Measuring complex poverty
An influential poverty measurement tool is making poverty more visible and helping countries around the world to target their resources at those most in need.
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Meet Aruna. She lives with her husband and their four children under a bridge by railway tracks in Mumbai. Their only light comes from the street lights, and they rely on a pay-and-use toilet for water and sanitation. The children are mocked at school for being dirty. 30 year-old Aruna earns a living by making and selling flower garlands, and the children supplement this meagre income by blowing up and selling balloons at the seaside each day after school. They eat very little: if the family doesn’t earn enough, they all go to bed hungry.
Aruna is one of millions of people throughout the world who are acutely poor. The fact that she is poor is clear, but in order to address that poverty, policy makers need more information. In 2007, Oxford Poverty and Human Development Initiative (OPHI) Director Sabina Alkire and Professor James Foster developed a new method of measuring poverty in all its forms.
Most countries of the world define poverty as a lack of money, but Alkire Foster (AF) method can be used to create a more comprehensive picture, revealing the range of overlapping disadvantages poor people can experience – such as poor sanitation, malnutrition, lack of education, poor quality of work, or violence.
Using the AF method, OPHI calculates the Global Multidimensional Poverty Index (MPI), which has been published since 2010 in the United Nations Development Programme’s Human Development Report. The Global MPI is an internationally-comparable measure of acute poverty covering more than 100 developing countries. It includes three dimensions of poverty: health, education and living standards. Each of these dimensions is comprised of a number of weighted poverty indicators. A person is poor according to the Global MPI if they are deprived in at least one third of the weighed indicators.
OPHI’s Winter 2014/2015 updates of the Global MPI revealed that 1.6 billion people around the world were living in multidimensional poverty. As well as providing a headline measure of poverty within each country, the measure can be broken down to reveal the different ways that people are poor, and where the poorest live. For example, in Doula, Cameroon’s largest city, 7% of people are MPI poor, but in the Extrême-Nord this proportion is 87%.
Governments can also use the AF method to create their own MPIs that incorporate the dimensions and indicators of poverty relevant to their own national context and goals. The governments of Bhutan, Colombia, Mexico and Chile, along with the state of Minas Gerais in Brazil and Ho Chi Minh City in Vietnam, have already launched official multidimensional poverty measures to shape social policies and inform the targeting of anti-poverty programmes. Many other countries are in the process of developing such measures. By pinpointing exactly how and where people are poor, these measures can help governments focus their resources and combat poverty more effectively.
Aruna is still poor, but work done by OPHI means that the multidimensional nature of her poverty can now be fully recognised and more effectively addressed. Without that recognition, she can be missed by official statistics, and governments can’t act on poverty unless they see and understand it. The AF method and the global and national multidimensional poverty measures based on the methodology are crucial for enabling governments and international organisations to tackle the most acute poverty, helping Aruna and people like her around the world.