Measuring Poverty
MEASURING POVERTY Poverty can be measured either on the level of a household or on the level of a region. As an aggregate of many households, regional or national measures of poverty translate into what is known as a low standard of living. ... However, there are other criteria that authorities recognize as component of measuring poverty or standard of living. ... Poverty, in these contemporary times, has come to mean more than just economic disability. ... Example 1: Poverty dimension: being well nourished; Indicator: mean daily consumption of a staple food like rice Example 2: Poverty dimension: peace and order; Idicator: costs arising from crime and violence Examples 1 and 2 each show a dimension of poverty that cannot be easily quantified. ... HOUSEHOLD LEVEL Though poverty can be measured down to the individual, it becomes problematic when one tries to discern whose income one should take into account. Determining poverty by individual and personal incomes is not always accurate in societies where families share incomes. ... This is why most authorities rely on the second smallest unit for which to account for poverty—the household. ... Once income, consumption, proxy variables and or a combination of these is determined for the household level, a minimum level, called the poverty line, is drawn. Poverty is then simply any household that falls below this minimum level, i. ... The question on where to draw the poverty line is another issue about which there is little consensus among researchers. There are two main ways of setting poverty lines—relative and absolute: Relative poverty lines: These are defined in relation to the overall distribution of income or consumption in a country; for example, the poverty line could be set at 50 percent of the country’s mean income or consumption. Absolute poverty lines: These are anchored in some absolute standard of what households should be able to count on in order to meet their basic needs. For monetary measures, these absolute poverty liens are often based on estimates of the cost of basic foods needs, that is, the cost of a nutritional basket considered minimal for the health of a typical family, to which a provision is added for nonfood needs.