Identification of the Poor in Sri Lanka: Development of Composite Indicator and Regional Poverty Lines

Abstract

The identification of the poor and the definition of poverty is rather complex since poverty dimensions are multifaceted. Poverty is not just an inadequacy of income to meet basic needs or the inability to spend. It is largely associated with numerous demographic, socio-economic, cultural, environmental, health and psychological factors. The aim of this study is therefore to compute a composite indicator of multidimensional poverty and regional poverty lines to identify the severity of poverty and regional disparities of poverty. The study was based on the two data sets and the main objectives of the study are: identification of the poor by using a broader definition of poverty; measurement of regional differences on poverty using the poverty indices and constructed poverty lines; and development of a Composite Indicator of Multidimensional Poverty to identify poverty by severity and also to examine regional disparities of poverty.

Keywords: Inequality, Basic Needs, Living Standards, Quality of Life, Measurement of Poverty, Welfare

JEL Classification: D63, I31, I32, I38, P46