An individual-centered approach to multidimensional poverty: The cases of Chile, Colombia, Ecuador and Peru

A. Franco-Correa

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Abstract

This paper deals with the problem of selecting the unit of analysis in
multidimensional poverty analyses, which is a central decision to take,
both from academic and normative points of view. The paper compares the
results of an individual-level Multidimensional Poverty Index for Chile,
Colombia, Ecuador and Peru with a household-based measure. In the
construction of the index, four dimensions were initially identified:
living conditions, health, education and labour. The motivating
theoretical framework is based on Sen's Capability Approach and the
index used is the Adjusted Headcount Ratio (AHR) of the Alkire-Foster
(2009) family of indicators. Different literature fields acknowledged
the fact that individuals have varying preferences depending on their
age (Osberg, 2012), which do not necessarily agree with the collective
preferences of the household. The present paper adopts Sen's approach,
noting that capabilities are mainly an individual concept. The
individual index is constructed using three age groups: children (less
than 18 years old), adults (between 18 and 59 years) and elderly (60
years or older). Multidimensional poverty is considerably different than
income poverty in all countries. A simple ranking constructed with the
Multidimensional Index and using the four countries for every individual
approach, shows that the ordering prevails for smaller levels of the
deprivation cut-off. In every scenario, Chile has the best scores of
multidimensional poverty, followed by Colombia. Differences between
Ecuador and Peru show that the rank-ordering does not prevail when the
unit of analysis or cut-offs change.
Original languageEnglish
Place of PublicationMaastricht
PublisherUNU-MERIT
Publication statusPublished - 1 Jan 2014

Publication series

SeriesUNU-MERIT Working Papers
Number068

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