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

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Achieving Accurate Poverty Estimates

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In pursuit of addressing poverty, measuring it through a single lens—typically income or consumption—has long been the norm. However, the limitations of such unidimensional metrics have led to the emergence of multidimensional poverty indices, seeking to capture the complex interplay of factors that contribute to deprivation. The multidimensional poverty index (MPI) is a widely used tool that captures various dimensions of poverty, including health, education, and standard of living. While these indices, such as the MPI, offer a more holistic view, recent critiques of the methodology employed by institutions like the NITI Aayog in India underscore the need for revised estimates and a re-evaluation of poverty lines.

The arguments against current multidimensional poverty measurement metho­dologies highlight various methodological shortcomings. These include the arbitrary selection of indicators, the absence of key dimensions in health and education, and the questionable inclusion of certain indicators like “access to banking” in assessing the standard of living. These critiques point to a lack of precision in capturing the intricacies of poverty, urging a reconsideration of the chosen parameters and their weights in the index.

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