Oxford and UNDP launch a better way to measure poverty

Oxford and UNDP launch a better way to measure poverty
14 July 2010
London, 14 July 2010: The Oxford Poverty and Human Development Initiative (OPHI) of Oxford University and the Human Development Report Office of the United Nations Development Programme (UNDP) today launched a new poverty measure that gives a “multidimensional” picture of people living in poverty which its creators say could help target development resources more effectively.
The new measure, the Multidimensional Poverty Index, or MPI, was developed and applied by OPHI with UNDP support, and will be featured in the forthcoming 20th anniversary edition of the UNDP Human Development Report. The MPI supplants the Human Poverty Index, which had been included in the annual Human Development Reports since 1997.
The 2010 UNDP Human Development Report will be published in late October, but research findings from the Multidimensional Poverty Index were made available today at a policy forum in London and on line on the websites of OPHI (www.ophi.org.uk).
The MPI assesses a range of critical factors or ‘deprivations’ at the household level: from education to health outcomes to assets and services. Taken together, these factors provide a fuller portrait of acute poverty than simple income measures, according to OPHI and UNDP. The measure reveals the nature and extent of poverty at different levels: from household up to regional, national and international level. This new multidimensional approach to assessing poverty has been adapted for national use in Mexico, and is now being considered by Chile and Colombia.
‘The MPI is like a high resolution lens which reveals a vivid spectrum of challenges facing the poorest households,’ said OPHI Director Dr Sabina Alkire, who created the MPI with Professor James Foster of George Washington University.
The UNDP Human Development Report Office is joining forces with OPHI to promote international discussions on the practical applicability of this multidimensional approach to measuring poverty. ‘We are featuring the Multidimensional Poverty Index in the 20th anniversary edition of the Human Development Report this year because we consider it a highly innovative approach to quantifying acute poverty,’ Dr Jeni Klugman, Director of the UNDP Human Development Report Office and the principal author of this year’s Report, said. ‘The MPI provides a fuller measure of poverty than the traditional dollar-a-day formulas. It is a valuable addition to the family of instruments we use to examine broader aspects of well-being, including UNDP’s Human Development Index and other measures of inequality across the population and between genders.’
OPHI researchers analysed data from 104 countries with a combined population of 5.2 billion (78 per cent of the world total). About 1.7 billion people in the countries covered – a third of their entire population - live in multidimensional poverty, according to the MPI. This exceeds the 1.3 billion people, in those same countries, estimated to live on $1.25 a day or less, the more commonly accepted measure of ‘extreme’ poverty.
The MPI also captures distinct and broader aspects of poverty. For example, in Ethiopia 90 per cent of people are ‘MPI poor’ compared to the 39 per cent who are classified as living in ‘extreme poverty’ under income terms alone. Conversely, 89 per cent of Tanzanians are extreme income-poor, compared to 65 per cent who are MPI poor. The MPI captures deprivations directly – in health and educational outcomes and key services, such as water, sanitation and electricity. In some countries these resources are provided free or at low cost; in others they are out of reach even for many working people with an income.
Half of the world’s poor as measured by the MPI live in South Asia (51 per cent or 844 million people) and one quarter in Africa (28 per cent or 458 million). Niger has the greatest intensity and incidence of poverty in any country, with 93 per cent of the population classified as poor in MPI terms.
Even in countries with strong economic growth in recent years, the MPI analysis reveals the persistence of acute poverty. India is a major case in point. There are more MPI poor people in eight Indian states alone (421 million in Bihar, Chhattisgarh, Jharkhand, Madhya Pradesh, Orissa, Rajasthan, Uttar Pradesh, and West Bengal) than in the 26 poorest African countries combined (410 million). The MPI also reveals great variations within countries: Nairobi has the same level of MPI poverty as the Dominican Republic, whereas Kenya’s rural northeast is poorer in MPI terms than Niger.
The recently released 2010 UN Millennium Development Goals Report stressed that the MDGs will be fully achieved only by addressing the needs of those most disadvantaged by geography, age, gender or ethnicity, OPHI researchers point out. ‘Our measure identifies the most vulnerable households and groups and enables us to understand exactly which deprivations afflict their lives”, said Dr. Alkire. “The new measure can help governments and development agencies wishing to target aid more effectively to those specific communities.’
More poor in eight states than 26 African nations
The Economic Times, 13th July 2010

NEW DELHI: This data is certain to have a sobering effect on policy wonks who never get tired of trumpeting the growth story and prompt them to recognise the chasm between prosperous India and struggling India. A UNDP survey says that eight Indian states have more poor than 26 African nations put together.

A new Multi-dimensional Poverty Index (MPI) conceived and created by the Oxford Poverty and Human Development Initiative with UNDP support to measure global poverty has said that acute poverty prevails in Bihar, Chhattisgarh, Jharkhand, Madhya Pradesh, Orissa, Rajasthan, Uttar Pradesh and West Bengal. Together they account for 421 million, 11 million more “MPI poor” than in the 26 poorest African countries.

This will form part of the findings of the 2010 UNDP Human Development Report, which will be published in late October. The research findings from MPI were made available in London on Monday.
The MPI assesses a range of critical factors or “deprivations” at the household level: From education to health outcomes to assets and services. Taken together, these factors provide a fuller portrait of acute poverty than simple income measures, according to UNDP. The measure reveals the nature and extent of poverty at different levels — from household up to regional, national and international level.
This new multidimensional approach to assessing poverty has been adapted for national use in Mexico, and is now being considered by Chile and Colombia. “The MPI is like a high resolution lens which reveals a vivid spectrum of challenges facing the poorest households,” agency reports quoting OPHI Director Dr Sabina Alkire, who created the MPI with Professor James Foster of George Washington University and Maria Emma Santos of OPHI said.
The UNDP Human Development Report Office is also joining forces with OPHI to promote international discussions on the practical applicability of this multidimensional approach to measuring poverty.
“We are featuring the Multidimensional Poverty Index in the 20th anniversary edition of the Human Development Report this year because we consider it a highly innovative approach to quantifying acute poverty,” agency reports from London quoting Dr Jeni Klugman, Director of the UNDP Human Development Report Office and the principal author of this year’s Report, said. The MPI provides a fuller measure of poverty than the traditional dollar-a-day formulas. It is a valuable addition to the family of instruments we use to examine broader aspects of well-being, including UNDP’s Human Development Index and other measures of inequality across the population and between genders.
The research organisation’s officials analysed data from 104 countries with a combined population of 5.2 billion (78% of the world total). About 1.7 billion people in the countries covered — a third of their entire population — live in multidimensional poverty. This exceeds the 1.3 billion people, in those same countries, estimated to live on $ 1.25 a day or less, the more commonly accepted measure of ‘extreme’ poverty. Half of the world’s poor as measured by MPI live in South Asia — 51% or 844 million people — and one quarter in Africa.
New poverty index finds Indian states worse than Africa
Hindustan Times, July 13, 2010
More people are mired in poverty in eight Indian states than in the 26 poorest African countries, according to a new UN-backed measure of poverty. The Multidimensional Poverty Index (MPI) looks beyond income at a wider range of household-level deprivation, including services, which could then be used to help target development resources. Its findings throw up stark statistics compared to regular poverty measures.
The study found that half of the world's MPI poor people live in South Asia, and just over a quarter in Africa.
There are 421 million MPI poor people in eight Indian states alone -- Bihar, Chhattisgarh, Jharkhand, Madhya Pradesh, Orissa, Rajasthan, Uttar Pradesh, West Bengal -- and 410 million in the 26 poorest African countries combined.
The researchers said that the extent of poverty in India had often been overlooked, by figures comparing percentages of poor people in countries as a whole rather than sheer numbers.
According to the index, 64.5 per cent of people in sub-Saharan Africa are MPI poor. In South Asia, 55 per cent of people are MPI poor. Both figures are higher than the number considered extreme income poor -- living on less than 1.25 dollars per day.
The new index was created by the Oxford Poverty and Human Development Initiative (OPHI) at Oxford University in southern England, and the Human Development Report Office of the United Nations Development Programme (UNDP).
"Our measure identifies the most vulnerable households and groups and enables us to understand exactly which deprivations afflict their lives," said OPHI director Sabina Alkire.
"The new measure can help governments and development agencies wishing to target aid more effectively to those specific communities."
The MPI will be used in the forthcoming 20th anniversary edition of the UNDP Human Development Report. It supplants the Human Poverty Index, which has been used since 1997.
The index takes into account that people living in MPI poverty may not necessarily be income poor: only two-thirds of Niger's people are income poor, whereas 93 per cent are poor by the MPI, it found.
It also showed that "multi-dimensional poverty" varies a lot within countries. In Delhi, 15 per cent of people are MPI poor, compared to 81 per cent in Bihar.

Delhi, Kerala, Goa have least number of poor: UNDP
Indian Express, July 15, 2010

Amidst acute poverty across South Asia, the five states of Delhi, Kerala, Goa, Punjab and Himachal Pradesh have the least number of poor people in India, according to a new measure of global poverty developed at the University of Oxford for the UNDP.
The new measure, called the Multidimensional Poverty Index (MPI), has been developed and applied by the Oxford Poverty and Human Development Initiative (OPHI).
It will be featured in the forthcoming 20th anniversary edition of the UN Development Programme Human Development Report.
A detailed analysis using the MPI reveals that South Asia and Sub-Saharan Africa have comparable intensities of poverty, according to an OPHI working paper titled 'Acute Multidimensional Poverty: A New Index for Developing Countries'.
In terms of human lives, South Asia has the world's highest levels of poverty.
Fifty-one per cent of the population of Pakistan is MPI poor, 58 per cent in Bangladesh, 55 per cent in India, and 65 per cent in Nepal.
The analysis states: "We find that Delhi has an MPI equivalent to Iraq (which ranks 45), whereas Bihar's MPI is similar to Guinea´s (the 8th poorest country in the ranking).
"In terms of headcount, in Delhi and Kerala 14 per cent and 16 per cent of the population are MPI poor, respectively, whereas in Jharkhand 77 per cent of the population are MPI poor and in Bihar, 81 per cent".
Other 'top ten' states with the least number of poor in India are Tamil Nadu, Uttarakhand, Maharashtra, Haryana and Gujarat.
The analysis by MPI creators reveals that there are more 'MPI poor' people in eight Indian states (421 million in Bihar, Chhattisgarh, Jharkhand, Madhya Pradesh, Orissa, Rajasthan, Uttar Pradesh, and West Bengal) than in the 26 poorest African countries combined (410 million).
"Just to provide a sense of perspective, the population of the poorest Indian state Bihar, with 95 million people, exceeds the sum of nine of the ten poorest African countries," according to the authors Sabina Alkire and Maria Emma Santos.
Further analysis shows that in India, the Scheduled Tribes have the highest MPI (0.482), almost the same as Mozambique, and a headcount of 81 per cent.
The Scheduled Castes have a headcount of 66 per cent and their MPI is a bit better than Nigeria.
Fifty-eight per cent of other Backward Castes are MPI poor.
About one in three of the remaining Indian households are multi-dimensionally poor, and their MPI is just below that of Honduras, the paper says.
As many as 39 per cent in India live in a poor household where at least one child or woman is undernourished.
The paper adds that 25 per cent in India, and 15 per cent in Nepal live in a household where one or more
children are not attending school.
Half of the world's poor as measured by the MPI live in South Asia (51 per cent or 844 million people) and one quarter in Africa (28 per cent or 458 million).
Niger has the greatest intensity and incidence of poverty in any country, with 93 per cent of the population classified as poor in MPI terms.
The MPI reveals the nature and extent of poverty at different levels: from household up to regional, national and international level.
This new multidimensional approach to assessing poverty has been adapted for national use in Mexico, and is now being considered by Chile and Colombia.
"The MPI is like a high resolution lens which reveals a vivid spectrum of challenges facing the poorest households," said OPHI Director Sabina Alkire.