The Asian Development Bank (ADB) has released a report that offers a new way to measure poverty in the Asia and Pacific region. It calculates the Asian Poverty Line at around US$1.35 a day. The report, published in a special chapter ofKey Indicators 2008 describes important methodological issues involved in generating internationally comparable estimates of poverty. A special chapter, titled Comparing Poverty Across Countries: The Role of Purchasing Power Parities, also provides comparable rates of poverty using price data specific to the Asia and Pacific region, and, critically, to the poor.
Ifzal Ali, ADB Chief Economist says, “While the US$1-a-day poverty line remains an appropriate benchmark for counting the extent of extreme poverty in Asia, and the developing world more generally, in a region that has witnessed rapid economic growth it might also be time to evaluate poverty incidence using a benchmark that reflects the region’s dynamism.”
A major contribution of the report is to examine the sensitivity of poverty estimates to different methods for evaluating purchasing power parities (PPP). PPPs are conversion factors that ensure a common purchasing power over a given set of goods and services. Using consumption… [click here to read the rest of this article...]
