Estimating International Poverty Lines from Comparable National Thresholds
36 Pages Posted: 20 Apr 2016 Last revised: 21 May 2020
Date Written: March 17, 2016
World Bank's international poverty line of $1.90/day, at 2011 purchasing power parity, is based on a collection of national poverty lines, which were originally used to set the international poverty line of $1.25/day at 2005 purchasing power parity. This paper proposes an approach for estimating a more recent, complete, and comparable collection of national poverty thresholds from reported national poverty rates. The paper presents a set of international poverty lines based on this new database of national poverty lines. In contrast to the lines used to estimate the $1.90 international poverty line, this approach produces national poverty lines that are (1) consistent with national poverty rates, (2) expressed in common units, and (3) provide greater support to the estimated international poverty line. These national poverty lines are used to estimate an extreme international poverty line, and three higher lines that are more relevant for higher-income countries. A key finding provides evidence of the robustness and relevance of the $1.90 international poverty line as a measure of extreme poverty for low-income countries.
Keywords: Inequality, Inflation, Poverty Reduction Strategies, Poverty Diagnostics, Poverty Monitoring & Analysis, Poverty Lines, Poverty Impact Evaluation, Small Area Estimation Poverty Mapping, Poverty Assessment, Economic Theory & Research, Economic Growth, Industrial Economics
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