Reading Development

Random readings on society, politics and change – Jorge Carrillo

Is the Devil in the Details? Estimating Global Poverty

Economists’ assumptions, even about seemingly “small” matters, make an enormous difference to global poverty estimates but their impact often goes unnoticed, and the choices made have been badly justified. We must stop pretending that the World Bank’s “$1 per day” estimates are at all reliable.

The existing framework for conceptualizing the problem and for collecting and processing data on this question has been and remains extremely weak, with minor modifications but no fundamental rethinking of the money-metric “$1-per-day” approach used in tracking the goals. Research has long been available that has pointed out problems in the methodology used, as well as the havoc generated by periodic collection of new price data, and proposing alternatives. Despite the criticisms by diverse researchers having triggered, among other things, a multi-million dollar effort to collect new price data relevant to poverty assessment, there has been little public discussion and no substantial change.

[Read article in website of the Institute of New Economic Thinking]

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This entry was posted on Sunday, 4 October 2015 by in Poverty and inequality and tagged , , , .
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