A Welfarist Theory Unifying Monetary and Non-Monetary Poverty Measurement
Multidimensional poverty measures are increasingly used in practice even though they face strong criticism and generate longlasting debates. These contentions primarily find their origin in the divergence between standard poverty identification pra...
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| Format: | Working Paper |
| Language: | English |
| Published: |
World Bank, Washington, DC
2022
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| Online Access: | http://documents.worldbank.org/curated/en/099231506092230051/IDU0bcbf5f7809dfb04dbe082e603ac11ae96b07 http://hdl.handle.net/10986/37520 |
| Summary: | Multidimensional poverty measures are
increasingly used in practice even though they face strong
criticism and generate longlasting debates. These
contentions primarily find their origin in the divergence
between standard poverty identification practices and a
welfarist definition of the poor. This paper fills this gap
by constructing a poverty measurement theory that (i) adopts
a welfarist definition of the poor, (ii) acknowledges that
the relevant welfare function is only partially known and
(iii) encompasses both market and non-market dimensions of
well-being. The theory shows that standard identification
practices are not flexible enough in order to properly
account for the multidimensional nature of well-being. This
nature implies that an individual is poor when she
experiences an extremely low outcome in some dimension
or/and when she cumulates moderately low outcomes in several
dimensions. The paper proposes a simple refinement that
better reflects this insight. The paper uses the theory in
order to provide answers to several longlasting debates. The
theory provides a conceptual foundation from which
practitioners may derive guidance for the many choices they face. |
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