International Comparisons of Poverty in South Asia

Asian Development Review 38:1

34 Pages Posted: 27 Apr 2021

Multiple version iconThere are 2 versions of this paper

Date Written: March 25, 2021

Abstract

This paper explores the methodological differences underlying the construction
of the national consumption aggregates that are used to estimate international
poverty rates for South Asian countries. The analysis draws on a regional dataset
of standardized consumption aggregates to assess the sensitivity of international
poverty rates to the items included in the national consumption aggregates.
A key feature of the standardized aggregate is that it includes the reported
value of housing rent for urban Indian homeowners. Using the standardized
consumption aggregates reduces the international poverty rate in South Asia
by 1.3 percentage points, impacting the status of about 18.5 million people.
Comparing standardized and nonstandardized monetary welfare indicators to
other nonmonetary indicators suggests that the latter are more consistent
with the standardized consumption aggregates. Overall, the results strongly
suggest that harmonizing the construction of welfare measures, particularly
the treatment of imputed rent, can meaningfully improve the accuracy of
international poverty comparisons.

Keywords: Bangladesh, consumption aggregate, imputed rent, India, poverty measurement, South Asia

JEL Classification: I32

Suggested Citation

Islam, T. M. Tonmoy and Newhouse, David Locke and Yanez Pagans, Monica, International Comparisons of Poverty in South Asia (March 25, 2021). Asian Development Review 38:1, Available at SSRN: https://ssrn.com/abstract=3834489

T. M. Tonmoy Islam (Contact Author)

Elon University ( email )

Elon, NC 27244
United States

HOME PAGE: http://www.tmtonmoyislam.com

David Locke Newhouse

World Bank ( email )

1818 H Street, NW
Washington, DC 20433
United States

Monica Yanez Pagans

World Bank ( email )

1818 H Street, NW
Washington, DC 20433
United States

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