REGIONAL POVERTY ANALYSIS TECHNICAL WORKSHOP Objectives of the Workshop: How Can Poverty Analysis Help to Promote Better Policies David Abbott (Regional Macroeconomic and Poverty Reduction Advisor UNDP Pacific Centre) REF: Working Paper 1.1

Background NSOs and Planners have identified need for more information to assist in policy development and monitor performance, including for MDG reporting HIES contain wide range of valuable data not only on income and expenditure but also on housing conditions and household characteristics Developing pro-poor and hardship alleviation policies require better understanding of: The definition of poverty and hardship; what constitutes poverty and hardship in quantifiable terms? Who are the poorest and most disadvantaged in society judged by a defined national poverty benchmark? What are the particular characteristics of those who fall into this category? What policy measures might be initiated to help address the specific problems or sets of disadvantages that are identified?

Objectives Purpose: to discuss and agree on key criteria and methodologies that help to establish these indicators of poverty and hardship

Issues to be Covered 1.2 Valuation of subsistence production and consumption Data Sources and Methods 2.1 Estimating Imputed rents 2.2 Data editing/cleaning 2.3 Use of income or expenditure data Poverty Analysis Considerations 3.1 Adult equivalence scales 3.2 Poverty line diets 3.3 Estimating non-food expenditure and the Basic Needs Poverty Line 3.4 Estimating the incidence of poverty from the BNPL 3.5 Calculation and interpretation of the Poverty Gap Index, Squared Poverty Gap Index, and Gini Coefficients

Main Approaches Defining Poverty;The first three indicators in MDG 1 are: the proportion of the population with an income/consumption less than US$1 (PPP) per capita per day; the Poverty Gap Ratio the share of the poorest quintile in national income/consumption HIES data provides the raw material for estimating these indicators

Key Tools for Poverty Analysis The Food Poverty Line (FPL) The Basic Needs Poverty Line (BNPL) which includes the FPL and a non-food basic needs factor The Head Count Ratio or Index (HCI) which indicates the incidence of poverty within a certain group The Poverty Gap Index (PGI) and Squared Poverty Gap Index (SPGI) which measure the depth and severity of poverty respectively; and The Gini Coefficient, a measurement of inequality

Some Characteristics of Poor Households Derivable from HIES Data Size of households, family structure; Age, sex, marital status of head of household; Location, urban/rural, ethnicity Educational attainment of head of household and household members; Numbers of employees/income earners per household; gender balance; Nature of main income source; formal/informal; Access to “safe” water and “improved” sanitation; Access to “clean” energy sources; Access to computers and internet; Number and gender balance of children in poor households.