Measuring Poverty Using Qualitative Perceptions Of Welfare

Subjective poverty lines - based on the self-assessed adequacy of a family's food, housing, and clothing - accord closely on average with independent objective poverty lines. There are notable differences, however, when geographic and demographic poverty profiles are constructed. Pradhan and Ravallion show how subjective poverty lines can be derived using simple qualitative assessments of perceived consumption adequacy, based on a household survey. Respondents were asked whether their consumption of food, housing, and clothing was adequate for their family's needs.Pradhan and Ravallion's approach, by identifying the subjective poverty line without the usual minimum-income question, offers wide applications in developing country settings. They implement it using survey data for Jamaica and Nepal.The implied subjective poverty lines are robust to alternative methods of dealing with other components of consumption, for which the subjective adequacy question was not asked.The aggregate poverty rates based on subjective poverty lines come close to those based on independent objective poverty lines.There are notable differences, however, when geographic and demographic poverty profiles are constructed.This paper - a product of Poverty and Human Resources, Development Research Group - is part of a larger effort in the department to improve methods of poverty measurement. Martin Ravallion may be contacted at [email protected].