[go: up one dir, main page]

IDEAS home Printed from https://ideas.repec.org/p/ess/wpaper/id7753.html
   My bibliography  Save this paper

Toward Better Global Poverty Measures

Author

Listed:
  • Martin Ravallion
Abstract
While much progress has been made over the last 25 years in measuring global poverty, there are a number of challenges ahead. The paper discusses three sets of problems: (i) how to allow for social effects on welfare, recognizing the identification issues involved; (ii) the need to monitor progress in raising the consumption floor above its biological level, in addition to counting the number of people living near the floor; and (iii) addressing the longstanding concerns about prevailing approaches to making inter-country comparisons of price levels facing poor people. Some suggestions are offered for operational solutions, building on past research.

Suggested Citation

  • Martin Ravallion, 2015. "Toward Better Global Poverty Measures," Working Papers id:7753, eSocialSciences.
  • Handle: RePEc:ess:wpaper:id:7753
    Note: Institutional Papers
    as

    Download full text from publisher

    File URL: http://www.esocialsciences.org/Download/repecDownload.aspx?fname=A20151116113759_20.pdf&fcategory=Articles&AId=7753&fref=repec
    Download Restriction: no
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Fleurbaey,Marc & Maniquet,François, 2011. "A Theory of Fairness and Social Welfare," Cambridge Books, Cambridge University Press, number 9780521715348, September.
    2. Nanak Kakwani & Hyun H. Son, 2016. "Global poverty estimates based on 2011 purchasing power parity: where should the new poverty line be drawn?," The Journal of Economic Inequality, Springer;Society for the Study of Economic Inequality, vol. 14(2), pages 173-184, June.
    3. Ahluwalia, Montek S. & Carter, Nicholas G. & Chenery, Hollis B., 1979. "Growth and poverty in developing countries," Journal of Development Economics, Elsevier, vol. 6(3), pages 299-341, August.
    4. World Bank, 2008. "Global Purchasing Power Parities and Real Expenditures : 2005 International Comparison Program," World Bank Publications - Books, The World Bank Group, number 21558.
    5. repec:pri:rpdevs:deaton_price_indexes_inequality_and_the_measurement_of_world_poverty_aer. is not listed on IDEAS
    6. Jolliffe, Dean & Prydz, Espen Beer, 2015. "Global Poverty Goals and Prices: How Purchasing Power Parity Matters," IZA Discussion Papers 9064, Institute of Labor Economics (IZA).
    7. Peter Edward & Andy Sumner, 2015. "New estimates of global poverty and inequality: How much difference do price data," Working Papers 365, ECINEQ, Society for the Study of Economic Inequality.
    8. Shaohua Chen & Martin Ravallion, 2013. "More Relatively-Poor People in a Less Absolutely-Poor World," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 59(1), pages 1-28, March.
    9. Robert J. Hill, 2004. "Constructing Price Indexes across Space and Time: The Case of the European Union," American Economic Review, American Economic Association, vol. 94(5), pages 1379-1410, December.
    10. Francisco H. G. Ferreira & Shaohua Chen & Andrew Dabalen & Yuri Dikhanov & Nada Hamadeh & Dean Jolliffe & Ambar Narayan & Espen Beer Prydz & Ana Revenga & Prem Sangraula & Umar Serajuddin & Nobuo Yosh, 2016. "A global count of the extreme poor in 2012: data issues, methodology and initial results," The Journal of Economic Inequality, Springer;Society for the Study of Economic Inequality, vol. 14(2), pages 141-172, June.
    11. Foster, James & Greer, Joel & Thorbecke, Erik, 1984. "A Class of Decomposable Poverty Measures," Econometrica, Econometric Society, vol. 52(3), pages 761-766, May.
    12. Milton Friedman, 1957. "Introduction to "A Theory of the Consumption Function"," NBER Chapters, in: A Theory of the Consumption Function, pages 1-6, National Bureau of Economic Research, Inc.
    13. Ingvild Almas, 2012. "International Income Inequality: Measuring PPP Bias by Estimating Engel Curves for Food," American Economic Review, American Economic Association, vol. 102(2), pages 1093-1117, April.
    14. Stephan Klasen & Tatyana Krivobokova & Friederike Greb & Rahul Lahoti & Syamsul Hidayat Pasaribu & Manuel Wiesenfarth, 2016. "International income poverty measurement: which way now?," The Journal of Economic Inequality, Springer;Society for the Study of Economic Inequality, vol. 14(2), pages 199-225, June.
    15. Peter Edward and Andy Sumner, 2015. "New Estimates of Global Poverty and Inequality: How Much Difference Do Price Data Really Make? - Working Paper 403," Working Papers 403, Center for Global Development.
    16. Martin Ravallion & Shaohua Chen, 2011. "Weakly Relative Poverty," The Review of Economics and Statistics, MIT Press, vol. 93(4), pages 1251-1261, November.
    17. Erzo F. P. Luttmer, 2005. "Neighbors as Negatives: Relative Earnings and Well-Being," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 120(3), pages 963-1002.
    18. Abhijit V. Banerjee & Esther Duflo, 2007. "The Economic Lives of the Poor," Journal of Economic Perspectives, American Economic Association, vol. 21(1), pages 141-168, Winter.
    19. Bruce E. Hansen, 2000. "Sample Splitting and Threshold Estimation," Econometrica, Econometric Society, vol. 68(3), pages 575-604, May.
    20. Foster, James E, 1998. "Absolute versus Relative Poverty," American Economic Review, American Economic Association, vol. 88(2), pages 335-341, May.
    21. Angus Deaton, 2010. "Price Indexes, Inequality, and the Measurement of World Poverty," American Economic Review, American Economic Association, vol. 100(1), pages 5-34, March.
    22. Ravallion, Martin, 2016. "The Economics of Poverty: History, Measurement, and Policy," OUP Catalogue, Oxford University Press, number 9780190212773.
    23. repec:pri:rpdevs:presidential%20address%2017january%202010%20all.pdf is not listed on IDEAS
    24. Martin Ravallion & Shaohua Chen & Prem Sangraula, 2009. "Dollar a Day Revisited," The World Bank Economic Review, World Bank, vol. 23(2), pages 163-184, June.
    25. Nanak Kakwani & Hyun H. Son, 2016. "Global poverty estimates based on 2011 purchasing power parity: where should the new poverty line be drawn?," The Journal of Economic Inequality, Springer;Society for the Study of Economic Inequality, vol. 14(2), pages 173-184, June.
    26. Angus Deaton & Bettina Aten, 2017. "Trying to Understand the PPPs in ICP 2011: Why Are the Results So Different?," American Economic Journal: Macroeconomics, American Economic Association, vol. 9(1), pages 243-264, January.
    27. Angus Deaton & Olivier Dupriez, 2011. "Purchasing Power Parity Exchange Rates for the Global Poor," American Economic Journal: Applied Economics, American Economic Association, vol. 3(2), pages 137-166, April.
    28. Martin Ravallion & Gaurav Datt & Dominique van de Walle, 1991. "Quantifying Absolute Poverty In The Developing World," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 37(4), pages 345-361, December.
    29. Moatsos Michail, 2016. "Global Absolute Poverty: Behind the Veil of Dollars," Journal of Globalization and Development, De Gruyter, vol. 7(2), pages 1-28, December.
    30. Lindgren, Mattias, 2015. "The elusive quest for the subsistence line How much does the cost of survival vary between populations?," MPRA Paper 73891, University Library of Munich, Germany.
    31. Bela Balassa, 1964. "The Purchasing-Power Parity Doctrine: A Reappraisal," Journal of Political Economy, University of Chicago Press, vol. 72(6), pages 584-584.
    32. John Gibson & Trinh Le & Bonggeun Kim, 2017. "Prices, Engel Curves, and Time-Space Deflation: Impacts on Poverty and Inequality in Vietnam," The World Bank Economic Review, World Bank, vol. 31(2), pages 504-530.
    33. Sen, Amartya, 1983. "Poor, Relatively Speaking," Oxford Economic Papers, Oxford University Press, vol. 35(2), pages 153-169, July.
    34. Angus Deaton & Alan Heston, 2010. "Understanding PPPs and PPP-Based National Accounts," American Economic Journal: Macroeconomics, American Economic Association, vol. 2(4), pages 1-35, October.
    35. Sen, Amartya, 1985. "A Sociological Approach to the Measurement of Poverty: A Reply [Poor, Relatively Speaking]," Oxford Economic Papers, Oxford University Press, vol. 37(4), pages 669-676, December.
    36. Christopher Garroway & Juan Ramón de Laiglesia, 2012. "On the Relevance of Relative Poverty for Developing Countries," OECD Development Centre Working Papers 314, OECD Publishing.
    37. Milton Friedman, 1957. "A Theory of the Consumption Function," NBER Books, National Bureau of Economic Research, Inc, number frie57-1.
    38. repec:pri:rpdevs:presidential%20address%2017january%202010%20all is not listed on IDEAS
    39. Ravallion, Martin, 2008. "On the welfarist rationale for relative poverty lines," Policy Research Working Paper Series 4486, The World Bank.
    40. Robert Inklaar, 2013. "“Price Levels and Economic Growth: Making Sense of Revisions to Data on Real Incomes”: A Comment," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 59(4), pages 614-622, December.
    41. Townsend, Peter, 1985. "A Sociological Approach to the Measurement of Poverty--A Rejoinder [Poor, Relatively Speaking]," Oxford Economic Papers, Oxford University Press, vol. 37(4), pages 659-668, December.
    42. Mick Silver, 2009. "The Hedonic Country Product Dummy Method and Quality Adjustments for Purchasing Power Parity Calculations," IMF Working Papers 2009/271, International Monetary Fund.
    43. Asian Development Bank (ADB), 2014. "Purchasing Power Parities and Real Expenditures," ADB Reports RPT146710-2, Asian Development Bank (ADB), revised 19 Aug 2014.
    44. Bhagwati, Jagdish N, 1984. "Why Are Services Cheaper in the Poor Countries?," Economic Journal, Royal Economic Society, vol. 94(374), pages 279-286, June.
    45. Asian Development Bank (ADB), 2014. "Purchasing Power Parities and Real Expenditures: A Summary Report," ADB Reports RPT146397-3, Asian Development Bank (ADB), revised 08 Jul 2014.
    46. repec:bla:revinw:v:37:y:1991:i:4:p:345-61 is not listed on IDEAS
    47. Vijayendra Rao, 2001. "Poverty and Public Celebrations in Rural India," The ANNALS of the American Academy of Political and Social Science, , vol. 573(1), pages 85-104, January.
    48. Majumder,Amita & Ray,Ranjan & Santra,Sattwik, 2015. "Preferences, purchasing power parity, and inequality : analytical framework, propositions, and empirical evidence," Policy Research Working Paper Series 7395, The World Bank.
    49. World Bank, 2013. "World Development Indicators 2013," World Bank Publications - Books, The World Bank Group, number 13191.
    50. Rebecca M. Blank, 2008. "Presidential address: How to improve poverty measurement in the United States," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 27(2), pages 233-254.
    51. Jefferson, Philip N. (ed.), 2012. "The Oxford Handbook of the Economics of Poverty," OUP Catalogue, Oxford University Press, number 9780195393781.
    52. Bruce W. Hamilton, 2001. "Using Engel's Law to Estimate CPI Bias," American Economic Review, American Economic Association, vol. 91(3), pages 619-630, June.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Jose De Gregorio & Manuel Taboada, 2022. "Median Labor Income in Chile Revised: Insights from Distributional National Accounts," Working Papers wp532, University of Chile, Department of Economics.
    2. Clément Carbonnier, 2022. "From the Main Determinants of Self‐Declared Minimum Income to the Measure of Sub‐National Purchasing Power Parity," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 68(3), pages 738-769, September.
    3. Ingvild Almås & Timothy K.M. Beatty & Thomas F. Crossley, 2018. "Lost in Translation: What do Engel Curves Tell us about the Cost of Living?," CESifo Working Paper Series 6886, CESifo.
    4. Richard Bluhm & Denis de Crombrugghe & Adam Szirmai, 2016. "Poverty Accounting. A fractional response approach to poverty decomposition," Working Papers 413, ECINEQ, Society for the Study of Economic Inequality.
    5. John Gibson, 2016. "Poverty Measurement: We Know Less than Policy Makers Realize," Asia and the Pacific Policy Studies, Wiley Blackwell, vol. 3(3), pages 430-442, September.
    6. Ravi Kanbur, 2021. "Sustainable Development Goals and the Study of Economic Inequality," The Journal of Economic Inequality, Springer;Society for the Study of Economic Inequality, vol. 19(1), pages 3-11, March.
    7. Ranjan Ray, 2017. "The Role of Prices in Welfare Comparisons: Methodological Developments and a Selective Survey of the Empirical Literature," The Economic Record, The Economic Society of Australia, vol. 93(301), pages 314-332, June.
    8. Dean Jolliffe & Espen Beer Prydz, 2016. "Estimating international poverty lines from comparable national thresholds," The Journal of Economic Inequality, Springer;Society for the Study of Economic Inequality, vol. 14(2), pages 185-198, June.
    9. Arief Anshory Yusuf & Andy Sumner, 2017. "Multidimensional poverty in Indonesia: How inclusive has economic growth been?," Departmental Working Papers 2017-09, The Australian National University, Arndt-Corden Department of Economics.
    10. Amani Kahloul & Rim Lahmandi‐Ayed & Hejer Lasram, 2019. "Poverty, competition, democracy, and ownership: A general equilibrium model with vertical preferences," Journal of Public Economic Theory, Association for Public Economic Theory, vol. 21(6), pages 1143-1178, December.
    11. Gregorio Izquierdo Llanes & Antonio Salcedo Galiano, 2023. "Why does equivalization matter? An application to the monetary poverty in the sustainable development goals framework," Quality & Quantity: International Journal of Methodology, Springer, vol. 57(3), pages 2575-2589, June.
    12. Kerner, Andrew & Crabtree, Charles, 2018. "The Political Economy of Data Production," SocArXiv qsxae, Center for Open Science.
    13. Ravallion, Martin & Chen, Shaohua, 2019. "Global poverty measurement when relative income matters," Journal of Public Economics, Elsevier, vol. 177(C), pages 1-1.
    14. Fahd Rehman & Russel J. Cooper, 2023. "Effective GDP: A Cross‐Country Comparison," The World Economy, Wiley Blackwell, vol. 46(3), pages 619-652, March.
    15. Amita Majumder & Ranjan Ray & Sattwik Santra, 2016. "Global and Country Poverty Rates, Welfare Rankings of the Regions and Purchasing Power Parities: How Robust Are the Results?," Monash Economics Working Papers 11-16, Monash University, Department of Economics.
    16. Michail Moatsos & Achillefs Lazopoulos, 2024. "Stress-testing the international poverty line and the official global poverty statistics," Palgrave Communications, Palgrave Macmillan, vol. 11(1), pages 1-12, December.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Ravallion, Martin, 2018. "An exploration of the changes in the international comparison program’s global economic landscape," World Development, Elsevier, vol. 105(C), pages 201-216.
    2. Amita Majumder & Ranjan Ray & Sattwik Santra, 2016. "Global and Country Poverty Rates, Welfare Rankings of the Regions and Purchasing Power Parities: How Robust Are the Results?," Monash Economics Working Papers 11-16, Monash University, Department of Economics.
    3. Ravallion, Martin & Chen, Shaohua, 2019. "Global poverty measurement when relative income matters," Journal of Public Economics, Elsevier, vol. 177(C), pages 1-1.
    4. Martin Ravallion, 2020. "On Measuring Global Poverty," Annual Review of Economics, Annual Reviews, vol. 12(1), pages 167-188, August.
    5. Decerf,Benoit Marie A, 2022. "Absolute and Relative Poverty Measurement : A Survey," Policy Research Working Paper Series 10008, The World Bank.
    6. Martin Ravallion & Shaohua Chen, 2011. "Weakly Relative Poverty," The Review of Economics and Statistics, MIT Press, vol. 93(4), pages 1251-1261, November.
    7. Robert C. Allen, 2017. "Absolute Poverty: When Necessity Displaces Desire," American Economic Review, American Economic Association, vol. 107(12), pages 3690-3721, December.
    8. Chen, Shaohua & Ravallion, Martin, 2021. "Reconciling the conflicting narratives on poverty in China," Journal of Development Economics, Elsevier, vol. 153(C).
    9. Moatsos Michail, 2016. "Global Absolute Poverty: Behind the Veil of Dollars," Journal of Globalization and Development, De Gruyter, vol. 7(2), pages 1-28, December.
    10. Ravallion,Martin & Chen,Shaohua, 2017. "Welfare-consistent global poverty measures," Policy Research Working Paper Series 8170, The World Bank.
    11. Francisco H. G. Ferreira & Shaohua Chen & Andrew Dabalen & Yuri Dikhanov & Nada Hamadeh & Dean Jolliffe & Ambar Narayan & Espen Beer Prydz & Ana Revenga & Prem Sangraula & Umar Serajuddin & Nobuo Yosh, 2016. "A global count of the extreme poor in 2012: data issues, methodology and initial results," The Journal of Economic Inequality, Springer;Society for the Study of Economic Inequality, vol. 14(2), pages 141-172, June.
    12. Facundo Alvaredo & Leonardo Gasparini, 2013. "Recent Trends in Inequality and Poverty in Developing Countries," CEDLAS, Working Papers 0151, CEDLAS, Universidad Nacional de La Plata.
    13. Robert Inklaar & D. S. Prasada Rao, 2017. "Cross-Country Income Levels over Time: Did the Developing World Suddenly Become Much Richer?," American Economic Journal: Macroeconomics, American Economic Association, vol. 9(1), pages 265-290, January.
    14. Robert C. Allen, 2017. "Absolute Poverty: When Necessity Displaces Desire REVISED," Working Papers 20170005, New York University Abu Dhabi, Department of Social Science, revised Jun 2017.
    15. Martin Ravallion, 2016. "Are the world’s poorest being left behind?," Journal of Economic Growth, Springer, vol. 21(2), pages 139-164, June.
    16. Decerf, Benoit, 2017. "Why not consider that being absolutely poor is worse than being only relatively poor?," Journal of Public Economics, Elsevier, vol. 152(C), pages 79-92.
    17. Decerf,Benoit Marie A & Ferrando,Mery & Quinn,Natalie N., 2021. "Global Income Poverty Measurement with Preference Heterogeneity : Theory and Application," Policy Research Working Paper Series 9844, The World Bank.
    18. Decerf, B., 2015. "A new index combining the absolute and relative aspects of income poverty: Theory and application," LIDAM Discussion Papers CORE 2015050, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
    19. Dhongde, Shatakshee & Minoiu, Camelia, 2013. "Global Poverty Estimates: A Sensitivity Analysis," World Development, Elsevier, vol. 44(C), pages 1-13.
    20. Hassan, Fadi, 2016. "The price of development: The Penn–Balassa–Samuelson effect revisited," Journal of International Economics, Elsevier, vol. 102(C), pages 291-309.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ess:wpaper:id:7753. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Padma Prakash (email available below). General contact details of provider: http://www.esocialsciences.org .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.