Measures of Poverty, Totally Fuzzy and Relative

There is poverty in every region and country of the world, but measuring poverty is a challenging endeavor. Poverty may be considered in relative terms within a country, such as by examining income inequality, or in absolute terms, whether within a country or throughout the world. The United States’ poverty line, for example, is an absolute measure, based on food costs in 1963–1964 and updated for inflation (despite noninflationary changes to food and other household expenses).

The World Bank also uses absolute terms and differentiates between moderate poverty (less than $2 per day) and extreme poverty ($1.25 per day). The European Union and the Organisation for Economic Co-operation and Development (OECD), on the other hand, use relative poverty measures based on comparisons to median household income. ...