Fallacy in poverty reduction comparisons btw States
Example
Bihar has reduced poverty from 65% to 35% in the last 10 years. Kerala has reduced poverty from 8% to 1% in this period. Which State has done better? (assume a standard normal distribution of poverty)
NB. This exercise can be done for all poverty parameters. Ideally, a frequency distribution histogram of the poverty parameter would be available. Here standard normal distribution is assumed.
The area under the curve from right to left represents the level of poverty. Bihar has higher poverty, so both its points are plotted to the left of Kerala. The change in poverty indicators is the difference between the points for the respective States.
From observation, it appears the indicators have moved equally in the 10 years, yet the following will be commented from this analysis:
1. Kerala has virtually eliminated poverty. It has reduced its levels to 1/8th of the starting point. In contrast, Bihar has reduced by just under 1/2.
2. A 30% reduction in Bihar's poverty level is a great achievement. In contrast, Kerala has moved just 7% of its population out of poverty.
A lower poverty State will proportionately reduce poverty more dramatically, and a higher poverty State will drop more in terms of percentage points. Neither measure gives a true picture of the improvement.
4
Shared publicly
- DATA MINING from this article
https://www.livemint.com/Politics/2mYGqXDSb37bediFJmGUvL/Indias-BIMARU-states-developing-but-not-catching-up.html
REPLY 20w - 20w
- Fraction left expresses poverty left as a fraction of the previous poverty level. Eg Kerala has only 8% of the previous poverty. % point represents the arithmetic difference in percentage poverty before and after.
Both give one aspect of poverty reduction. In pure number terms, the arithmetic difference is best. It also impacts all-India statistics the most. In terms of prevalence then it is former. SD method may be the best indicator.
REPLY 20w - Multidimensional poverty in the future: Will India follow the secular decline it has witnessed in last 10 years, or will there be a sharp decline based on Govt actions?
-----------------------------------------------------
1. Analysis so far suggests that low poverty States will comfortably reduce poverty levels to nominal levels in the next 10 years. The rate of decline will be sharper for all states due to population distribution or statistical effects.
2. Will falling birth rates in Gangetic plains (eg Bihar) make an impact on poverty? A positive impact will be seen only if birth control measures are successful in the worst affected states.
3. Centre & States economic policies will also impact poverty levels. Higher infrastructure spending/ reforms/ MII should lead to higher growth.
4. Comprehensive village development & universal access to utilities (eg gas, power, telecom) should reduce deprivation.
5. Central govt efforts in DBT or targeted help to most deprived (eg PM Jan Arogya Yojna, Aspirational districts programme, National Nutrition mission) should lead to better outcomes from govt expenditure. This should lift more people out of poverty and at a faster rate.
6. The article mentions the strong impact of State welfare/ social schemes on poverty alleviation (in states like Kerala, TN & Himachal).
7. With status quo decline in poverty, some states will only reach levels of 7%. Special effort is needed from the following states, to bring levels down to 2.5%, ie. the worst of the others.
Projected poverty levels by 2026 if status quo:
-----------------------------------------------
Bihar 10.78%
Jharkhand 7.23%
Madhya Pradesh 7.12%
Uttar Pradesh 7.05%
Assam 6.70%
Odisha 5.49%
Rajasthan 4.59%
Chhattisgarh 4.58%
Meghalaya 4.58%
Gujarat 3.71%
8. To match East/ SE Asian levels (ie. <1.5 - 2%) then West Bengal, Maharashtra & hilly states (Manipur, Arunachal, Uttarakhand, Nagaland, Tripura) will need to do a little more.REPLY 20w
Add a comment...
No comments:
Post a Comment