Definition of global poverty. (user search)
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  Definition of global poverty. (search mode)
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Author Topic: Definition of global poverty.  (Read 2057 times)
ag
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« on: January 18, 2006, 12:12:28 PM »

I would say being above the poverty line would include:
1) having a roof over your head
2) having clothes on your back
3) having something to eat

I was looking for Math, numbers, dollars...



You have a strange view of what "math" is.

What would you consider a normal worldwide average temperature of bodies and walls in a hospital (including the morgue)? Your question has as much sense as mine - that is, none whatsoever. You try to reduce to one number something that is impossible to reduce that way. Even having the same poverty line definition in New York and Buffalo is ridiculous - forget the worldwide number.

By the way, the general fascination with "the number of people in poverty" is also ridiculous. Consider the following example: in a country A there is the following income distribution: a third population has 100 tugriks/ year, a third has 19 tugriks and a third has 10 tugriks. The poverty line has been defined as 20 tugriks (suppose it has somehow been done objectively and is non-controversial). The "poverty rate" is 2/3, isn't it? Now the government decides to remedy it with transfers. After transfers the new income distribution is: a third of the population has 109 tugriks/year, a third has 20 tugriks, and a third has nothing. According to the same measure, the poverty rate has been reduced to 1/3. Wasn't it a great poverty reduction program! (of course, in reality it just robbed the poorest and gave most of what they had to the richest).

Whenever governments concentrate on "reducing the poverty rate" they have incentives to transferfrom the poorest to the less poor. If you want good measures of poverty, look for the "generalized income gap" (I am too lazy to explain what it is - google).
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ag
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« Reply #1 on: January 18, 2006, 03:26:30 PM »

If you want good measures of poverty, look for the "generalized income gap" (I am too lazy to explain what it is - google).

Oh yes, isn't that the 'Gini'?

No, it's not. Gini has nothing to do with poverty - it's about inequality. Anyway, if you want to talk about inequality, Theil's enthropy index is, probably, better than the pretty arbitrary Gini (though, really, we can say something only when the two - and a whole bunch of other things - agree).

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ag
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Posts: 12,828


« Reply #2 on: January 20, 2006, 12:42:51 AM »

How would you define poverty if you were cumulatively looking at the world economy?

The current measure the UN uses is $1 a day, of which 20% of the globe is at or below, that is approximately 1.2 billion people. Which is slightly more than 4 times the US population.

I would define poverty as being around $5 a day.

The cost of living is significantly lower, even in some European Countries, than it is here.  You could live in France for $15/day let alone, say, Poland.

The cost of day to day living is substantially higher in many Western European countries (unless you consider some social benefits, like subsidized day care, education or medical care). A single short tube ride in London would set you back over $5 USD vs. $2 USD in New York (even with prepay "Oyster Cards" and all, it would still be nearly $3 dollars), and it would be more for a longer ride. Most groceries are far more expensive in England as well. A smallish one-bedroom apartment in Birmingham would be around 700 pounds (about $1250) a month - I don't want even to think what it is in London (5 years ago a friend was renting a nice but somewhat decrepit place near Paddington station for about 3000 pounds a month - this was far more than anything like that would be in New York; as he said, "Brits don't live here - it's too expensive for them").

To a lesser extent same is true of much of the continental Europe. You might be able to live ok somewhere in France for $15 (what is it, 13 euros?) - but not in Paris, or, at least, you won't be living any better there on $15/day than you would in NYC (come to think of it, I used to live on some $20/day after rent in NYC, and it was ok, but I was a grad student and it was some time ago; hey, as an undergrad in Long Island in the early 1990s I spent much less than 5 dollars a day, not counting the cost of the dorm and tuition, which, mercifully, my scholarship paid for - I was dreadfully poor - but was that living? An all ramen noodles diet seasoned with the free ketchup from the cafeteria, and you have to think if you really want to open an extra package, or if you can afford laundry this week; a $1.25 bus ride seemed nearly an impossible luxury).  The last two summers I've been in Madrid, Barcelona, Paris and London, and all of them I found very expensive, compared with the US (perhaps, because I don't know where to get the cheap stuff there). The only place I thought was cheap was Galicia (the northwestern corner of Spain) - but that is a relatively poor province of one of the poorer Western European countries.  Eastern Europe is another matter, of course.
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