This paper asks where do the world’s multidimensionally poor people live? The paper considers how the global distribution of multidimensional poverty differs from the global distribution of income poverty and assesses the sensitivity of findings to widely used (although somewhat arbitrary) country classifications. Surprisingly perhaps, only a quarter of multidimensionally poor people and just one-third of severely multidimensionally poor people live in the world’s poorest countries – meaning Low Income Countries (LICs) or Least Developed Countries (LDCs).
Since late 2010 a set of papers have outlined a ‘new geography of poverty’ – meaning the shifting ‘location’ of poverty away from low-income countries or the Least Developed Countries. Indeed, three-quarters of the world’s poor – around a billion people – live in middle income countries. This paper has updated the global distribution of poverty using multidimensional measures and compared distribution based on MPI poor and MPI severe poor with those made with $1.25 and $2 poverty.
The sensitivity of findings about country thresholds for low and middle-income countries is discussed. The paper argues that there is a split of distribution poverty between both stable Middle-Income Countries (MICs) and low-income fragile states and that there is a ‘multidimensional bottom billion’ living in stable MICs.
The analysis is based on 83 countries and uses the 2011 MPI poverty estimates of the UNDP HDR.
Key findings:
- Three-quarters of the world’s MPI poor and two-thirds of the world’s severe MPI poor live in middle income countries – at total of one billion MPI poor in stable MICs. Further, there is a three-way split of the world’s poor between (i) stable MICs; (ii) India and China; and (iii) low income fragile states.
- The shift in global poverty can be interpreted in two ways that are not necessarily mutually exclusive. The first is that the country analytical categories are moribund. The second is that, over time, extreme poverty is becoming less about a lack of resources and increasingly about national inequality, growth patterns, and voice/governance – especially related to public finances.
- The findings suggest that an alternative to the categorisation of countries by LICs and MICs that is worth exploring might be a categorisation by the level of intensity of multidimensional poverty, because the country analytical categories are disconnected from the geographic location of poverty. Countries do not, of course, suddenly change when they cross arbitrary thresholds, be these thresholds of income per capita or structural characteristics. However, aid agencies do treat countries differently if they are middle income.
- Further, that poverty in (some) MICs may no longer be about a lack of resources but about issues of politics/distribution/allocation of public finances. Thus, the changing pattern of global poverty raises various questions that are about whether ‘global poverty’ requires reframing now or in the next decade as a national distribution issue in a world of fewer and fewer aid-dependent countries and/or whether the dominant analytical country categories are outdated.
- What next? First, the country categories of LICs and MICs are no longer a clear guide to where the poor live. However, the picture of poverty in MICs is not sensitive to the current thresholds – such thresholds could be drastically increased and the poor would still live in middle income countries. This would suggest that an alternative to the categorisation of countries by LICs and MICs worth exploring might be a categorisation by the level or intensity of multidimensional poverty. Second, in terms of future research, a hypotheses worth pursuing is one that posits that the nature of the global poverty ‘problem’ is changing to one of ‘poverty pockets’ or LICs within MICs, fragility within stable countries, and most importantly poverty within prosperity.
