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Global Multidimensional Poverty Index

Context:

About 41.5 crore people exited poverty in India during the 15-year period between 2005-06 and 2019-21, out of which two-third exited in the first 10 years, and one-third in the next five years, according to the global Multidimensional Poverty Index (MPI).

Relevance:

GS III: Indian Economy (Growth and Development)

Dimensions of the article:

  1. What is multidimensional poverty?
  2. Multidimensional Poverty Index (MPI)
  3. Global Multidimensional Poverty Index (MPI)
  4. Highlights of the Report

What is multidimensional poverty?

  • Multidimensional poverty refers to the multiple deprivations that poor people face on a daily basis, such as poor health, a lack of education, insufficient living standards, disempowerment, low employment quality, the fear of violence, and living in ecologically hazardous places, to name a few.
  • In order to formulate policies aiming at alleviating poverty and hardship in a nation, a multidimensional measure of poverty might include a variety of indicators that represent the complexity of this phenomenon.

Multidimensional Poverty Index (MPI)

  • Multidimensional Poverty Indices use a range of indicators to calculate a summary poverty figure for a given population, in which a larger figure indicates a higher level of poverty.
  • This figure considers both the proportion of the population that is deemed poor, and the ‘breadth’ of poverty experienced by these ‘poor’ households, following the Alkire & Foster ‘counting method’.
The Alkire-Foster ‘counting method’
  • The Alkire-Foster (AF) method is a way of measuring multidimensional poverty developed by OPHI, which involves counting the different types of deprivation that individuals experience at the same time, such as a lack of education or employment, or poor health or living standards.
Positives and Criticism
  • MPI advocates state that the method can be used to create a comprehensive picture of people living in poverty, and permits comparisons both across countries, regions and the world and within countries by ethnic group, urban/rural location, as well as other key household and community characteristics.
  • MPIs are useful as an analytical tool to identify the most vulnerable people – the poorest among the poor, revealing poverty patterns within countries and over time, enabling policy makers to target resources and design policies more effectively.
  • Critics of this methodology have pointed out that changes to cut-offs and thresholds, as well as the indicators included and weightings attributed to them can change MPI scores and the resulting poverty evaluation.

Global Multidimensional Poverty Index (MPI)

  • The Global Multidimensional Poverty Index (MPI) was developed in 2010 by the Oxford Poverty & Human Development Initiative (OPHI) and the United Nations Development Programme and uses health, education and standard of living indicators to determine the incidence and intensity of poverty experienced by a population.
  • The Global MPI is released Annually by UNDP and OPHI and the results published in their websites.
  • The index is released at the High-Level Political Forum (HLPF) on Sustainable Development of the United Nations.
Parameters

Global MPI is computed by assigning scores for each surveyed household on 10 parameters.

  • Nutrition,
  • Child mortality,
  • Years of schooling,
  • School attendance,
  • Cooking fuel,
  • Sanitation,
  • Drinking water,
  • Electricity,
  • Housing,
  • Household assets.

Highlights of the Report:

  • The incidence of poverty fell from 55.1% in 2005-06 to 16.4% in 2019-21 in the country and that deprivations in all 10 MPI indicators saw significant reductions as a result of which the MPI value and incidence of poverty more than halved.
  • Improvement in MPI for India has significantly contributed to the decline in poverty in South Asia and it is for the first time that it is not the region with the highest number of poor people, at 38.5 crore, compared with 57.9 crore in Sub-Saharan Africa.
    • The report doesn’t fully assess the effects of the COVID-19 pandemic on poverty in India as 71% of the data from the National Family Health Survey-5 (2019-2021) relied upon for MPI were collected before the pandemic.
  • Bihar, the poorest State in 2015-2016, saw the fastest reduction in MPI value in absolute terms.
  • The incidence of poverty there fell from 77.4% in 2005-2006 to to 34.7% in 2019-2021.
  • Despite the strides made, the report notes that the ongoing task of ending poverty remains daunting.
  • India has by far the largest number of poor people worldwide at 22.8 crore, followed by Nigeria at 9.6 crore.
    • Two-third of these people live in a household in which at least one person is deprived in nutrition.
  • There were also 9.7 crore poor children in India in 2019-2021 — more than the total number of poor people, children and adults combined, in any other country covered by the global MPI.

-Source: The Hindu


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