ISSN (Print) - 0012-9976 | ISSN (Online) - 2349-8846

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How Many Poor in the World?

How reliable are the World Bank's widely cited estimates of global poverty?

What is it that is actually available to the interested consumer of statistics on global poverty? Given constraints of space, it would be excusable to confine oneself to two salient sets of work in this area. First, we have a sequence of poverty estimates put out by the World Bank that have been prepared by members of its staff. Second, we have a sequence of critiques of the World Bank’s work that have led to responses and counterresponses. The World Bank earlier this year came out with new and revised estimates of national and global poverty, estimates that have attracted a considerable amount of attention. (Three articles in this issue of the journal discuss the World Bank’s numbers.)

The World Bank has so far come up with three sets of global poverty estimates, all of these being headcount ratios of the population living below poverty lines specified in the money metric. The first, carried in the World Development Report (w d r) 1990, employed a poverty line of $ 1 (actually $ 1.02) per day at 1985 purchasing power parity (PPP) on the basis that the domestic poverty lines of eight of the poorest countries in the world clustered around this figure. The second, carried in the 2000-01 wdr, employed a poverty line of $ 1.08 per day at 1993 PPP, which was the median of the poverty lines of the 10 poorest countries. The third set of estimates, released in a recent World Bank working paper, employs a poverty line of $ 1.25 per day at 2005 PPP, this – in yet another innovative justification – being the average of the national poverty lines (in terms of consumption per capita) of the poorest 15 countries of the world.

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