Is Poverty Comparable Across Varying Size of Population Among Indian States?

Abstract

The most popular measure of poverty, ie the head count ratio is undoubtedly a simple measure with inadequacies of comparison. It also suffers from the mismatched contradiction between the count of the poor and their share in the population. Such inadequacies point towards the limitation in comparing poverty head count ratio across varying population sizes. The comparison of this measure between not only varying population sizes but also varying shares of the poor and the non-poor is worth contemplating in case it derives upon the ill-fare of poverty. Given these concerns, the measure of poverty accounting for its absolute count, intensity as well as inequality is proposed here as a modified version of the Sen, Shorrocks and Thorn (SST) measure of poverty. Further, a decomposition exercise is carried out to comprehend the share of each of its components in the changing level of poverty which is illustrated using the Indian data set. The salient observation made here relates to declining poverty levels in Indian states being in disagreement with reduced ill-fare as the poverty gap is on a rise along with the count of the poor. This raises apprehensions as to whether poverty reduction has to less to the do with the changing state of the poor rather than the changing state of the non-poor.