Approaches to using MICS for Equity/Poverty Analysis Multiple Indicator Cluster Surveys Data Dissemination - Further Analysis Workshop Approaches to using MICS for Equity/Poverty Analysis MICS4 Data Dissemination and Further Analysis Workshop

Multidimensional Poverty Indices Outline Consumption/income poverty Wealth Index Bristol Child Deprivation Index Multidimensional Poverty Index (MPI) New Development (MODA, CDS) Critics

Multidimensional Poverty Indices -Background Once upon a time… ….INCOME/CONSUMPTION POVERTY Three main decisions: 1. How do we assess individual well-being or "welfare"? Income or consumption 2. At what level of measured well-being do we say that a person is not poor? Choose poverty lines 3. How do we aggregate individual indicators of well-being into a measure of poverty? FGT poverty measures

Multidimensional Poverty Indices - Background UN General Assembly Definition of Child Poverty, 10th January 2007 “Children living in poverty are deprived of nutrition, water and sanitation facilities, access to basic health care services, shelter, education, participation and protection, and that while a severe lack of goods and services hurts every human being, it is most threatening and harmful to children, leaving them unable to enjoy their rights, to reach their full potential and to participate as full members of the society”

Multidimensional Poverty Indices WEALTH INDEX Use information on assets or household possessions It takes a large number of assets that may not tell us much individually, but are correlated since they are all related to an underlying factor – in this case, “wealth” Generate weights (factor scores) for each of the assets through principal components analysis Weights summed by household, household members ranked according to the total score of the household in which they reside Divide the households into quintiles

Multidimensional Poverty Indices WEALTH INDEX Number of persons per sleeping room Material of dwelling floor Material of the roof Material of the walls Fuel used for cooking Electricity Radio Television Mobile telephone Non-mobile telephone Refrigerator Watch Bicycle Motorcycle/scooter Animal-drawn cart Car/truck Boat Source of drinking water Type of sanitation facility Ownership of animals Ownership of land Furniture Additional household items

Multidimensional Poverty Indices WEALTH INDEX Long-term wealth versus current economic status Adjustment for household size? How to deal with public services? Does the asset index reflect community variables (especially locally available infrastructure such as electricity for lighting or piped water) rather than household specific variables? Urban bias Strength of the index when comparing it over time and across countries

Multidimensional Poverty Indices BRISTOL POVERTY MEASURE Developed by Bristol University - Townsend Centre for International Poverty Research with UNICEF UNICEF's State of the World's Children report 2005 UNICEF launched at the end of 2007 the Global Study on Child Poverty and Disparities that combines the income approach with the Bristol deprivations approach (see http://www.unicefglobalstudy.blogspot.com/) As of June 2011, 52 UNICEF Country Offices in seven regions have joined the study. A total of 23 country reports have been produced

Multidimensional Poverty Indices Indicator Shelter More than 5 members per room, or no floor material Sanitation No toilet facility of any kind Water Use of surface water or source more than 30 min away Information No access to radio, television, telephone or newspapers at home Nutrition Severe stunting, wasting or underweight Education Children (7-17) never been to school Health No immunization or no treatment of ARI or diarrhoea

Multidimensional Poverty Indices Children experiencing TWO OR MORE severe deprivations are absolute poor Children experiencing ONE OR MORE severe deprivations are severely deprived 34% of children in the developing world (around 650 million) live in absolute poverty 56% of children in the developing world (over one billion) experience severe deprivation of at least one basic human need

Multidimensional Poverty Indices

Multidimensional Poverty Indices Multidimensional Poverty Index (MPI) Developed by Oxford Poverty & Human Development Initiative (Sabina Alkire and James Foster 2007, 2009) 2010 United Nations Development Programme Human Development Report (104 countries)

Multidimensional Poverty Indices - MPI

Multidimensional Poverty Indices Domain Indicator Health Any child dead Any adult or child malnourished Education No household member completed 5 years Any child out of school Standard of No electricity Living Unimproved water or clean water more than 30 mins distant Unimproved or shared sanitation Dirt, sand, dung floor Wood, charcoal, dung used as cooking fuel Not owning more than one of: radio, TV, phone, bike, motorbike or a car/truck

Multidimensional Poverty Indices Each dimension is equally weighted: Health = 1/3 Education = 1/3 Standard of Living = 1/3 The MPI combines two aspects of poverty: MPI = H x A Incidence (H) = the percentage of people who are poor, or the headcount Intensity (A) of people’s poverty = the average percentage dimensions in which poor people are deprived

MICS4 Regional Workshop Indicators 1 2 3 4 Weight Household size 7 5 HEALTH At least one member malnourished 1.67 One or more children have died EDUCATION No one has completed five years of schooling At least one school-age child not enrolled LIVING CONDITIONS No electricity 0.56 No access to clean drinking water No access to adeguate sanitation House has dirt floor Household uses “dirty” cooking fuel Household has no car and owns at most one of: bicycle, motorcycle, radio, refrigerator, telephone or television RESULTS Weighted count of deprivation, c 2.22 7.22 3.89 5.00 Is the household poor? c>3 NO YES MICS4 Regional Workshop

Multidimensional Poverty Indices Weighted count of deprivation in household 1: Headcount ratio= (80 percent of people live in poor households) Intensity of poverty= (the average poor person is deprived in 56 percent of the weighted indicators) MPI= H × A = 0.45

Multidimensional Poverty Indices Results: 1.7 billion people, 32% of the total population in 104 countries, are identified as multi-dimensionally poor. 51% live in South Asia and 28% in sub-Saharan Africa MICS4 Regional Workshop

MICS4 Regional Workshop Countries with the highest incidence of poverty tend to have the highest intensity of poverty. MICS4 Regional Workshop

Multidimensional Poverty Indices Deprivation in living standards (the green portion) often contributes more than deprivation in either of the other two dimensions. In most countries, the second biggest contribution comes from educational deprivations.

Multidimensional Poverty Indices MPI and Income Poverty are related PEARSON CORR. $ 1.25/day–MPI = 0.85 More persons are MPI poor than income poor

Multidimensional Poverty Indices MPI at the regional level

Multidimensional Poverty Indices New development… Multiple Overlapping Deprivation Analysis (MODA) (IRC/Unicef) CHILD DEPRIVATION SCORE (UNICEF)

Multidimensional Poverty Indices CRITICS (Ravallion 2011) Indicators likely to be correlated with consumption or income, but they would not capture well the impacts on poor people of economic downturns or quick economic shocks. As data is to be collected from the same survey, the precise indicators used in the MPI are somehow data driven… Indices adding up “apples and oranges” … …how can one contend that the death of a child is equivalent to having a dirt floor, cooking with wood, and not having a radio, TV, telephone, bike or car?  Or that attaining these material conditions is equivalent to an extra year of schooling or to not having any malnourished family member? Isn’t “multi-dimensional” about recognizing that there are important aspects of welfare that cannot be captured in a single index? MULTIDIMENSIONAL INDICES TO COMPLEMENT TRADITIONAL ANALYSIS

References Alkire, S. and Foster, J. 2007 and 2009. Counting and Multidimensional Poverty Measurement. OPHI Working Paper 7 and 32. Alkire, S. and Santos, M.E. 2010. Acute Multidimensional Poverty: A New Index for Developing Countries. OPHI Working Paper 38. Gordon, David, et al., Child poverty in the developing world, The Policy Press, Bristol, UK, October 2003. Ravallion, Martin, On Multidimensional Indices of Poverty (February 1, 2011). World Bank Policy Research Working Paper Series, Vol. , pp. -, 2011. Rutstein, Shea O. and Kiersten Johnson. 2004. The DHS Wealth Index. DHS Comparative Reports No. 6. Calverton, Maryland: ORC Macro. Rutstein, Shea O. 2008 The DHS Wealth Index: Approaches for Rural and Urban Areas Sahn, David E. and David Stifel. 2000. “Poverty Comparisons over Time and Across Countries in Africa.” World Development 28(12):2123-2155

Some examples

Some examples

MICS4 Regional Workshop Some examples MICS4 Regional Workshop

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