1By Mal Warwick

How can we end poverty if we don’t even know how many poor people there are?

That’s why the headline for a June 19, 2014, article in The Atlantic by Tanya Basu caught my attention. It read simply “The U.N. Has Been Undercounting the World’s Poor—by 400 Million.” 

Basu was referring to the estimate by the United Nations Development Programme (UNDP) of the number of people who live in poverty because their income is $1.25 per day or lower. That’s the level at which the World Bank defines people as living in “extreme poverty.” (The definition of poverty more generally accepted by the World Bank and others is $2 a day or less. Paul Polak and Mal Warwick used this figure as the cut-off for the “bottom of the pyramid” in The Business Solution to Poverty.)

Dissatisfied with the UN’s definition as resting on income alone, a team of economists at the University of Oxford examined a range of “deprivations,” such as barriers to education, lack of access to healthcare, and so forth. Taking these measurements into account, the Oxford team produced what they call the Multidimensional Poverty Index, or MPI. 

“The [UNDP] has put [the poverty] figure at 1.2 billion people. But under the MPI’s measurements, it’s 1.6 billion people. More than half of the impoverished population in developing countries lives in South Asia, and another 29 percent in Sub-Saharan Africa.” 

Read the full article here

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