Question

what is the International poverty line as described by the World bank? differentiate between absolute poverty and relation poverty.

Answer 1

The first requirement led researchers to anchor the international poverty line on the national poverty lines of very poor developing countries. And the second requirement led them to use purchasing power parity exchange rates (PPPs) – rather than nominal ones - to convert the line into the US dollar and, more importantly, into the currencies of each developing country.

World Bank researchers have been trying to assess the extent of extreme poverty across the world since 1979 and more systematically since the World Development Report 1990, which introduced the dollar-a-day international poverty line. From the beginning, the idea was to measure income poverty with respect to a demanding line which, first, reflects the standards of absolute poverty in the world’s poorest countries and, second, corresponded to the same real level of well-being in all countries. The first requirement led researchers to anchor the international poverty line on the national poverty lines of very poor developing countries.

Absolute Poverty:

Long back, Seebhom Rowntree, a pioneer of poverty studies, defined absolute poverty as the condition under which one cannot afford ‘the minimum provision needed to maintain health and working efficiency’. He decided his ‘poverty line’ on the basis of nutrition a person gets from his/her diet.
Families whose income fell below this poverty line were in absolute poverty. The definition of absolute poverty is based on a fixed level, usually known as ‘poverty line’. It is the line below which poverty begins and above which it ends.

Relative Poverty:
In view of the problems of measurement of the notions of physical and/or cultural needs, many scholars have abandoned the concept of absolute poverty and in its place they have developed the idea of relative standards, i.e., standards which are relative to the particular place and time