Concepts and Measurement of Poverty Flashcards
What is poverty?
Poverty refers to a lack of financial resources and essentials for a minimum standard of living.
Name the three key types of poverty.
Absolute poverty, relative poverty, and multidimensional poverty.
Define absolute poverty.
Poverty measured against a fixed threshold, like living on less than $2.15 a day (World Bank standard).
How is relative poverty different from absolute poverty?
Relative poverty is defined by economic inequality within a society, based on median income.
What does multidimensional poverty consider?
Non-monetary dimensions like education, healthcare, and access to clean water.
What index is used to measure multidimensional poverty?
The Multidimensional Poverty Index (MPI).
What is the Headcount Index (HCI)?
The proportion of the population living below the poverty line.
What is a limitation of the Headcount Index?
It does not account for the depth or intensity of poverty.
What does the Poverty Gap Index measure?
The average shortfall of the poor from the poverty line, showing poverty intensity.
How does the Squared Poverty Gap Index differ?
It accounts for inequality among the poor by assigning higher weights to those further below the poverty line
Name a composite measure of poverty.
The Human Poverty Index (HPI).
What indicators does the HPI include?
Life expectancy, literacy, and living standards.
Why is poverty considered multidimensional?
It involves deprivations not only in income but also in education, health, and living standards.
How does addressing inequality help reduce poverty?
It promotes equitable resource distribution and inclusive growth.
What is the relationship between poverty and inequality?
High inequality exacerbates poverty by limiting access to resources and opportunities for the poor.
