There is increasing agreement that it is important for poverty measures to reflect the multidimensional nature of poverty (Poverty Analysis Discussion Group, 2012). A number of commentators argue that aiming to reduce poverty using the USD 1.90 a day poverty measure ignores many overlapping disadvantages faced by people living in poverty, including malnutrition, poor sanitation, a lack of electricity, or ramshackle schools (Alkire and Sumner, 2013). Neither income nor expenditure measures capture these other aspects of household well-being such as the value of publicly provided goods (education or public health services); and intangibles such as peace and security (Haughton & Khandker, 2009; Poverty Analysis Discussion Group, 2012). As a result, multidimensional poverty measures have emerged that complement the USD 1.90 a day measure by including other deprivations.
There is some debate around multi-dimensional poverty measures between those who propose scalar indices that combine, in a single number, information from various dimensions and those who suggest a dashboard approach of a credible set of multiple indices (Ferreria & Lugo, 2012; Poverty Analysis Discussion Group, 2012). While it can be helpful to look at deprivation overall, there are also benefits to looking at issues separately to ensure policy is correctly targeted. Measures that combine multiple dimensions, such as the Multidimensional Poverty Index, also need greater clarity on what exactly is being measured and the trade-offs embodied in the index, as well as contextual factors and the sensitivity of the implied rankings to changing the data and weights (Ravallion, 2010). In addition, it isargued that neither of these approaches reveals the interdependence of the different dimensions in multidimensional poverty (Ferreria & Lugo, 2012).
The Multidimensional Poverty Index (MPI), now used in the Human Development Report, measures acute global poverty by beginning at the level of the person or household. It measures overlapping deprivations using a set of ten indicators in three dimensions ‒ health, education and living standards (see figure 3 below) ‒ and summarises the individual or household’s poverty profile with a weighted deprivation score. If more than three of the ten indicators are below the relevant poverty cut-offs, they are identified as multidimensionally poor (Alkire et al., 2013). It helps to capture how many people experience overlapping deprivations and of what intensity (how many deprivations they face on average). See Table 1 for the percentage of people living in multidimensional poverty in different regions.
Figure 3: Dimensions and indicators of the Multidimensional Poverty Index
- Health (each indicator is weighted equally at 1/6)
- Nutrition: deprived if any adult or child for whom there is nutritional information is malnourished
- Child mortality: deprived if any child has died in the family
- Education (each indicator is weighted equally at 1/6)
- Years of schooling: deprived if no household member has completed five years of schooling
- Child enrolment: deprived if any school-aged child is not attending school in years 1 to 8
- Standard of Living (each indicator is weighted equally at 1/18)
- Cooking fuel: deprived if they cook with wood, charcoal or dung
- Sanitation: deprived if they do not have an improved toilet or if their toilet is shared
- Drinking water: deprived if the household does not have access to clean drinking water or clean water is more than 30 minutes walk from home
- Electricity: deprived if the household has no electricity
- Flooring: deprived if the household has dirt, sand or dung floor
- Assets: deprived if the household does not own more than one of: radio, TV, telephone, bike, or motorbike, and do not own a car or tractor (Alkire and Santos, 2010, p. 2).
Multidimensional Poverty Index (MPI) 2015+ – a proposal for a new poverty measurement
An MPI 2015+ has been proposed by Alkire and Sumner (2013) for the post-2015 context. It would draw together Sustainable Development Goal indicators, as well as drawing on participatory processes to show how people are poor and the disadvantages they experience. They argue that this would help us gain an even richer picture of the true reality of poverty.
Table 1: Income and multidimensional poverty, by region
| Region | No. of countries in sample | Income (USD 1.25 a day) poverty headcount (%) | No. of countries in sample | Multidimensional poverty headcount (%) |
|---|---|---|---|---|
| Arab States | 10 | 6.5 | 9 | 15.5 |
| East Asia and the Pacific | 11 | 12.7 | 10 | 6.4 |
| Europe and Central Asia | 15 | 1.4 | 15 | 1.8 |
| Latin America and the Caribbean | 20 | 5.7 | 14 | 6.7 |
| South Asia | 8 | 30.6 | 7 | 53.4 |
| Sub-Saharan Africa | 40 | 50.9 | 36 | 59.6 |
Source: adapted from UNDP, 2014, p. 73
The MPI replaces the Human Poverty Index (HPI) previously used in the Human Development Report from 1997-2009. The HPI used country averages to reflect aggregate deprivations in health, education, and standards of living but did not measure poverty at an individual or household level.
The global Multidimensional Poverty Index 2016 provides multidimensional poverty data from 102 developing countries gathered by the Oxford Poverty & Human Development Initiative. It uses data on other aspects of poverty gathered by the Demographic and Health Survey (DHS), the Multiple Indicators Cluster Survey (MICS), and the World Health Survey (WHS).
OECD measures of well-being use existing objective data, as well as subjective data, that take account of peoples’ own aspirations and their evaluations of their experiences of development, and relational data looking at the quantity and quality of relationships (OECD, 2013). The addition of subjective well-being data can provide an important complement to other indicators already used; although the variety of factors which influence how people experience and report on their lives means subjective well-being on its own can only tell part of a person’s story (OECD, 2013b).
The Social Progress Index measures basic human needs (assessed by looking at nutrition and basic medical care, water and sanitation, and shelter and personal safety); foundations of wellbeing (assessed by looking at access to basic knowledge, access to information and communications, health and wellbeing, and ecosystem sustainability); and opportunity to progress (assessed by looking at personal rights; personal freedom and choice, tolerance and inclusion, and access to advanced education).
Measuring child poverty requires child-specific social indicators that can capture the multidimensional and interrelated nature of poverty. These measure the linkages between child deprivations in eight critical dimensions: education, health, nutrition, water, sanitation, shelter, information and income/consumption (UNICEF, 2011).
- Alkire, S., & Santos, M. E. (2010). Multidimensional poverty index. Oxford Poverty & Human Development Initiative.
- Alkire, S., & Sumner, A. (2013). Multidimensional poverty and the post-2015 MDGs. Development, 56(1), 46–51.
- Alkire, S., Roche, J. M., & Sumner, A. (2013). Where do the world’s multidimensionally poor people live? (Working Paper No. 61). Oxford Poverty & Human Development Initiative.
- Ferreria, F., & Lugo, M. A. (2012). Multidimensional poverty analysis: Looking for a middle ground (ECINEQ WP 2012 – 251). ECINEQ.
- Haughton, J., & Khandker, S. R. (2009). Handbook on poverty and inequality. Washington, DC: World Bank.
- OECD. (2013). Measuring well-being for development (Discussion paper for session 3.1). Paris: OECD.
- OECD. (2013b). OECD guidelines on measuring subjective well-being. Paris: OECD Publishing.
- Poverty Analysis Discussion Group. (2012). Understanding poverty and wellbeing – A note with implications for research and policy. London: DFID.
- Ravallion, M. (2010). Mashup indices of development (Policy Research Working Paper 5432). Washington, DC: World Bank.
- UNDP. (2014). Human development report 2014: Sustaining human progress: Reducing vulnerabilities and building resilience. New York: UNDP.
- UNICEF. (2011). A multidimensional approach to measuring child poverty. New York: UNICEF.
