Measuring Poverty

Leland Joseph R. Dela CruzDevelopment Studies Program

Ateneo de Manila UniversityAlternative Class Program

January 22, 2010

Alternative questions for measuring poverty How much income do you make? How much income do you make

relative to what others make? Do you consider yourself poor? Do you have access to basic

needs? What is the quality of life you are

able to lead?

Poverty as Lack of Income

How much income do you make?

Test your knowledge!1. How much should a family of 5

persons be earning per month to be considered non-poor?

2. What percent of the Philippine population is considered poor?

When is a person considered poor? A poor person is someone who

earns income below the official poverty line or poverty threshold.

The poverty line measures the income needed to obtain basic and non-basic needs for one year.

How does the government compute for the poverty line?1. The government constructs a menu

per region that satisfies basic nutritional requirements. The government computes for the cost of that menu. (ex. P43)

2. The government computes for the proportion of income that is budgeted for food using survey data. (ex. 66%)

3. The figure obtained in #1 is divided by the figure obtained in #2. (ex. P43 / 66% = P65)

What is the NCR poverty line (2008)? NSCB

P328.77Family/ day*

P10,000.00Family/ month

P120,000.00Family/ year*

P65.76Individual/ day*

P2,000.00Individual/ month*

P24,000.00Individual/ year*

*Unofficial, self-computed

What is the Philippine poverty line (2006)? NSCB

P206.29Family/ day*

P6,273.99Family/ month*

P75,287.85Family/ year*

P41.26Individual/ day*

P1,254.80Individual/ month*

P15,057.57Individual/ year NSCB

*Unofficial, self-computed

Poverty incidence 2006, NSCB

32.9% or 27.6 million Filipinos are poor. 32.9% of Filipinos earn less than P15,057.57

a year (Y36,557), P1,254.80 a month (Y3,046) and P41.26 a day (Y100.15).

26.9% or 4.6 million Filipino families are poor. 26.9% of families earn less than P75,287.85

a year (Y182,705), P6,273.99 a month (Y15,232.08) and P206.29 a day (Y500.78).

Poorest Provinces (2006) NSCB

Poverty Incidence

Tawi-Tawi, Mindanao 78.9%

Zamboanga del Norte, Mindanao

63.0%

Maguindanao, Mindanao 62.0%

Apayao, Northern Luzon 57.5%

Surigao del Norte, Mindanao 53.2%

Lanao del Sur, Mindanao 52.5%

Northern Samar, Visayas 52.2%

Masbate, Southern Luzon 51.0%

Abra, Northern Luzon 50.1%

Misamis Occidental, Mindanao

48.8%

Least Poor Provinces (2006) NSCB

Poverty Incidence

Batanes, Northern Luzon 0%

Rizal, Adjacent to NCR 6.4%

Bataan, Luzon 6.8%

Cavite, Adjacent to NCR 7.8%

Benguet, Luzon 8.2%

Pampanga, Adjacent to NCR 8.3%

Bulacan, Adjacent to NCR 10.0%

Laguna, Adjacent to NCR 10.6%

Nueva Vizcaya, Luzon 12.7%

Quirino, Luzon 15.9%

Poverty trends NSCB

0

5

10

15

20

25

30

35

Families Individuals

200020032006

Philippine Poverty Incidence: Families (Percentage) NSCB

0

5

10

15

20

25

30

35

40

45

1988 1991 1994 1997 2000 2003

%

Philippine Poverty Incidence: Individuals (Percentage) NSCB

0

10

20

30

40

50

60

1988 1991 1994 1997 2000 2003

%

Philippine GNP Growth Rate (%)

0

1

2

3

4

5

6

7

8

2001 2002 2003 2004 2005 2006 2007 2008

NEDA Economic Indicators Online

Relative Poverty

How much income do you make relative to what others

make?

Income Distribution 2006, NSO

1.9 3 3.8 4.7 5.87.1 9

11.816.8

36

0

5

10

15

20

25

30

35

40

% o

f In

com

e

1st 3rd 5th 7th 9th

Decile

Average family income, expenditures and savings per decile 2006, NSO

Avg. Annual Income

Avg. Expenditures

Avg. Savings

Avg. Monthly Income

Phil 173,000 147,000 25,000 14,416

Poorest 10%

32,000 35,000 -3,000 2,666

2nd decile 51,000 52,000 -2,000 4,250

3rd decile 65,000 66,000 Less than 500

5,417

4th decile 81,000 79,000 2,000 6,750

5th decile 100,000 95,000 5,000 8,333

6th decile 124,000 116,000 7,000 10,333

7th decile 156,000 143,000 13,000 13,000

8th decile 205,000 181,000 23,000 17,083

9th decile 292,000 244,000 46,000 24,333

Richest 10%

622,000 460,000 156,000 51,833

Income Distribution

0

510

1520

25

3035

40

% o

f In

com

e

1st to 7th 8th 9th 10th

Decile

Income Distribution

0

10

20

30

40

50

60

% o

f In

com

e

1st to 8th 9th to 10th

Decile

Self-Rated Poverty

Do you consider yourself poor?

Self-Rated Poverty SWS

Self-Rated Poverty Pulse-Asia

June 2004

October2004

March 2005

Philippines

70% 70% 70%

Class ABC

37% 21% 35%

Class D 68% 68% 69%

Class E 84% 87% 82%

Self-Rated Poverty Pulse-Asia

June 2004

October2004

March 2005

NCR 52% 41% 48%

Luzon 69% 69% 66%

Visayas 71% 82% 80%

Mindanao 80% 79% 81%

Rural 73% 83% 82%

Urban 66% 57% 58%

SummaryOfficial Statistics

Perception-based measure

Poverty Incidence

25% 50-70%

Poverty threshold

P6,273.99 a month

P10,000 a month

Basic Needs Deprivation

Do you have access to basic needs?

Self-Rated Hunger SWS

Access to basic needs NSCB

Indicator % of population

With access to safe drinking water

80.2%

With sanitary toilet 86.2%

With access to electricity 79.7%

With own house and lot 64.9%

With children 6-12 years old in elementary

91.2%

With children 13-16 years old in high school

36.1%

Inadequacies at the Elementary Level

Source: Basic Education Information System, DepEd

SEATS NEEDED PUPILS PER TEACHER RATIO

CLASSROOMS NEEDED TO ACHIEVE 40 STUDENTS

PER CLASS RATIO Quezon City 101,317 Antipolo City 61.86 Quezon City 3,377 Kalookan 82,413 San Jose del Monte 60.00 Kalookan 2,244 Lanao del Sur 1 73,472 Las Pinas 53.74 Rizal 1,533 Manila 73,180 Maguindanao 52.92 Cavite 1,434 Maguindanao 69,934 Bayawan City 51.31 Manila 1,422 Camarines Sur 64,688 Muntinlupa 50.93 Antipolo City 1,193 Iloilo 57,128 Talisay City 50.17 Mal/Navotas 1,078 Davao City 53,885 Kalookan 49.30 Taguig/Pateros 996 Cavite 53,101 Rizal 47.87 Las Pinas 882 Bukidnon 48,771 Lapu-Lapu City 47.33 Maguindanao 808

SEATS NEEDED PUPILS PER TEACHER RATIO

CLASSROOMS NEEDED TO ACHIEVE 40 STUDENDS

PER CLASS RATIO Quezon City 62,749 Bayawan City 79.60 Quezon City 1,660 Iloilo 46,812 Antipolo City 77.58 Cavite 1,570 Rizal 43,305 Talisay City 77.05 Bulacan 1,107 Davao City 41,018 Danao City 76.07 Kalookan 1,093 Cavite 40,064 Lanao del Sur 1 72.34 Rizal 1,071 Cebu 39,877 Marawi 65.08 Laguna 1,043 Quezon 37,973 Lanao del Sur 2 61.56 Cebu 1,003 Manila 34,488 Sn Jose del Monte 59.32 Davao 997 Bulacan 34,160 Tanjay City 59.32 Pampanga 706 Camarines Sur 33,405 Cagayan de Oro 55.13 Quezon 697

Inadequacies at theSecondary Level

Source: Basic Education Information System, DepEd

Health Personnel by Location

Rural Urban

Midwives ~30% ~60%

Nurses ~20% ~80%

Dentists ~10% ~90%

Doctors62% migrate to other countries

~10% ~90%

Source: Dr. Merceditas Santos-Tuano, former Executive Director, Healthdev Institute

Child Delivery Attendants (2003, NDHS)

0

10

20

30

40

50

60

Doctor Nurse Midwife Hilot Others

UrbanRuralPhil.

Child Delivery Attendants by Income Quintiles (2003,

NDHS)

0

10

20

30

40

50

60

70

80

Doctor Nurse Midwife Hilot Others

LowestSecondThirdFourthFifth

Location of Child Delivery (2003, NDHS)

0

10

20

30

40

50

60

70

80

Govt Hospital Private Hospital Home

UrbanRuralPhil.

Location of Child Delivery by Income Quintile (2003, NDHS)

0

10

20

30

40

50

60

70

80

90

Govt Hospital Private Hospital Home

LowestSecondThirdFourthFifth

Quality of Life Deprivation

What is the quality of life you are able to lead?

National Achievement Test Scores Elementary Average: 59.94% High School Average: 46.64%

Source: Basic Education Information System, DepEd

Third International Math and Science Survey Grade 4 Test: Philippines ranked 3rd

lowest among 25 countries (Japan ranked 3rd highest behind Singapore and Hong Kong)

Grade 8 Test: Philippines ranked 6th lowest among 45 countries (Japan ranked 5th highest behind Singapore, Korea, Hong Kong and Taiwan)

Female Life Expectancy2000, PSY

50 60 70 80 90

China

Hong Kong

Korea

Singapore

Taiwan

Indonesia

Malaysia

Philippines

Thailand

Vietnam

Bangladesh

Male Life Expectancy2000, PSY

50 55 60 65 70 75 80

China

Hong Kong

Korea

Singapore

Taiwan

Indonesia

Malaysia

Philippines

Thailand

Vietnam

Bangladesh

Life Expectancy2004, PSY

55

57

59

61

63

65

67

69

71

Infant Mortality Rateper 1,000 deliveries; 2000, PSY

0 10 20 30 40 50 60

China

Hong Kong

Korea

Singapore

Taiwan

Indonesia

Malaysia

Philippines

Thailand

Vietnam

Bangladesh

Infant Mortality Rate per 1,000 deliveries; 2000, PSY

05

1015

2025

3035

4045

Philippin

es

NCRCAR I II II

IIV

AIV

B V VIVII

VIII IX X XIXII

CARAGA

ARMM

Infant Mortality Rate per 1,000 deliveries; 2000, PSY

0

5

10

15

20

25

30

35

40

45

Quintile

LowestSecondThirdFourthFifth

Infant Mortality Rate per 1,000 deliveries; 2000, PSY

0

5

10

15

20

25

30

35

40

Location

UrbanRural

Maternal Mortality Rateper 100,000 live births; 1996-2000, PSY

0 100 200 300 400 500

China

Hong Kong

Korea

Singapore

Taiwan

Indonesia

Malaysia

Philippines

Thailand

Vietnam

Bangladesh

Maternal Mortality Rateper 100,000 live births; 1995, PSY

100

150

200

250

300

350

Philippines

NCRCAR I II III IV V VI

VIIVII

IIX X XI

XII

ARMM

Human Development Index Income per capita Health

Life Expectancy Education

Mean Years of Schooling Literacy Rate

Human Development Index UNDP 2004

Country Rank HDI Country Rank HDI

Norway 1 0.956 Philippines 83 0.753

U.S.A. 8 0.939 China 94 0.745

Singapore 25 0.902 Indonesia 111 0.692

Malaysia 59 0.793 Viet Nam 112 0.691

Thailand 76 0.768 Sierra Leone

177 0.273

0.6

0.62

0.64

0.66

0.68

0.7

0.72

0.74

0.76

0.78

1975 1980 1985 1990 1995 2002

Human Development Index UNDP 2004

Human Poverty Index UNDP 2004

Probability at birth of not surviving to age 40.

Adult illiteracy rate. Population without access to an

improved water source. Children underweight for age.

Country Rank HPI Country Rank HPI

Barbados 1 2.5 Philippines 28 15.0

Singapore 6 6.3 Indonesia 35 17.8

Thailand 22 13.1 Viet Nam 41 20.0

China 24 13.2 Burikina Faso

95 65.5

Human Poverty Index UNDP 2004

Alternative questions for measuring poverty How much income do you make? How much income do you have

relative to others? Do you consider yourself poor? Do you have access to basic

needs? What is the quality of life you are

able to lead?

Poverty beyond measurement Poverty as the inability to handle

risks Poverty as powerlessness Poverty as social exclusion

Outline of the Presentation

1. Poverty Measurements2. Causes of Poverty

a. Inequalityb. Inflationc. Weak Human Capitald. Absence of Employment

Opportunitiese. Weak Agricultural Sectorf. Poor Governance

Unequal Asset Distribution: Land Distribution

449 Landowners*

30 Landowners*

50% of land area

50% of land area

*Ratio and proportion, assumes there are only 479 landowners in the country (based on 1991 Census of Agriculture)

Land Distribution

449 Landowners50% of

land area

25% of land area

25% of land area

29 Landowners

1 Landowner*Ratio and proportion, assumes there are only 479 landowners in the country (based on 1991 Census of Agriculture)

Inflation: Rice Prices, 2008

20

25

30

35

40

45

Janu

ary

Febr

uary

Mar

chAp

rilMay

June Ju

ly

Rice Prices perkilo

Measuring Poverty

Leland Joseph R. Dela CruzDevelopment Studies Program

slideshare.net/ldelacruz