New global poverty counts

Poverty assessment methods need re-thinking

By: Kakwani, N. & Son, H.H.
Published by: UNDP International Poverty Centre (IPC) , 2006
Via: Eldis

Accurate global poverty estimates are fundamental to the effectiveness of monitoring changes over time and the targeting of poverty reduction efforts. The accuracy of the dollar-a-day measure has recently been called in to question, and there is a pressing need for a more robust method which takes into account a number of basic human needs. The main aim of this study is to compute an international poverty threshold based on the food requirement to ensure adequate calorie intake for the world's poorest. The study proposes a new methodology based on consumer theory to provide calorie-based international poverty thresholds.

Using a sample of 15 sub-Saharan African and 4 Asian countries, the new methodology enables the authors to arrive at a poverty line of $1.50, compared to the World Bank's figure of $1.08. This translates into a global poverty rate of 1.9 billion people - considerably higher than the 1.1 billion reported by the Bank. The study also provides global estimates of hunger. A person is defined as suffering from hunger if they do not have the means to meet their own basic food needs. According to this definition, there are 678 million sufferers of hunger globally. These calculations suggest that such poverty measures require significant improvement. The World Bank in particular needs to adjust its poverty counts if it is to accurately reflect the international poverty situation.