Absolute poverty measures for the developing world, 1981-2004

Abstract

We report new estimates of measures of absolute poverty for the developing world for the period 1981-2004. A clear trend decline in the percentage of people who are absolutely poor is evident, although with uneven progress across regions. We find more mixed success in reducing the total number of poor. Indeed, the developing world outside China has seen little or no sustained progress in reducing the number of poor, with rising poverty counts in some regions, notably sub-Saharan Africa. There are encouraging signs of progress in all regions after 2000, although it is too early to say whether this is a new trend. We also summarize results from estimating a new series incorporating an allowance for the higher cost of living facing poor people in urban areas. This reveals a marked urbanization of poverty in the developing world, which is stronger in some regions than others, although it remains that three-quarters of the poor live in rural areas.

Fig. 1.

Evolution of poverty measures over time, 1981–2004. (a) Headcount indices. Note: The series labeled “u+r” incorporates the urban–rural poverty line differential. (b) Number of people below poverty lines. The series labeled “u+r” incorporates the urban–rural poverty line differential.

Fig. 2.

Poverty measures by region 1981–2004. (a) Headcount index. (b) Number of people.