Global "dollar-a-day" poverty line revised from USD 1.08 to USD 1.25
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A new working paper by Martin Ravallion, Shaohua Chen and Prem Sangraula presents the first major update of the international "USD 1 a day" poverty line, first proposed in 1990 for measuring absolute poverty by the standards of the world's poorest countries. The current estimates of poverty use an international poverty line of USD 1.08 a day at 1993 purchasing power parities (PPP). Using 2005 PPPs recently published by the International Comparison Program and a new database of national poverty lines, the authors find that a marked economic gradient emerges only when consumption per person is above about USD 2.00 a day at 2005 PPPs. Below this, the average poverty line is USD 1.25, which is now proposed as the new international poverty line. In future work, both absolute and relative poverty lines will be applied to a data set of over 500 household surveys across 100 countries to estimate new aggregate poverty measures for the developing world and its main regions. The new series of poverty measures, expected in August 2008, will span 1981-2005 at three yearly intervals.
Policy research working paper
("http://econ.worldbank.org/external/default/main?pagePK=64165259&theSitePK=469372&piPK=64165421&menuPK=64166093&entityID=000158349_20080519155817&cid=decresearch")
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