Description: Global Poverty Goals and Prices : How Purchasing Power Parity Matters

Global Poverty Goals and Prices : How Purchasing Power Parity Matters

With the recent release of the 2011 purchasing power parity (PPP) data from the International Comparison Program (ICP), analysts and institutions are confronted with the question of whether and how to use them for global poverty estimation. The pre...

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Bibliographic Details
Main Authors:	Jolliffe, Dean Mitchell, Prydz, Espen Beer
Language:	English en_US
Published:	World Bank, Washington, DC 2015
Subjects:	POVERTY THRESHOLD LIVING STANDARDS PER CAPITA CONSUMPTION HEADCOUNT RATIO GROWTH RATES HOUSEHOLD SURVEY CAPITA INCOME POVERTY LINE ECONOMIC GROWTH SIGNIFICANT EFFECT NATIONAL ACCOUNTS MEAN VALUE INCOME POVERTY ESTIMATES POVERTY RATES NATIONAL POVERTY LINE INTERNATIONAL ORGANIZATIONS GDP PER CAPITA DATA COLLECTION CONSUMPTION DATA DEVELOPING COUNTRIES REDUCED POVERTY PPP GLOBAL LEVEL NATIONAL POVERTY REGIONAL PROFILE POOR PEOPLE RESEARCH GROUP EXTREME POVERTY LINE INTERNATIONAL POVERTY LINES NATIONAL POVERTY RATE DEVELOPMENT GOALS CITIES LOW POVERTY RATES GLOBAL POVERTY INFLATION MEASURES POVERTY MEASURES NATIONAL POVERTY LINES REGION AVERAGE GROWTH RATE POVERTY INDICATOR PUBLIC POLICY DEFINITIONS OF POVERTY MEASURING POVERTY PER CAPITA INCOME CURRENCY DEVELOPMENT ECONOMICS CURRENCY EXCHANGE LOW-INCOME COUNTRIES AVERAGE INCOME DATA QUALITY EXCHANGE RATES COST OF LIVING POPULATION LIVING IN EXTREME POVERTY INTERNATIONAL POVERTY LINE POVERTY STATUS ESTIMATES OF POVERTY INFLATION RATE CONSUMPTION EXPENDITURE HOUSEHOLD SURVEYS INCOME LEVELS RELATIVE PRICES CHANGES IN POVERTY AVERAGE GROWTH POVERTY PROFILE DEVELOPMENT RESEARCH POVERTY LINES CONSUMPTION POVERTY DATA POVERTY INCREASES UNDERSTANDING OF POVERTY COUNTRY LEVEL CUMULATIVE DISTRIBUTION BASIC NEEDS POVERTY MEASUREMENT INCOME DISTRIBUTIONS POOR COUNTRIES DEVELOPING WORLD MEAN INCOME COLLABORATIVE EFFORT INCOME DISTRIBUTION URBAN AREAS ABSOLUTE POVERTY RURAL PRICES RURAL LOCAL CURRENCY POVERTY LEVEL ECONOMICS COMPARATIVE ANALYSIS OF POVERTY WEIGHT ECONOMIC DEVELOPMENT RICH COUNTRIES REGIONS GROWTH RATE COUNTRY–SPECIFIC EXTREME POVERTY POVERTY NATIONAL POVERTY HEADCOUNT CROSS COUNTRY EXTREME POVERTY LINES POPULATION PURCHASING POWER PARITY CONSUMER PRICE INDEX DECLINE IN POVERTY POLICY RESEARCH POVERTY RATE POOR CONSUMPTION PER CAPITA WELFARE MEASURE EXCHANGE RATE DEVELOPMENT INDICATORS POVERTY ANALYSIS DEVELOPMENT POLICY INEQUALITY GROWTH
Online Access:	http://documents.worldbank.org/curated/en/2015/05/24442564/global-poverty-goals-prices-purchasing-power-parity-matters http://hdl.handle.net/10986/21988

Description
Summary:	With the recent release of the 2011 purchasing power parity (PPP) data from the International Comparison Program (ICP), analysts and institutions are confronted with the question of whether and how to use them for global poverty estimation. The previous round of PPP data from 2005 led to a large increase in the estimated number of poor in the world. The 2011 price data suggest that developing countries’ incomes in PPP-adjusted dollars are significantly higher than indicated by the 2005 PPP data. This has created the anticipation that the new PPP data will decrease significantly the count of poor people in the world. This paper presents evidence that if the global poverty line is updated with the 2011 PPP data based on the same set of national poverty lines that define the $1.25 line in 2005 PPPs, and if the 2011 PPP conversion factors are used without adjustments to selected countries, the 2011 poverty rate is within half a percentage point of the current global estimate based on 2005 PPPs. The analysis also indicates that the goal of ‘ending’ extreme poverty by 2030 continues to be an ambitious one.

Global Poverty Goals and Prices : How Purchasing Power Parity Matters

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