On the welfarist rationale for relative poverty lines

Martin Ravallion ()

No 4486, Policy Research Working Paper Series from The World Bank

Abstract: The theory and evidence supporting a relativist approach to poverty measurement are critically reviewed. Various sources of welfare interdependence are identified, including the idea of"relative deprivation"as well other (positive and negative) welfare effects for poor people of belonging to a better-off group. An economic model combines informal risk sharing with the idea of a"positional good,"and conditions are derived in which the relative deprivation effect dominates, implying a relative poverty measure. The paper then reviews the problems encountered in testing for welfare effects of relative deprivation and discusses the implications of micro evidence from Malawi. The results are consistent with the emphasis given to absolute level of living in development policy discussions. However, relative deprivation is still evident in the data from this poor but unequal country, and it is likely to become a more important factor as the country develops.

Keywords: Rural Poverty Reduction; Economic Theory&Research; Inequality; Population Policies (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-dev and nep-hap
Date: 2008-01-01
View list of references

Downloads: (external link)
http://www-wds.worldbank.org/servlet/WDSContentSer ... ered/PDF/wps4486.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: http://EconPapers.repec.org/RePEc:wbk:wbrwps:4486

Access Statistics for this paper

More papers in Policy Research Working Paper Series from The World Bank
Address: 1818 H Street, N.W., Washington, DC 20433
Contact information at EDIRC.
Series data maintained by Roula I. Yazigi ().