poverty from readily available data on income distribution and outlines the approach used to measure poverty in countries for which such data are not available. The paper presents and discusses estimates of the prevalence and severity of absolute poverty in the developing countries in the mid-1980s. It also discusses some of the implications of these results, particularly their bearing on the prospects for future poverty alleviation.

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Paper provided by The World Bank in its series Policy Research Working Paper Series with number 587.

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Date of creation: 28 Feb 1991
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Handle: RePEc:wbk:wbrwps:587
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  1. Ravallion, Martin, 1991. "The challenging arithmetic of poverty in Bangladesh," Policy Research Working Paper Series 586, The World Bank.
  2. Blackburn, McKinley L., 1989. "Interpreting the magnitude of changes in measures of income inequality," Journal of Econometrics, Elsevier, vol. 42(1), pages 21-25, September.
  3. Datt, Gaurav & Ravallion, Martin, 1990. "Regional disparities, targeting, and poverty in India," Policy Research Working Paper Series 375, The World Bank.
  4. Villasenor, JoseA. & Arnold, Barry C., 1989. "Elliptical Lorenz curves," Journal of Econometrics, Elsevier, vol. 40(2), pages 327-338, February.
  5. Foster, James & Greer, Joel & Thorbecke, Erik, 1984. "A Class of Decomposable Poverty Measures," Econometrica, Econometric Society, vol. 52(3), pages 761-66, May.
  6. Kakwani, N C & Podder, N, 1973. "On the Estimation of Lorenz Curves from Grouped Observations," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 14(2), pages 278-92, June.
  7. Kapteyn, A.J. & Kooreman, P. & Willemse, R., 1987. "Some methodological issues in the implementation of subjective poverty definitions," Research Memorandum FEW 245, Tilburg University, School of Economics and Management.
  8. Berry, Albert & Bourguignon, Francois & Morrisson, Christian, 1983. "The Level of World Inequality: How Much Can One Say?," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 29(3), pages 217-41, September.
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