Multidimensional Poverty Measurement and Analysis: Chapter 9 – Distribution and Dynamics

Abstract

For meaningful policy analysis, it is important not only to look at overall poverty, and compare countries or regions at a single point in time, but also to understand the distribution among the poor, the disparity across subgroups, and the dynamics of poverty. This extends the methodological toolkit presented in Chapter 5. First we present a new measure of inequality among the poor and its axiomatic justification. The same measure, a form of variance, can be extended to analyse horizontal inequalities, which are disparities across different population subgroups. The next two sections provide methodological extensions that are required for inter-temporal analysis of poverty using repeated cross-sectional data, and for the analysis of dynamic subgroups. The last section elaborates a measure chronic multidimensional poverty, which uses a counting approach both across dimensions and across periods, and provide its consistent partial indices, including a new statistic on the duration of poverty.

Keywords: inequality decomposition, disparity across subgroup poverty, inter-temporal analysis of poverty, chronic multidimensional poverty, dynamic poverty decomposition

JEL Classification: C61, D30, D99, I32