CLEVELAND, Ohio — A recent release by the Oxford Poverty and Human Development Initiative found that the number of people living in extreme poverty is 400 million higher than the World Bank estimate from 2010. The 1.6 billion people were counted using a multidimensional poverty index (MPI). This analysis included more variables than the World Bank poverty formula.
The World Bank’s formula was based on an absolute poverty measurement of less than $1.25 a day and results were compared by country. The Oxford Poverty and Human Development Initiative (OPHI) included other quality of life variables in their equation. This new equation includes data on access to healthcare, education and living standards, which were analyzed on a regional level allowing more accuracy as to the location. This is highly useful information for aid organizations and government programs which will benefit from being able to target aid efforts more precisely.
The formula works by changing the U.N.’s absolute poverty line into a basic needs approach. This reclassification of “in poverty” is measured through several indicators or factors in quality of life. In order to be classified as “in poverty,” the individual must be deprived in multiple indicators and these measurements must add up to a total of 33 percent “deprivation,” as termed by the authors of the study.
Utilizing three separate data sets from the Demographic and Health Survey, the Multiple Indicators Cluster Survey and the World Health Survey, all measuring quality of life factors, the authors compiled a more precise count of people “in poverty.” OPHI then developed an index that gathered data on 10 necessities or subtopics for each of the three broad indicators. If an individual is classified as “in poverty,” this means they are lacking at least one third of these quality of life factors or indicators.
The new formula calculated that more than half of the world’s impoverished people live in South Asia and another 29 percent live in sub-Saharan Africa. Niger has the highest proportion of the multi-dimensionally poor in the world, comprising 90 percent of the country’s population.
The index also revealed good news in regards to Nepal, Rwanda, Ghana, Cambodia and Bangladesh. Nepal has reduced its MPI count from a 65 to 44 percent concentration and the other listed countries have all seen improvement in quality of life indicators.
– Christopher Kolezynski