Measurements of Absolute Poverty

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Measurements of Absolute Poverty
Poverty Line: Monthly consumption expenditure used of households to fulfill basic minimum requirements in terms of nutrition, clothing, education, health, etc. It is threshold consumption expenditure.
a. It may be too crude
b. It doesn’t measure the depth of poverty

HeadCount Ratio: No of BPL households/ No of Total households => This ratio tells about the incidence of poverty

Poverty Gap: Simple Average of gaps over the entire population (APL Gap = 0)

Poverty Gap Index: Poverty Gap / Poverty Line

Note that: Same Head Count Ratio but higher Poverty Gap Index => More is the depth of poverty

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