4.2.1 - Absolute and relative poverty

• Absolute Poverty measures poverty that focuses on a fixed, minimum standard of living necessary for basic survival, usually expressed in terms of income or consumption
•  Relative poverty is a measure that considers a person's income or resources in comparison to the overall standard of living within their society. It is more concerned with inequality and social exclusion.
• Threshold:

  • Absolute Poverty: It has a specific threshold, often set as the income required to meet basic needs such as food, shelter, and clothing. The threshold is relatively constant.
• Threshold:

  • Relative Poverty: The threshold for relative poverty varies as it depends on the distribution of income or resources in a particular society. People are considered relatively poor if their income falls significantly below the median or average income in their society.
• Focus:

  • Absolute Poverty: It primarily focuses on meeting basic human needs and ensuring a minimum standard of living.
• Focus:

  • Relative Poverty: It focuses on the gap between the rich and the poor and the potential social exclusion that can result from income inequality.