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3.2  Poverty Measures

The variations in and are displayed in Figures 9 to 24, which show poverty against (the economies of scale parameter) for four values of (the weight attached to children). Figures 9 to 16 use the individual as the unit of analysis, while Figures 17 to 24 use the child as the unit of analysis, to gauge child poverty. For each poverty measure and unit of analysis, four absolute poverty lines, in terms of equivalent expenditure, are considered, of $150, $165, $180 and $195 per week. Clearly, poverty rises as the absolute poverty line is increased.[19] As with the measures of inequality, poverty also rises as a greater weight is attached to children.

All figures show that poverty strictly rises with .[20] Jointly considering the behaviour of the inequality and poverty measures, it may appear strange that inequality can fall at the same time as poverty rises, which is observed over low values of . However the two measures reflect separate effects on the distribution of equivalent income, , of changes in the scale parameter. Changes in poverty are dominated by shifts in the distribution of equivalent income, while inequality changes are dominated by changes in its dispersion.

Poverty Sensitivity – Unit of Analysis: Individual, Poverty Measure:

Figure 9 -
Figure 10 -
Figure 11 -
Figure 12 -

Notes

  • [19]The use of absolute poverty lines differs from the variable poverty lines used by Coulter et al, who allow the poverty line to depend on equivalent adult size. Consequently their results are not directly comparable with those shown here. 
  • [20]This is a feature of the present data, as the relationship is not necessarily monotonic.
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