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469. Multidimensional Poverty Index in Rural Areas

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The global Multidimensional Poverty Index (MPI) was first designed by the University of Oxford and the United Nations Development Programme (UNDP) in 2010 to complement traditional money-based poverty indicators by capturing the rapid deterioration of health, education and living standards.

On the other hand, the world's poor are concentrated in rural areas, and there are differences in the quality of urban and rural poverty that cannot be captured by common indicators. Each rural area in the world has its own unique environment due to the historical background of not only the natural ecological conditions but also the physical and human-made landscapes. At the same time, many of the rural poor are family-run subsistence farmers, fishermen, pastoralists etc. who have been marginalized socially and physically because they lack sufficient productive means and access to natural resource-based assets. These people are exposed not only to economic shocks, but also to the risks of climate change.

In January 2022, the Food and Agriculture Organization of the United Nations (FAO) and the Oxford Poverty and Human Development Initiative (OPHI) released a joint report, Measuring Rural Poverty with a Multidimensional Approach - The Rural Multidimensional Poverty Index (R-MPI). The report was designed as a modification of the Global MPI and was based on five dimensions, namely,  food security and nutrition, education, living standards, livelihoods and resources, and exposure to risks. The conceptual framework and indicators were developed to capture the multiple dimensions of poverty in rural areas. In addition, the report empirically uses the indicators to analyze household data from Malawi, Ethiopia, Niger, and Nigeria, and makes policy recommendations for those working to eradicate poverty in rural areas.

Referring to methodological studies of poverty measurement in developing countries, the report also discusses the challenges of indexing multidimensional poverty, which has different implications for different regional contests. For example, not owning livestock assets in a certain region may be a circumstance of that society (fishing community), or not owning land assets may be a result of voluntary choice of the household (engaging in non-agricultural activities), which does not necessarily mean a state of deprivation. Thus, while the index allows for inter-regional comparisons, it also needs to be used with an understanding of its limitations in capturing poverty in rural contexts.

The R-MPI also incorporates access to technical assistance, such as extension services, as a component of rural livelihoods and resources. For risk, consideration is given to access to finance, risk tolerance, and the degree of exposure to climate change risk.

Reference

FAO and OPHI (2022). Measuring Rural Poverty with a Multidimensional Approach: The Rural Multidimensional Poverty Index. FAO Statistical Development Series, No. 19. Food and Agriculture Organization of the United Nations (FAO) and Oxford Poverty and Human Development Initiative (OPHI). https://www.fao.org/documents/card/en/c/cb8269en 

Contributor: IIYAMA Miyuki (Director, Information Program)