A New Measure of Multidimensional Poverty
Researchers at the Oxford Poverty and Human Development Initiative (OPHI) have created a new methodology for measuring poverty that has been adopted by the United Nations Development Programme (UNDP)’s flagship Human Development Report and national governments.
At the national and international level poverty is usually measured using income alone. Yet many agree that poverty is multidimensional. People living in poverty describe their ill-being as comprising low income and poor-quality work, ill health and a fear of health problems, having to skip meals, not being educated, being disempowered, experiencing violence and humiliation, and so on. And contrary to popular opinion, the people whose lives are battered by the most deprivations may not be the poorest in terms of income. Those working to reduce poverty need information on key deprivations that affect people’s lives. A challenge has been how to construct poverty measures that show which deprivations each person or household experiences at the same time.
Recognising this, OPHI Director Dr Sabina Alkire and Professor James Foster, OPHI Research Associate and Professor at George Washington University, developed a methodology for measuring multidimensional poverty that captures the overlapping deprivations faced by each person. The methodology creates poverty measures that incorporate a range of indicators (which can include income) tailored to specific societies and situations, to capture the complexity of poverty and better inform policies to reduce it.
OPHI has used this methodology to create a new international poverty measure – the Multidimensional Poverty Index or MPI for 109 developing countries. First included in UNDP’s 20th Anniversary Human Development Report in 2010, and substantially updated in 2011, the MPI measures key deprivations in education, health and living standards directly. It builds a vivid picture of people living in poverty and captures the overlapping deprivations that batter poor peoples’ lives at the same time. In 2011, analysis of MPI poverty was also carried out at the sub-national level for 66 countries. This showed a ‘high resolution’ picture of disparities in poverty within countries, as well as differences in how poverty is composed by state, region or province. As an analytical tool i has been used by governments and development agencies to identify the most vulnerable people, show the aspects in which they are deprived, and help reveal the interconnections among deprivations.
Increasingly, this approach and methodology is also being applied and adapted at the national level to create multidimensional poverty measures tailored to the challenges and circumstances of individual countries. Mexico launched the first national poverty measure to use an adaptation of this methodology in 2010. The following year the Colombian Government introduced the MPI-Colombia, a national multidimensional poverty measure (which uses this methodology) to set binding poverty reduction targets. Bhutan meanwhile has used the methodology to underpin its Gross National Happiness Index which measures national wellbeing. The methodology is proving more and more popular at the national level because it is intuitive, rigorous, flexible – countries can decide their own indicators, weights and cutoffs – and can be decomposed by population sub-group and broken down by dimension to give a ‘high resolution’ view of poor people’s lives.
