Chapter 2 – Monetary Poverty Richard Tonkin

Introduction Thank you to everyone who has contributed so far! Input from OECD, UNECE, CISSTAT, Russia, Georgia, Italy & Germany Structure follows that agreed at last meeting Aimed to integrate all contributions into initial draft Where touched on same issues, aimed to merge together Left out (for now) issues covered by other chapters (e.g. General definitions / subjective poverty) Only had time for relatively minimal editorial work Please excuse lapses in balance, typos etc. !

General questions Are there important issues that haven't been addressed? Or not enough detail? Any further issues that would benefit from case study/worked examples? Are there areas that overlap too much with other chapters? Or where less detail needed? What should be the main conclusions & main unresolved issues?

Section A: Concepts and methods Starts with overview of monetary poverty Remainder of section describes: Unit of measurement Unit of analysis Household definition Population coverage (communal establishments, homeless & Gypsy/Roma) Questions/comments: How does this follow on from Chapter 1? Right level of detail? Any basic concepts missing? To do: Update WB poverty measure to $1.90/day

Section B(i) Welfare Measures Income concept & definitions The income concept Income components (e.g. Income from employment, property income, etc.) Income aggregation Case study: Persons at-risk-of-poverty & beneficiaries of social transfers – different people? (Germany) Data sources for household income Income surveys Income data from registers Pros and cons of income as a welfare measure Questions/comments: Too much detail on income definition? Info available in UNECE Canberra handbook/ OECD ICW framework Is German case study in right place? If not, where? Add something about reference periods? Case study on how poverty rates affected by source (e.g.Nordic countries)

Section B(ii) Welfare Measures Consumption expenditure concept & definitions Data sources for household income Household surveys Retrospective vs. Ongoing collection Pros and cons of consumption expenditure as a welfare measure Using multiple welfare measures Case study: comparing poverty estimates using income, expenditure & mat dep (UK/EU) Questions/comments: More detail on concepts necessary, or right level of detail? Any further case studies on measurement?

Section B(iii) Welfare Measures Key measurement issues Self-employment income Goods/services produced for own consumption Case study: Imputed rent in EU-SILC (EU) Transfers between households Social transfers in kind (STIK) Case study STIK in UK & Finland Questions/comments: Would be good to have a case study for each of the issues covered Any volunteers for self-employment, consumer durables, transfers between households? Results of OECD stocktake on STIK and imputed rent Any other measurement issues to focus on?

Section C (i) Setting a poverty line Absolute vs. Relative lines (intro) Absolute poverty lines Setting lines: cost of basic needs approach Setting lines: subsistence minimum approach Case study: official US measure Case study: Canadian basic needs measure Case study: Establishing an absolute poverty line in Italy Case study: establishing an absolute poverty line in Russia Questions/comments: Cover other variants of approaches (e.g. JRF minimum income standard)? Too many text boxes here? Can we use some of these examples in different ways/ to illustrate different points?

Section C (ii) Setting a poverty line Relative poverty lines Mean vs. Median Case study: mean vs. Median in in EU-SILC Level of threshold Case study: Level of threshold in EU-SILC Anchored poverty lines Equivalence scales & economies of scale Case study: Use of equivalisation in Russian poverty measures Questions/comments: Add Ravallion weakly relative poverty line Expand section on equivalisation: more on different approaches and scales in use Add section on adjusting for price differences over time, across countries, etc. Case study examples where equivalisation is used?

Section D – Poverty indicators Overview Static measures Headcount ratio Poverty gap index Squared poverty gap Case study: Poverty indicators in Russia Other measures (Watts, SST) Dynamic measures Persistent poverty Case study: persistent poverty in UK and EU Entry and exit rates Case study: Poverty entry and exit rates in EU Questions/comments: Other measures to add? Case studies?

Section E – Review of current practices Comparability of poverty estimates MDGs & impact on comparability Eurostat's relative measures & their impact on comparability Poverty measurement in the CIS The effect of social policies on the poor Metadata considerations Tentative recommendations Questions/comments: Anything to add from templates submitted by NSIs? How do we integrate NSI info with that from Eurostat, CISStat, etc. ? What can we conclude about comparability? What steps might be taken to enhance comparability?

Section F – Proposed indicators 'To be developed once initial draft of sections A-E in place'