More Relatively-Poor People in a Less Absolutely-Poor World

Relative deprivation, shame and social exclusion can matter to the welfare of people everywhere. The authors argue that such social effects on welfare call for a reconsideration of how we assess global poverty, but they do not support standard meas...

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Bibliographic Details
Main Authors:	Chen, Shaohua, Ravallion, Martin
Format:	Policy Research Working Paper
Language:	English
Published:	World Bank, Washington, DC 2012
Subjects:	ABSOLUTE POVERTY ABSOLUTE POVERTY LINE ABSOLUTE TERMS ABSOLUTE VALUE AGGREGATE POVERTY AVERAGE INEQUALITY CHANGES IN POVERTY CHILD MORTALITY CONSUMER PRICE INDEX CONSUMPTION BEHAVIOR CONSUMPTION DATA CONSUMPTION EXPENDITURES COUNTRY DATA COUNTRY INEQUALITY COUNTRY LEVEL CUMULATIVE DISTRIBUTION CUMULATIVE DISTRIBUTION FUNCTION DATA SETS DEVELOPED COUNTRIES DEVELOPING COUNTRIES DEVELOPING COUNTRY DEVELOPING WORLD DEVELOPMENT ECONOMICS DEVELOPMENT POLICY DEVELOPMENT REPORT DEVELOPMENT RESEARCH ECONOMIC CONTRACTION ECONOMIC GROWTH ECONOMICS EMPIRICAL EVIDENCE EMPIRICAL RESULTS ESTIMATED COEFFICIENTS FOOD PRICE FOOD PRICES FOOD SHARE FUNCTIONAL FORM GINI INDEX GLOBAL MARKETS GLOBAL POVERTY GROWTH RATE GROWTH RATES HIGH INEQUALITY HIGHER INEQUALITY HOUSEHOLD CONSUMPTION HOUSEHOLD CONSUMPTION PER CAPITA HOUSEHOLD INCOME HOUSEHOLD SIZE HOUSEHOLD SURVEY HOUSEHOLD SURVEYS IMPACT ON POVERTY INCIDENCE OF POVERTY INCOME INCOME DISTRIBUTION INCOME POVERTY INEQUALITY INEQUALITY MEASURES INFLATION RATE INTERNATIONAL POVERTY LINE LIVING STANDARDS LOW INEQUALITY MEASUREMENT OF POVERTY MEASURING POVERTY MICRO DATA NATIONAL ACCOUNTS NATIONAL POVERTY NATIONAL POVERTY LINES PER CAPITA CONSUMPTION PER CAPITA EXPENDITURE POLICY ANALYSIS POLICY RESEARCH POOR POOR COUNTRIES POOR PEOPLE POPULATION SHARE POST-REFORM POVERTY ASSESSMENTS POVERTY COMPARISONS POVERTY GAP POVERTY GAP INDEX POVERTY INCIDENCE POVERTY LEVEL POVERTY LINE POVERTY MEASURE POVERTY MEASUREMENT POVERTY MEASURES POVERTY RANKINGS POVERTY RATE POVERTY RATES POVERTY REDUCTION POVERTY REDUCTION STRATEGY POVERTY REDUCTION STRATEGY PAPERS REAL INCOMES REGIONAL AUTHORITIES REGIONAL DIFFERENCES REGIONAL POVERTY REGIONAL PROFILE RICH COUNTRIES RURAL RURAL AREAS RURAL POVERTY RURAL POVERTY LINES SIGNIFICANT CORRELATION SOCIAL NORMS URBAN AREAS
Online Access:	http://documents.worldbank.org/curated/en/2012/07/16458176/more-relatively-poor-people-less-absolutely-poor-world http://hdl.handle.net/10986/11876

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Summary:	Relative deprivation, shame and social exclusion can matter to the welfare of people everywhere. The authors argue that such social effects on welfare call for a reconsideration of how we assess global poverty, but they do not support standard measures of relative poverty. The paper argues instead for using a weakly-relative measure as the upper-bound complement to the lower-bound provided by a standard absolute measure. New estimates of global poverty are presented, drawing on 850 household surveys spanning 125 countries over 1981-2008. The absolute line is $1.25 a day at 2005 prices, while the relative line rises with the mean, at a gradient of 1:2 above $1.25 a day. The authors show that these parameter choices are consistent with cross-country data on national poverty lines. The results indicate that the incidence of both absolute and weakly-relative poverty in the developing world has been falling since the 1990s, but more slowly for the relative measure. While the number of absolutely poor has fallen, the number of relatively poor has changed little since the 1990s, and is higher in 2008 than 1981.

More Relatively-Poor People in a Less Absolutely-Poor World

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