What makes a man poor?

This op-ed of mine was published in the newspaper "Dhaka Tribune" on January 19, 2016

Recent reports by the Bangladesh government and certain donors show that Bangladesh has made some impressive progress in reducing poverty and extreme poverty. If this trend continues, Bangladesh can be free from extreme poverty within a short period of time.

However, as more people shed the poverty status in Bangladesh, steps should be taken to see if their quality of life has improved as well. Therefore, the government should apply different measures of well-being, ones that reflect whether the lives of the poor have improved.

This calls for updating the current method of measuring poverty. Nobel laureate Amartya Sen said that, to measure poverty, one needs to first identify who is poor, and then use certain mathematical functions to come up with a method of measuring poverty.

Traditionally, the identification of who is poor has been done using a poverty line. It is an income level set by the government, and if someone earns below that line, that person is considered poor. But some poverty experts say that relying solely on income to assess the poverty status of a person may not indicate whether the person is free from other material hardship.

The national poverty line of a person is $1.13 per person per day in Bangladesh (Bangladesh Development Update), which is about Tk90. Thus, a person living in Dhaka and earning Tk100 a day is officially considered to be non-poor, but their housing, transportation, and other expenses may be too high for there to be enough left to spend on food and other activities, and of course, for savings.
This person may not be income poor, but their calorie intake may not be equivalent to that of a non-poor person.

Therefore, in addition to income, other dimensions of well-being such as food, housing, sanitation facilities, education, and health should be measured to see if the employed poverty-alleviation tools have been effective.

Currently, the Bangladesh Bureau of Statistics periodically measures such dimensions of the population in different surveys. All that is needed is to combine the measures of these dimensions to one index, one that can tell us the overall quality of life of the poor.

For example, the multi-dimensional poverty index (MPI), devised by Sabina Alkire and James Foster of George Washington University, aggregates different dimensions of well-being into a single index that can show the overall poverty index of a community.

This measure has been adopted by the UNDP in their Human Development Report, and it is used to measure the extent of the deprivation of multiple dimensions of well-being in a country.
Bangladesh can officially use MPI, besides the current income poverty measure, to measure poverty in the country.

This index is sensitive to improvements in different dimensions of well-being, so, if one or more of the dimensions improve, while others stay the same, it can show that the overall quality of life of the poor has improved.

And if a person improves his housing conditions, while income and other dimensions remain the same, the index would indicate that the person’s quality of life has improved.

This index will properly tell policy-makers how pro-poor policies have been improving the lives of the poor across the country.