Absolute Poverty When Necessity Displaces Desire
A new basis for an international poverty measurement is proposed based on linear programming for specifying the least cost diet and explicit budgeting for nonfood spending. This approach is superior to the World Bank’s $1-a-day line because it is (i) clearly related to survival and well being; (ii)...
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| Published in | The American economic review Vol. 107; no. 12; pp. 3690 - 3721 |
|---|---|
| Main Author | |
| Format | Journal Article |
| Language | English |
| Published |
Nashville
American Economic Association
01.12.2017
American Economic Assoc |
| Subjects | |
| Online Access | Get full text |
| ISSN | 0002-8282 1944-7981 1944-7981 |
| DOI | 10.1257/aer.20161080 |
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| Abstract | A new basis for an international poverty measurement is proposed based on linear programming for specifying the least cost diet and explicit budgeting for nonfood spending. This approach is superior to the World Bank’s $1-a-day line because it is (i) clearly related to survival and well being; (ii) comparable across time and space since the same nutritional requirements are used everywhere while nonfood spending is tailored to climate; (iii) adjusts consumption patterns to local prices; (iv) presents no index number problems since solutions are always in local prices; and (v) requires only readily available information. The new approach implies much more poverty than the World Bank’s, especially in Asia. |
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| AbstractList | A new basis for an international poverty measurement is proposed based on linear programming for specifying the least cost diet and explicit budgeting for nonfood spending. This approach is superior to the World Bank's $1-a-day line because it is (i) clearly related to survival and well being; (ii) comparable across time and space since the same nutritional requirements are used everywhere while nonfood spending is tailored to climate; (iii) adjusts consumption patterns to local prices; (iv) presents no index number problems since solutions are always in local prices; and (v) requires only readily available information. The new approach implies much more poverty than the World Bank's, especially in Asia. (JEL C61, I14, I31, I32, O15) A new basis for an international poverty measurement is proposed based on linear programming for specifying the least cost diet and explicit budgeting for nonfood spending. This approach is superior to the World Bank’s $1-a-day line because it is (i) clearly related to survival and well being; (ii) comparable across time and space since the same nutritional requirements are used everywhere while nonfood spending is tailored to climate; (iii) adjusts consumption patterns to local prices; (iv) presents no index number problems since solutions are always in local prices; and (v) requires only readily available information. The new approach implies much more poverty than the World Bank’s, especially in Asia. |
| Author | Allen, Robert C. |
| Author_xml | – sequence: 1 givenname: Robert C. surname: Allen fullname: Allen, Robert C. organization: Social Science, New York University Abu Dhabi, PO Box 129188, Abu Dhabi, United Arab Emirates, and Nuffield College, Oxford |
| BackLink | http://www.econis.eu/PPNSET?PPN=1012351866$$DView this record in ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften |
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| SubjectTerms | Budgets Consumption patterns Diet Economic theory Linear programming Measurement Poverty Prices Well being |
| Subtitle | When Necessity Displaces Desire |
| Title | Absolute Poverty |
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