A Multidimensional Poverty Index for Latin America

Authors

  • Maria Emma Santos,

    Corresponding author
    1. Instituto de Investigaciones Económicas y Sociales del Sur (IIES), Bahía Blanca, Argentina and Comision Economica para America Latina y el Caribe (CEPAL), Santiago, Chile
    • Corresponding to: Instituto de Investigaciones Económicas y Sociales del Sur (IIES), Departamento de Economía, Universidad Nacional del Sur (UNS) – Consejo Nacional de Investigaciones Científicas y Técnicas (CONICET), San Andrés 800, 8000 Bahía Blanca, Argentinal Oxford Poverty and Human Development Initiative, University of Oxford (msantos@uns.edu.ar; maria.santos@qeh.ox.ac.uk).

    Search for more papers by this author
  • Pablo Villatoro

    1. Instituto de Investigaciones Económicas y Sociales del Sur (IIES), Bahía Blanca, Argentina and Comision Economica para America Latina y el Caribe (CEPAL), Santiago, Chile
    Search for more papers by this author

  • Note: We are deeply grateful to Xavier Mancero and Pascual Gerstenfeld for insightful comments and suggestions throughout this research. We are also grateful to Sabina Alkire for comments and suggestions upon completion of a first draft, to Roberto Angulo Salazar and Natalie Gomez for valuable input at the beginning of this project, and to two anonymous referees for suggested changes and revisions that improved the paper. We would particularly like to acknowledge the use of the Advanced Research Computing (ARC) for intensive computations. Maria Emma Santos would like to thank ANPCyT-PICT 2015-2079 and CONICET-PIP 11220150100659CO01 for research support.

Abstract

This paper proposes a new Multidimensional Poverty Index for Latin America. The index combines monetary and non-monetary indicators, updates deprivation cut-offs for certain traditional unsatisfied basic needs indicators and includes some new indicators, aiming to maximize regional comparability within the data constraints. The index is estimated for 17 countries of the region at two points in time—one around 2005 and the other around 2012. Overall, we estimate about 28 percent of people are multidimensionally poor in 2012 in the region. We find statistically significant reductions of poverty in most countries, both in terms of incidence and intensity over the period under analysis. However, important disparities between rural and urban areas remain. Statistical scrutiny of the index suggests that it captures the state of poverty relatively well while maintaining a certain parsimony and being highly robust to changes in weights, indicators, and poverty cut-off.

Ancillary