ECO DEV 3.2

• The most widely used income poverty line internationally is the ________ measure or more precisely ________ at their 1985 value

  one dollar a day OR 370 US dollars per year
• The World Bank updated the global poverty lines in ____.

  September 2022
• The new extreme poverty line of $_______, which replaces

  the $_____, is based on _____ PPPs.

  2.15 per person per day AND 1.90 poverty line AND 2017
• usually changes the income distribution in a country –

  the extra pieces of the growing cake are not distributed to all members of

  society in shares equal to their initial shares of the cake.

  Economic growth
• is often due to, and/or accompanied by, new market

  opportunities.

  Economic growth
• If there is no macro-level evidence for systematic changes in income

  distribution during economic growth, we can expect _____ to facilitate

  poverty reduction.

  growth
• HE notes on his discussion of the Human Development

  Reports, that ‘arguably the biggest problem facing the world’s poor today is

  not “_______” – in HDR terms – but too little growth of even quite

  normal quality!’

  Ravallion AND low quality growth
• sometimes important to know not only the size of income a person has, but

  its factor share distribution (____). E.g. what fraction of

  income labor vs. capital receive.

  functional inequality
• gives additional, more detailed information on inequality in a country.

  Functional inequality
• the _________ give idea about relative poverty

  INEQUALITY MEASURES
• (how much income

  people in a country have relative to each other)

  relative poverty
• the number of people unable to satisfy some basic

  needs

  absolute poverty
• minimum amount of income (PPP

  adjusted) that can be used to compare poverty internationally; typically $1 a

  day or $2 a day.

  poverty line
• the

  proportion of people below PL from the whole population.

  headcount index (ratio)
• (the number of people below the PL)

  Headcount
• why poverty line? Simple. But there are issues: e.g. it matters if most people

  are right below it, or far from it (_______ can result from that, explain)

  policy bias
• to measure the amount of poverty more precisely (instead of the binary

  measure of being below or above the PL) we use another measure WHICH IS?

  total poverty gap (TPG)
• measures the total amount of income necessary to lift everyone below

  the PL to that line

  total poverty gap (TPG)
• argues poverty should be measured in terms of three deprivations:

  United Nations Development Programme
• three deprivations

  of life, of basic education, AND of overall economic provisioning
• (the % of people unlikely to live beyond 40 years of age)

  of life
• (the % of adults who are illiterate)

  of basic education
• (% of people without access to safe water +

  % of children underweight for their age)

  of overall economic provisioning
• COUNTRIES THAT perform better on HPI.

  Nigeria, Nicaragua, Bolivia, AND Tanzania