Being poor can mean going hungry, or it can mean having far less than everyone around you.
Two kinds of poverty
Absolute poverty
Too little income to meet basic needs: food, clean water, shelter.
Relative poverty
Too little compared with others in the same country.
Corland: median income €2,000, so the relative poverty line (60%) is €1,200
| Household | Monthly income | Relatively poor? | Absolutely poor? |
|---|---|---|---|
| Ana | €1,800 | No | No |
| Ben | €1,000 | Yes: below €1,200 | No: basic needs met |
| Cara | €250 | Yes | Yes: cannot pay for food and rent |
Write it like this in the exam
- Absolute poverty: "an income below the level needed to meet basic needs such as food, clothing and shelter."
- Relative poverty: "an income below a poverty line set as a percentage of median income, too low for the typical standard of living in the country."
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Some measures use one number; others combine several.
How poverty is measured
International poverty line
The World Bank's line: $3.00 a day since 2025 (it was $2.15).
Minimum income standard
What the public agree a household needs for a decent life.
Multidimensional Poverty Index
Ten signs of deprivation in health, education and living standards.
The MPI: poor if deprived in at least a third of the weighted indicators
| Dimension | What is checked |
|---|---|
| Health | Nutrition, child deaths |
| Education | Years of schooling, school attendance |
| Living standards | Cooking fuel, toilets, drinking water, electricity, housing, assets |
Remember it as: Single: one income line. Composite: many signs of deprivation.
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Counting the poor sounds simple. It is not.
Why poverty is hard to measure
Which kind?
Absolute and relative measures can tell different stories.
Where is the line?
Just above it counts as not poor; it hides how far below people are.
Income is not everything
Income misses wealth, health, schooling and clean water.
Hard-to-get data
Surveys miss informal income and homeless people.
Prices differ
The same income buys more in some places than others.
The points to remember
- A household on $2.90 a day and one on $1.00 count the same: both are below the line.
- Relative poverty can rise while everyone's income grows, if the median grows faster.
Paper 1 asked this in May 2023, as part (a) for 10 marks.
Explain the difficulties involved in measuring poverty.
Model answer plan
See the answer broken into clear points, with guidance on how each point earns marks.
How the 10 marks are given
| Marks | What your answer needs |
|---|---|
| 9–10 | Theory fully explained, terms used correctly all the way through, the diagram included and fully explained |
| 7–8 | Theory explained, terms mostly right, the diagram included and explained |
| 5–6 | Theory partly explained, some terms, the diagram included |
| 1–4 | Theory only described or stated; few relevant terms |