Chapter 4
Frontiers of Poverty Measurement
As conditions change and policy concerns evolve, there is a steady demand from countries and institutions for new tools to evaluate poverty. In this chapter, we briefly discuss frontier technologies that are, at the time of this writing, in various stages of being implemented in the ADePT software. Most are refinements of the traditional approach to poverty measurement, but some elaborate on related concepts of inequality and income standards.
Ultra-Poverty Our first enhancement builds on a theme that originally led to the construction of poverty measures beyond the headcount ratio, namely, that within the poor population important differences exist in the nature of poverty. The headcount ratio P0 ignores these differences by valuing each poor person equally without regard to the depth of poverty. Measures like the poverty gap P1 reflect the depth of poverty among the poor, while others like the FGT (Foster-Greer-Thorbecke) index P2 take into account its distribution by emphasizing those with the largest gaps. The measurement of ultra-poverty carries this differentiation one step further by focusing on the poorest of the poor. People who are most impoverished according to some well-defined criterion are often the subject of special concern. The poverty experienced by this group is often called “extreme” or “acute.” Here we use the term ultra-poverty to describe the condition of poorest poor. Who are the ultrapoor and how can their poverty be measured? The answer depends on the
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