Chen, ShaohuaRavallion, Martin2012-12-042012-12-042012-07https://hdl.handle.net/10986/11876Relative deprivation, shame and social exclusion can matter to the welfare of people everywhere. The authors argue that such social effects on welfare call for a reconsideration of how we assess global poverty, but they do not support standard measures of relative poverty. The paper argues instead for using a weakly-relative measure as the upper-bound complement to the lower-bound provided by a standard absolute measure. New estimates of global poverty are presented, drawing on 850 household surveys spanning 125 countries over 1981-2008. The absolute line is $1.25 a day at 2005 prices, while the relative line rises with the mean, at a gradient of 1:2 above $1.25 a day. The authors show that these parameter choices are consistent with cross-country data on national poverty lines. The results indicate that the incidence of both absolute and weakly-relative poverty in the developing world has been falling since the 1990s, but more slowly for the relative measure. While the number of absolutely poor has fallen, the number of relatively poor has changed little since the 1990s, and is higher in 2008 than 1981.CC BY 3.0 IGOABSOLUTE POVERTYABSOLUTE POVERTY LINEABSOLUTE TERMSABSOLUTE VALUEAGGREGATE POVERTYAVERAGE INEQUALITYCHANGES IN POVERTYCHILD MORTALITYCONSUMER PRICE INDEXCONSUMPTION BEHAVIORCONSUMPTION DATACONSUMPTION EXPENDITURESCOUNTRY DATACOUNTRY INEQUALITYCOUNTRY LEVELCUMULATIVE DISTRIBUTIONCUMULATIVE DISTRIBUTION FUNCTIONDATA SETSDEVELOPED COUNTRIESDEVELOPING COUNTRIESDEVELOPING COUNTRYDEVELOPING WORLDDEVELOPMENT ECONOMICSDEVELOPMENT POLICYDEVELOPMENT REPORTDEVELOPMENT RESEARCHECONOMIC CONTRACTIONECONOMIC GROWTHECONOMICSEMPIRICAL EVIDENCEEMPIRICAL RESULTSESTIMATED COEFFICIENTSFOOD PRICEFOOD PRICESFOOD SHAREFUNCTIONAL FORMGINI INDEXGLOBAL MARKETSGLOBAL POVERTYGROWTH RATEGROWTH RATESHIGH INEQUALITYHIGHER INEQUALITYHOUSEHOLD CONSUMPTIONHOUSEHOLD CONSUMPTION PER CAPITAHOUSEHOLD INCOMEHOUSEHOLD SIZEHOUSEHOLD SURVEYHOUSEHOLD SURVEYSIMPACT ON POVERTYINCIDENCE OF POVERTYINCOMEINCOME DISTRIBUTIONINCOME POVERTYINEQUALITYINEQUALITY MEASURESINFLATION RATEINTERNATIONAL POVERTY LINELIVING STANDARDSLOW INEQUALITYMEASUREMENT OF POVERTYMEASURING POVERTYMICRO DATANATIONAL ACCOUNTSNATIONAL POVERTYNATIONAL POVERTY LINESPER CAPITA CONSUMPTIONPER CAPITA EXPENDITUREPOLICY ANALYSISPOLICY RESEARCHPOORPOOR COUNTRIESPOOR PEOPLEPOPULATION SHAREPOST-REFORMPOVERTY ASSESSMENTSPOVERTY COMPARISONSPOVERTY GAPPOVERTY GAP INDEXPOVERTY INCIDENCEPOVERTY LEVELPOVERTY LINEPOVERTY MEASUREPOVERTY MEASUREMENTPOVERTY MEASURESPOVERTY RANKINGSPOVERTY RATEPOVERTY RATESPOVERTY REDUCTIONPOVERTY REDUCTION STRATEGYPOVERTY REDUCTION STRATEGY PAPERSREAL INCOMESREGIONAL AUTHORITIESREGIONAL DIFFERENCESREGIONAL POVERTYREGIONAL PROFILERICH COUNTRIESRURALRURAL AREASRURAL POVERTYRURAL POVERTY LINESSIGNIFICANT CORRELATIONSOCIAL NORMSURBAN AREASWorld Bank10.1596/1813-9450-6114