A number of multidimensional poverty measures that respect the ordinal nature of dimensions have recently been proposed within the counting approach framework. Besides ensuring a reduction in poverty, however, it is important to monitor distributional changes to ensure that poverty reduction has been inclusive in reaching the poorest. Distributional issues are typically captured by adjusting a poverty measure to be sensitive to inequality among the poor. This approach, however, has certain practical and conceptual limitations. It conflicts, for example, with some policy-relevant measurement features, such as the ability to decompose a measure into dimensions post-identification and does not create an appropriate framework for assessing disparity in poverty across population subgroups. In this chapter, we propose and justify the use of a separate decomposable inequality measure – a positive multiple of “variance” – to capture the distribution of deprivations among the poor and to assess disparity in poverty across population subgroups. We demonstrate the applicability of our approach through two contrasting inter-temporal illustrations using Demographic Health Survey data sets for Haiti and India.
We are grateful to our colleagues at OPHI including James Foster and Gaston Yalonetzky, to the participants of the Centre for the Study of African Economies Annual Conference 2013 at Oxford, the Development Studies Association Conference 2013 at Birmingham, the Southern Economic Association Annual Meetings 2013 at Tampa, the HDRO Workshop in March 2013, the Fifth Meeting of the Society for the Study of Economic Inequality 2013 at Bari, and the Workshop on the Theory and Empirics of Inequality, Poverty, and Mobility at Queen Mary, University of London in October 2014 for helpful responses and to Milorad Kovacevic in particular for comments. We are thankful to the referee for comments, which greatly benefitted the study. All errors in this chapter are our own.
Seth, S. and Alkire, S. (2017), "Did Poverty Reduction Reach the Poorest of the Poor? Complementary Measures of Poverty and Inequality in the Counting Approach", Bandyopadhyay, S. (Ed.) Research on Economic Inequality (Research on Economic Inequality, Vol. 25), Emerald Publishing Limited, Bingley, pp. 63-102. https://doi.org/10.1108/S1049-258520170000025005
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