What is the International Poverty Line, and based on this measure, how many people are living in extreme poverty in the world?
The International Poverty Line is set at $1.90 per person per day, using 2011 Purchasing Power Parity conversion factors. Nearly 800 million people globally lived under this line in 2013 (based on the latest available data).
Why is the last global poverty figure from 2013?
Despite progress, there are still large gaps in poverty data in several countries. This has repercussions for global poverty monitoring, as country-level data are aggregated up to calculate global estimates, and there needs to be a minimum amount of data coverage in order to produce a reliable global estimate. At the World Bank, we produce regional estimates only if there are data for more than 40 percent of a region’s population.
Given these survey gaps and the fact that extreme poverty does not generally change much from year to year, we will, for the foreseeable future, produce global poverty estimates every two years. The next estimates will come out in fall 2018, at which time we will report for 2015.
Is the World Bank changing the global poverty line again?
No. For the foreseeable future, the World Bank will continue to track global extreme poverty using the International Poverty Line, $1.90 per person per day in 2011 PPP conversion factors. In each country, the line will be updated only in line with inflation. This is the standard against which progress on the World Bank Group’s goals and Sustainable Development Goal 1 is measured.
What are these new global lines that the World Bank is releasing?
In Fall 2017, the WBG introduced two complementary global poverty lines: the lower-middle-income poverty line at $3.20 and the upper-middle-income poverty line at $5.50 per person per day. These are designed to complement, not replace, the International Poverty line, and can be used as a benchmark for countries across the world whose level of development makes the International Poverty Line of more limited use in gauging levels of poverty and making comparisons between more developed economies.
Whereas previously, middle-income regions such as Europe and Central Asia (ECA) and Latin America and the Caribbean (LAC) had to develop their own regional poverty lines to allow for this higher standard of living, these new global lines will allow for countries in different regions to compare themselves to one another, and for lower- and upper-middle income countries to use a global poverty line that may be more appropriate for their context.
What happened to the poverty lines in LAC and ECA?
Previously, middle-income regions such as ECA and LAC had to develop their own regional poverty lines to allow for higher standard of living, since the International Poverty Line was too low to really capture poverty in their context. These new global lower- and upper-middle-income lines will replace the regional poverty lines, and allow regions to track their progress using poverty lines that are comparable across the world, not just within a region. This also will help more developed countries in different regions to compare themselves to one another using a global poverty line that may be more appropriate for their level of development.
Should I use these global poverty lines to plan programs and policies in my country?
A country’s national poverty line is generally the most appropriate for underpinning policy dialogue or targeting programs to reach the poorest.
Global poverty lines (expressed in US dollars using 2011 Purchasing Power Parity conversion factors) are used primarily to track global extreme poverty, to compare countries to one another, to create regional poverty estimates, and to measure progress on global goals set by the World Bank, the United Nations, and other development partners. As such, they can be useful, but are not generally the predominant measure used within a country to plan programs and policies.
Where can I find the latest poverty and inequality data for the world, a country, or a region?
For top-line poverty and inequality measures and Country Poverty Briefs, visit the Poverty and Equity Data Portal. If you would like to dig further in to the data, visit PovCalNet. For all other data, visit the World Bank Group's data page.
Don’t these lines put too much emphasis on money? What about the other dimensions of poverty?
The World Bank Group's approach to fighting poverty recognizes that investments and policies in a broad set of areas from education and health and sanitation, to infrastructure and environment, to fiscal policy and private sector development, must work together to create the conditions for people to move themselves up and out of poverty.
While global extreme poverty measures currently reflect monetary deprivations, there are many non-monetary indicators—on education, health, sanitation, access to water and electricity, etc.—that are extremely important for understanding people's experience of poverty. These are an important complement to monetary measures of poverty and are crucial to effectively improving the lives of the poorest.
Following the recommendations of the Atkinson Commission on Global Poverty, the World Bank is in the early stages of developing a multidimensional indicator that combines non-monetary dimensions of poverty, such as education, health, and sanitation, with existing monetary measures of poverty. This will not only provide a measure that has added value, but also allow us to look at the overlaps between the deprivations that people face, in order to better target interventions to those who are the most in need. We expect the first results of this work to be available in Fall 2018.
Why is the World Bank introducing more poverty indicators?
In 2015, just after the last update of the International Poverty Line, the then World Bank Chief Economist convened a commission of experts, led by Sir Tony Atkinson, to assess the Bank’s approach to poverty measurement, and to provide recommendations on how to improve upon and complement existing work.
The resulting report from the Atkinson Commission on Global Poverty, published in fall 2016, included 21 recommendations. The WBG has committed to adopting the majority of these recommendations, in the three main areas described below.
- Facilitating communication on global poverty updates
- The WBG will continue to track global poverty at $1.90 per day, the standard for both the institution’s goals and Sustainable Development Goal 1.1, but will from now on refer to it as the International Poverty Line.
- The International Poverty Line will not be updated using the next PPP conversion factors, but will instead be adjusted over time using national measures of inflation. This avoids confusion and methodological concerns that have surrounded previous updates to the global poverty line.
- Expanding indicators for greater relevance as countries develop
- In Fall 2017, the WBG will introduce two complementary global poverty lines, at $3.20 and $5.50 per person per day, which can be used as a benchmark for countries across the world whose level of development makes the International Poverty Line of little use. Whereas previously, middle-income regions such as ECA and LAC had to develop their own regional poverty lines to allow for their higher standard of living, these new global lines will allow countries in different regions to compare themselves to one another, and for lower- and upper-middle income countries to use global poverty lines that are more appropriate for their context.
- In Fall 2018, the WBG will report a complementary global poverty rate using a societal poverty line, the value of which goes up alongside a country’s level of development. This line combines absolute and relative measures of poverty to take a broader view of what poverty means in different contexts around the world, and will only be reported at the global (not country) level.
- Also in Fall 2018, the WBG expects to report on multidimensional poverty in a subset of countries, recognizing that while global extreme poverty measures currently reflect only monetary deprivations, there are many non-monetary aspects of welfare—education, health, sanitation, water, electricity, etc—that are extremely important for understanding people's experience of poverty. The WBG’s new indicator will combine non-monetary dimensions of poverty with existing monetary measures of poverty, providing a measure that not only adds value, but also allows us to look at the different types of deprivations that people face and to better target interventions toward those who are the most in need.
- Anchoring poverty measurement more closely to the country context
- As of Fall 2017, the WBG will produce annual two-page Country Poverty Briefs highlighting poverty, shared prosperity, and inequality trends, and giving the context of the poverty story. These briefs will also explain any difference (if present) between national and international poverty trends. These will be accompanied by a revamped data portal to make poverty, equity, and inequality data more straightforward and accessible to users.