How Many Chronically Poor People are There in the World? Some Preliminary Estimates

Abstract

This background paper provides some preliminary estimates of the global incidence of chronic poverty for the Chronic Poverty Report 2004-05. We define chronic poverty as remaining below the poverty line for at least five years, with welfare measured in expenditure or income terms. Using the latest estimates on the magnitude of static dollar a day poverty available from the World Bank and panel data estimates of the unconditional probabilities of the currently poor staying poor, we estimate the number of people who are chronically poor by region. This is an inherently imprecise exercise that suffers from both measurement error and the need to make a number of very strong assumptions. Nonetheless, our best "guesstimate" is that there were between 300 and 420m people worldwide living in chronic poverty in the late 1990s.

Keywords: international comparisons, data