Poverty Measurement in the U.S., Europe, and Developing Countries

In December of 2009, many within the American community of analysts, policymakers, and program managers are looking expectantly at the possibility of change in the basic measure used to gauge poverty in the United States. A broad consensus has emerged that the current official measure of poverty in the United States is deeply flawed, in the income threshold used to gauge need as well as in the measurement of available resources. While there will be opposition to this change, primarily due to concerns centering around the relationship of the poverty measure to funding of block grants and benefit eligibility within programs, there does seem to be good reason to believe that the time has arrived for a new poverty measure for the United States. Because the poverty measure has been used to determine both individual program eligibility and flows of money within block grants to states, attempts to alter the official measure attract the attention of advocates for those who might be impacted if a revised measure is produced. Thus, the proposal contained within the Measuring American Poverty Act of 2009, H.R. 2909, or the MAP Act is a reasonable way forward: Produce the National Academy of Sciences (NAS) measure while retaining the existing one for purposes of program administration. In this article, the authors talk about poverty measurement in the U.S., Europe, and developing countries. As America moves in the direction of a quasi-relative poverty measure, American people can learn from the European experience that reductions in relative poverty come harder than against an absolute standard. The authors share lessons that might be learned from listening to the discourse among Europeans regarding their own social policy. They also cite Anirudh Krishna's (2010) Stages of Progress methodology for measuring poverty. (Contains 12 footnotes.)