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Multidimensional Poverty Index Sabina Alkire and Maria Emma Santos, July 2010

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Multidimensional Poverty Index Sabina Alkire and Maria Emma Santos, July 2010 OPHI Oxford POVertY & HumaN DEVELopmeNT INitiatiVE www.ophi.org.uk Multidimensional Poverty Index Sabina Alkire and Maria Emma Santos, July 2010 Key Findings Research Brief ■ Half of the world’s MPI poor people live in South Asia; and just over a The Oxford Poverty and Human Development Initiative (OPHI) quarter in Africa. has developed a new international measure of poverty – the ■ People living in MPI poverty may Multidimensional Poverty Index or MPI – for the 20th Anniversary not be income poor. For example, edition of the United Nations Development Programme’s flagship only two-thirds of Niger’s people are income poor, whereas 93% are Human Development Report. The new innovative index goes beyond poor by the MPI. a traditional focus on income to reflect the multiple deprivations ■ Multidimensional poverty varies that a poor person faces with respect to education, health and living a lot within countries. In Kerala, standard. This brief summarises the new method and key findings and India 16% of people are MPI poor; shows how the MPI can be used. compared to 81% in the Indian state of Bihar. The MPI assesses the nature and Income intensity of poverty at the individual What does it mean to live in ■ The composition of poverty level, with poor people being those poverty? This question has often varies. We found five ‘types’ of multidimensional poverty among who are multiply deprived and the been answered by lack of income, the countries, each of which extent of their poverty being measured but the traditional narrow focus on require different policy responses. by the extent of their deprivations. The income as the only measure of a MPI creates a vivid picture of people person’s wellbeing, or lack of it, is ■ Ethiopia reduced MPI poverty living in poverty within and across being increasingly challenged. Recent by improving nutrition and water, countries, regions and the world. high profile initiatives, such as the whereas Bangladesh improved It is the first international measure Stiglitz-Sen-Fitoussi Commission, it by sending children to school. Ghana improved several aspects of its kind, and offers an essential have called for broader measures that of MPI poverty at once. complement to income poverty take account of other vitally important measures because it measures aspects of life. ■ Although limited by data, the MPI deprivations directly. The MPI can be The human development approach is robust. 95% of the rankings do used as an analytical tool to identify has long argued that although not change if we look at people the most vulnerable people, show income is important, it needs to who are poor in as little as 20% or aspects in which they are deprived be complemented by more direct as many as 40% of deprivations. and help to reveal the interconnections measures (Anand and Sen 1997). among deprivations. This can enable In 2010, the 20th anniversary year policy makers to target resources and of the United Nations Development design policies more effectively. Programme’s flagship Human Oxford Poverty & Human OPHI has just concluded a first Development Report (UNDP HDR), Development Initiative (OPHI) ever estimate and analyses of global the HDR is introducing a new Department of International Development multidimensional poverty in 104 international measure of poverty – the Queen Elizabeth House (QEH) developing nations across the world Multidimensional Poverty Index or University of Oxford, Mansfield Road using existing household survey data. MPI – which directly measures the Oxford OX1 3TB UK Tel: +44 (0)1865 271915 Other dimensions such as work, combination of deprivations that each Fax: +44 (0)1865 281801 safety, and empowerment could be household experiences. The new Email: [email protected] www.ophi.org.uk incorporated into the MPI in the future MPI supplants the Human Poverty as data become available. Index or HPI used in previous Human OPHI gratefully acknowledges support from the This brief summarises key Development Reports. International Development Research Centre (IDRC) in Canada, the Canadian International Development findings of the new index and shows The MPI looks at poverty through Agency (CIDA), Australian Agency for International how the measure can be used by a ‘high-resolution’ lens. By directly Development (AusAID), the UK Department for International Development (DFID), Doris Oliver governments, development agencies, measuring the nature and magnitude Foundation, Global Giving, Kim Samuel-Johnson and other institutions to help eradicate of overlapping deprivations at the and anonymous benefactors. acute poverty. household level, the MPI provides Multidimensional Poverty Index July 2010 information that can help to inform very easy to calculate and interpret, is better policies to reduce acute poverty. Inside the MPI intuitive yet robust, and satisfies many The MPI is the first international 1. Education (each indicator is desirable properties. measure to reflect the intensity of weighted equally at 1/6 ) Better data are needed at the poverty – the number of deprivations • Years of Schooling: deprived if international level to be able to expand that each household faces at the same no household member has com- the measure to include other important time. pleted five years of schooling dimensions, such as informal work, From their inception, the UNDP • Child Enrolment: deprived if any empowerment and safety from school-aged child is not attend- violence, in the future. HDRs have pioneered new ways to ing school in years 1 to 8 analyze human development and By directly measuring the different poverty, intended to have a direct 2. Health (each indicator is weighted types of poverty in each household, impact on development strategy equally at 1/6) the MPI goes beyond the HPI and and methodology. By featuring • Child Mortality: deprived if any other poverty measures to capture child has died in the family this independently conceived new how different • Nutrition: deprived if any adult or approach to poverty measurement in child for whom there is nutritional groups of people the 20th anniversary report, UNDP information is malnourished experience HDR hope to encourage its use by concurrent (each indicator governments, development agencies, 3. Standard of Living deprivations. is weighted equally at 1/18) Take Tabitha, and other institutions dedicated to the • Electricity: deprived if the eradication of acute poverty. household has no electricity who is 44 years It can be decomposed by • Drinking water: deprived if the old and lives in population group and broken down household does not have access Lunga Lunga by dimension. The full results and to clean drinking water or clean slum just outside Tabitha detailed information on the index can water is more than 30 minutes of Kenya’s be found in: Alkire, S. and Santos, walk from home capital, Nairobi. Tabitha lives with her M.E. (2010). Acute Multidimensional • Sanitation: deprived if they do husband and their six children. Her not have an improved toilet or if husband has no permanent work so Poverty: A New Index for Developing their toilet is shared Countries. Oxford Poverty and Human • Flooring: deprived if the house- she is the main breadwinner for the Development Initiative Working Paper hold has dirt, sand or dung floor family. She depends on casual jobs, 38. Available at: http://www.ophi.org. • Cooking Fuel: deprived if they including washing clothes for others in uk/publications/ophi-working-papers/. cook with wood, charcoal or dung the neighbourhood, where she is paid Also see www.ophi.org.uk. • Assets: deprived if the house- Ksh 50 per wash (US $1.65). When no hold does not own more than one one has clothes to be washed, Tabitha Multidimensional Poverty Index of: radio, TV, telephone, bike, or goes to the nearby rubbish dump motorbike, and do not own a car and finds old clothes to sell to a local (MPI): Basic Overview or tractor The MPI is an index of acute clothes recycling dealer who buys 1kg multidimensional poverty. It reflects presented in ‘Inside the MPI’ (above). of clothing for Ksh 10 (US $0.33). On deprivations in education to health The indicators are based on a good day, Tabitha can manage to outcomes to assets and services for participatory exercises with poor collect 1-5kg (total; US $0.33-1.65) of people across 104 countries. Although people, emerging international clothes from the rubbish. deeply constrained by data, the MPI consensus and the availability of Despite having such a low income, reveals a different pattern of poverty suitable data. Most are linked to Tabitha’s four school-aged children than income poverty, as it illuminates Millennium Development Goals. The attend the local school. She has high deprivations directly. The MPI has index mainly uses data from three hopes for her children as neither three dimensions: health, education, household surveys: the Demographic Tabitha nor her husband had the and standard of living. These are and Health Survey, the Multiple opportunity to go to school. “My hopes measured using 10 indicators. Poor Indicators Cluster Survey and the for the future are that I can support my households are identified and an World Health Survey. children to continue their education,” aggregate measure constructed using The MPI is the product of two she says. Tabitha worries that she will a methodology proposed by Alkire numbers: the and Foster (2007, 2009) (See box on Headcount H or page 7). Each dimension is equally percentage of weighted; each indicator within a people who are dimension is also equally-weighted. poor, and the The MPI reveals the combination of average intensity deprivations that batter a household of deprivation at the same time. A household is A – which reflects identified as multidimensionally poor the proportion if and only if it is deprived in some of dimensions in combination of indicators whose which households weighted sum exceeds 30% of all are, on average, deprivations.
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