Thursday, February 21, 2008

The art of constructing an official poverty line

In his budget speech Mr Trevor Manual referred to South Africa's new official poverty line, expected witin a few weeks from Statistics South Africa. A bit of deja vu - in last year's budget speech it was noted that an official poverty line was expected in the second half of 2007 (M&G).

While we wait, a few snippets on poverty and poverty lines:
  • The poverty threshold, or poverty line, is the minimum level of income deemed necessary to achieve an adequate standard of living. (Wikipedia)
  • Zimbabwe's poverty line is a staggering Z$100 million per month!! (Fin24)
  • China's official poverty line is reported to be Yuan 640 ($85) per capita per year, a figure far too low for subsistence and much lower then the international bencmark of $1 per capita per day (Share The World's Resources)
  • There is very little consensus on how to define poverty let alone measure it (eldis)
  • The following map from UNDP (Data source: United Nations Human Development Report 2007-2008. Available at indicates percentage of people living on less then $1 per day:

Poverty is a politically sensitive. Measurement is an open game. As in the case of China all the incentives are there to manipulate the outcome. One can only hope that the much anticipated South African official poverty line does not not fall prey to such shortsightedness.

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