Diverging Identification of the Poor: A Non-Random Process – Chile 1992-2017
Posted: 24 Apr 2020
Date Written: February 24, 2020
Abstract
This paper investigates the degree of association in the identification of the poor between the standard monetary FGT poverty measure and the Alkire-Foster Multidimensional Poverty Index. For this purpose, we use a measure of redundancy in the identification of the poor between the two poverty measures (R0). In Chile, over the past 25 years, R0 has declined at a rate of 1.5% per year. The decline is unimportant during the 1990s, a decade of rapid economic growth, while it is notable thereafter, in a period characterized by modest economic growth and the progressive introduction and deepening of social policies. The conditional correlation between socio-economic and demographic characteristics with R0 is examined at the province and household levels. After controlling for the household non-eligibility across some of the indicators of the multidimensional poverty index, we find that the divergence in the identification of the poor seems to be a real process which is not randomly distributed across the population. It is correlated with education improvements, increasing urbanization, and reduction in household size. On the basis of our results, we argue that this divergence may be a more general phenomenon that tends to occur in countries undergoing demographic transition, urbanization, and progress in education. If so, and given the fact that poverty alleviation strategies are adopted partly on the basis of poverty statistics, the diverging identification of the poor might have distributive consequences for the poor.
Keywords: Multidimensional Poverty; Monetary Poverty; Identification of the Poor; Measures of Association; Household Ineligibility
JEL Classification: D63; I32
Suggested Citation: Suggested Citation
CESifo (Center for Economic Studies and Ifo Institute)
Poschinger Str. 5
Munich, DE-81679
Germany
HOME PAGE: http://www.CESifo.de
IZA Institute of Labor Economics
P.O. Box 7240
Bonn, D-53072
Germany