Like development, poverty is multidimensional — but this is traditionally ignored by headline figures. The Multidimensional Poverty Index (MPI), published for the first time in the 2010 Report, complements money-based measures by considering multiple deprivations and their overlap. The index identifies deprivations across the same three dimensions as the HDI and shows the number of people who are multidimensionally poor (suffering deprivations in 33% of weighted indicators) and the number of deprivations with which poor households typically contend. It can be deconstructed by region, ethnicity and other groupings as well as by dimension, making it an apt tool for policymakers.
About 1.7 billion people in the 109 countries covered by the MPI—a third of their population — live in multidimensional poverty — that is, with at least 33 percent of the indicators reflecting acute deprivation in health, education and standard of living. This exceeds the estimated 1.3 billion people in those countries who live on $1.25 a day or less (though it is below the share who live on $2 or less).
The Multidimensional Poverty Index (MPI) identifies multiple deprivations at the individual level in health, education and standard of living. It uses micro data from household surveys, and—unlike the Inequality-adjusted Human Development Index—all the indicators needed to construct the measure must come from the same survey. Each person in a given household is classified as poor or non-poor depending on the number of deprivations his or her household experiences. This data are then aggregated into the national measure of poverty.
The MPI reflects both the prevalence of multidimensional deprivation, and its intensity—how many deprivations people experience at the same time. It can be used to create a comprehensive picture of people living in poverty, and permits comparisons both across countries, regions and the world and within countries by ethnic group, urban or rural location, as well as other key household and community characteristics. The MPI builds on recent advances in theory and data to present the first global measure of its kind, and offers a valuable complement to income-based poverty measures. The 2013 Human Development Report (HDR) presents estimates for 104 countries with a combined population of 5.4 billion (76% of the world total). About 1.6 billion people in the countries covered—30% of their entire population—lived in multidimensional poverty between 2002 and 2011.
The MPI identifies overlapping deprivations at the household level across the same three dimensions as the Human Development Index (living standards, health, and education) and shows the average number of poor people and deprivations with which poor households contend. For details see Alkire and Santos (2010).
The MPI replaced the HPI, which was published from 1997 to 2009. Pioneering in its day, the HPI used country averages to reflect aggregate deprivations in health, education, and standard of living. It could not identify specific individuals, households or larger groups of people as jointly deprived. The MPI addresses this shortcoming by capturing how many people experience overlapping deprivations (prevalence) and how many deprivations they face on average (intensity). The MPI can be broken down by indicator to show how the composition of multidimensional poverty changes for different regions, ethnic groups and so on—with useful implications for policy.
One deprivation alone may not represent poverty. The MPI requires a household to be deprived in multiple indicators at the same time. A person is multidimensionally poor if the weighted indicators in which he or she is deprived add up to at least 33%.
We could not include income due to data constraints. Income poverty data come from different surveys, and these surveys often do not have information on health and nutrition. For most countries we are not able to identify whether the same people are income poor and also deprived in all the MPI indicators so could not include income.
The MPI relies on three main databases that are publicly available and comparable for most developing countries: the Demographic and Health Survey (DHS), the Multiple Indicators Cluster Survey (MICS), and the World Health Survey (WHS). [See list of surveys included for the 2012 Estimation]
We could not include other countries due to data constraints. Comparable data on each of the indicators were not available for other developing nations. There was also a deliberate effort not to use data from surveys conducted earlier than 2002.
The MPI relies on the most recent and reliable data available since 2002. The difference in dates limits direct cross-country comparisons, as circumstances may have improved, or deteriorated, in the intervening years. This is the reason why we do not rank countries based on MPI value. This year we have grouped countries into two categories—those with estimates based in surveys conducted between 2007 and 2011 in one group and those 2002 to 2006 in another.
No. The MPI is intended to complement monetary measures of poverty, including $1.25 per day estimates. The relationship between these measures, as well as their policy implications and methodological improvement, are priorities for further research.
The MPI methodology shows aspects in which the poor are deprived and help to reveal the interconnections among those deprivations. This enables policymakers to target resources and design policies more effectively. This is especially useful where the MPI reveals areas or groups characterized by severe deprivation. Examples where this has been done in practice include Mexico’s poverty-reduction program, as described in the 2011 Human Development Report.
The MPI constitutes a family or set of poverty measures. These measures can be unpacked to show the composition of poverty both across countries, regions and the world and within countries by ethnic group, urban/rural location, as well as other key household and community characteristics. This is why OPHI describes the MPI as a high resolution lens on poverty: it can be used as an analytical tool to identify the most prevailing deprivations. The MPI measures are explained below:
Incidence of poverty: the proportion of people who are poor according to the MPI (those who are deprived in at least 33.3% of the weighted indicators).
Average intensity of poverty: the average number of deprivations people experience at the same time.
MPI value: The MPI value summarizes information on multiple deprivations into a single number. It is calculated by multiplying the incidence of poverty by the average intensity of poverty.
The MPI indicators are drawn from the MDGs as far as the available internationally comparable data allow. The 10 indicators of the MPI are identical, or relate, to MDG indicators: nutrition (MDG 1), child mortality (MDG 4), access to drinking water (MDG 7), access to sanitation facility (MDG 7) and use of an improved source of cooking fuel (MDG 9). The overall MPI can be broken down into its constituent parts, revealing the overlapping needs of families and communities across a range of indicators which so often have been presented in isolation. This helps policymakers to see where challenges lie and what needs to be addressed.
The effects of shocks are difficult to capture in any poverty measure. Because the standard survey data used to estimate the global measure are collected infrequently, the ability to detect changes is limited by the available data fed. The MPI will reflect the impacts of shocks as far as these cause children to leave primary education or to become malnourished, for example. If more frequent data are available at the country or local level, this can be used to seek to capture the effects of larger scale economic and other shocks.
The MPI is one of three new experimental series introduced in 2010, alongside the Inequality-adjusted Human Development Index and the Gender Inequality Index. It will evolve over time just like the other human development indices.