TY - JOUR
T1 - Absolute poverty
T2 - When necessity displaces desire
AU - Allen, Robert C.
N1 - Funding Information:
* Social Science, New York University Abu Dhabi, PO Box 129188, Abu Dhabi, United Arab Emirates, and Nuffield College, Oxford (email: [email protected]). This paper was accepted to the AER under the guidance of Pinelopi Goldberg, Coeditor. This research was supported through a research allowance provided by New York University Abu Dhabi. The main data sources for this article are the core price list for the International Comparisons Project 2011 and the regional price lists for Africa and Asia. I am grateful to the World Bank and Dr. Nada Hamadeh for access and support. These data are available to researchers upon application to the Director of the Data Development Group at the World Bank. See ICP Global Office, 2011 ICP Data Access and Archiving Policy: Guiding Principles and Procedures for Data Access, 2012, http://pubdocs.worldbank.org/ en/790491487172245068/121120-ICPDataAccessPrinciples-Procedures.pdf, pp. 6–7, for details on the application procedure. I am grateful to Ligita Visockyte for exceptional research assistance and to Mattia Fochesato for programming assistance. I thank Anthony Atkinson, François Bourguignon, Shaohua Chen, Angus Deaton, Erwin Diewert, Stefan Durcan, Ian Gazeley, Rob Feenstra, Francisco Ferreira, Pablo Hernandez, Alan Heston, Sara Horrell, Dean Jolliffe, Branko Milanovich, Michail Moatsos, as well as three referees and participants in several seminars for questions, comments, suggestions, and discussion.
PY - 2017/12
Y1 - 2017/12
N2 - A new basis for an international poverty measurement is proposed based on linear programming for specifying the least cost diet and explicit budgeting for nonfood spending. This approach is superior to the World Bank's $1-a-day line because it is (i) clearly related to survival and well being; (ii) comparable across time and space since the same nutritional requirements are used everywhere while nonfood spending is tailored to climate; (iii) adjusts consumption patterns to local prices; (iv) presents no index number problems since solutions are always in local prices; and (v) requires only readily available information. The new approach implies much more poverty than the World Bank's, especially in Asia.
AB - A new basis for an international poverty measurement is proposed based on linear programming for specifying the least cost diet and explicit budgeting for nonfood spending. This approach is superior to the World Bank's $1-a-day line because it is (i) clearly related to survival and well being; (ii) comparable across time and space since the same nutritional requirements are used everywhere while nonfood spending is tailored to climate; (iii) adjusts consumption patterns to local prices; (iv) presents no index number problems since solutions are always in local prices; and (v) requires only readily available information. The new approach implies much more poverty than the World Bank's, especially in Asia.
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U2 - 10.1257/aer.20161080
DO - 10.1257/aer.20161080
M3 - Article
AN - SCOPUS:85038614548
SN - 0002-8282
VL - 107
SP - 3690
EP - 3721
JO - American Economic Review
JF - American Economic Review
IS - 12
ER -