Publication Details

New poverty lines in India

the last hurrah?

Richard Palmer-Jones
Amaresh Dubey
2010

Abstract

Poverty is a widely respected indicator of well?being, which is used to make comparisons of poverty overtime and between spatial and social groups for the purposes of policy analysis. Several multilateral institutions have promoted methods based on household expenditure surveys of computing povertylines and poverty (Klugman (World Bank), 2002; UNStats, 2005; Ravallion, 1992) and such methods arewidely used. Generalising, these methods involve computing an anchor based on a costed set of basicneeds goods (CBN) and applying Consumer Price Indexes (CPI) to them to arrive at poverty lines for different domains. While not taking tutelage from these organizations, poverty in India is computed inquite similar ways. Reports based on these methods are influential in policy discourses, but are conceptually and empirically unconvincing.

This paper will review recent developments in poverty measurement This paper will review recent developments in poverty measurement by the Tendulkar Expert Group(Tendulkar et al., 2009), which have resulted in adoption of new poverty lines by the Indian Planning Commission, against the background of both previous poverty measurements in India and the methods proposed by other organizations. This method is rather different to the CBN approach advocated andapplied by the World Bank and UN Stats as superior to the FEI method often used by National Statistical Agencies (Ravallion, 1992). However, the devil is to a large extent in the detail. The paper points to thelimitations of these methods as Cost of Living Poverty Line Indexes (COLI) for different domains, whichmean that the new poverty lines and the poverty counts that derive from them cannot be confidently taken as comparable measures which can be used as indicators of the outcomes of policies that are likely to affect them, and so are not useful measures for the purpose of policy analysis. For the Tendulkar Group and other would be poverty measurers, it would be better to recognize the conceptual problems of current methods and data, and to set in motion less blinkered research and data production.

Publication Type(s)

Conference Paper

Ten Years of War Against Poverty Conference Papers

Conference: Ten Years of War Against Poverty

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