Yes, it is. Actually, it might be better than using income (as it is more stable). The main concern is that consumption data are harder to collect.

This is the classical work on the topic:

http://www.ophi.org.uk/wp-content/uploads/Sen-1979_Equality-of-What.pdf

Thanks José-Ignacio Antón. I am grateful for your contribution.

...gracias!!!

Per capita consumption expenditure should not be directly used as an indicator of poverty. Rather, it should be used to estimate the poor and the non-poors classifying the household consumption expenditure levels into quintiles. Households having an expenditure level equivalent to the bottom quintile expenditure range can be referred to as poor households.

Thanks for your contribution, Muntasir Murshed

@muntasir murshed, this is interesting and highly commendable.

Thanks.

Actually its not a recommended measure but some researchers do use them as well. The most recommended measurement for poverty is using the GINI or the Theil Index or ising yhe $1 per day measurement. You can read the paper below.

Reexamining financial development and poverty reduction in emerging countries.

Your input Michael Appiah is greatly appreciated but you forgot to attach the paper.

Kindly oblige,

Ngozi

Since this can be skewed in favour of those with higher incomes, it may not be a suitable measure.

Not necessarily, the per capita consumption expenditure is a true indicator of poverty. It just a presentation of the capacity or level of a person to expense for his needs. Based on that capacity we cannot conclude whether an individual is poor or rich.

Human nature is more complex and unpredictable, and way more when it comes to money. A combination of different indicators including per capita expenditure could be an acceptable representation.

I will lean towards your argument Md. Ruhul Amin because poverty is truly a "presentation of the capacity or level of a person to expense for his needs". I agree!

Thanks for your input...God bless you.

Yes, It can be used... For example World Bank has classified countries based on per capital income...

I agree with Md. Ruhul Amin. Poverty is a multidimensional phenomenon that affects all spheres of human life. You can decide to use absolute poverty as proxied by consumption per capital and also, a multidimensional poverty index generated using a PCA for a robustness check. In generating the index, the following variables are important per capital income, life expectancy, rural development, consumption per capita, and literacy rate. For more info on this check Osinubu, T. T. and Olomola, P.A. (2020): Globalization, income inequality, and poverty relationships: Evidence from Mexico, Indonesia, Nigeria, and Turkey. Journal of Economics and Administrative Sciences.

Thanks Tolulope Osinubi for your contribution.

I agree with you.

Please can you send me your paper?

Kind regards,

Here are the papers

Osinubi, T.T. and Olomola, P.A. (2020), "Globalisation, income inequality and poverty relationships: evidence from Mexico, Indonesia, Nigeria and Turkey", Journal of Economic and Administrative Sciences, Vol. ahead-of-print No. ahead-of-print. https://doi.org/10.1108/JEAS-01-2020-0006

Osinubi, T. T. (2020). THE ROLE OF INCOME INEQUALITY IN THE GLOBALISATION-POVERTY NEXUS: EMPIRICAL EVIDENCE FROM MINT COUNTRIES. Ilorin Journal of Economic Policy, Vol.7, No.2: 67-89,

Thanks a lot Folorunsho M Ajide ... I am very grateful!

My pleasure

Thank you @Folorunsho M. Ajide. Check your message @Ngozi Adeleye, the paper has been sent to you.

With due respect,

I hope you are doing well.

First of all, I am grateful to you Bosede Ngozi Adeleye , that you are helping the researchers a lot through your YouTube channel “CrunchEconometrix” and I’m one of those.

As far as your question is concerned, I think per capita consumption expenditure doesn’t properly signify all aspects of poverty. Instead you can use the Multidimensional Poverty Index (MPI) by following the Alkire-Foster (AF) method.

Income poverty definitely provides very useful information. Yet poor people themselves define their poverty much more broadly to include lack of education, health, housing, empowerment, employment, personal security and more. No one indicator, such as income, is uniquely able to capture the multiple aspects that contribute to poverty. For this reason, since 1997, Human Development Reports (HDRs) have measured poverty in ways different than traditional income-based measures. The Human Poverty Index (HPI) was the first such measure, which was replaced by the Multidimensional Poverty Index (MPI) in 2010.

For further detail please find the attachment.

Thanks Aqib Mujtaba I deeply appreciate your encouraging feedback and your contribution towards my query. The beauty of research rests in its diversity to issues. Current studies still use per capita consumption expenditure (PCE) while some lean towards the multidimensional poverty index (MPI) and other poverty measures. Thanks for the article, I will be using it for my revised manuscript.

God bless, you!

...and Tolulope Osinubi I acknowledged the paper you sent. Check your message (smiles).

I do not think so. Employment, slums, service delivery by local governments to the poor, housing, GDP, political will, and many more (I have done some research on it) are also key to poverty

Thanks for your contribution, Hendrik Kleynhans . Please share your research for the benefit of all.

Kind regards.

Poverty is a multidimensional phenomenon. It not only depends on their own income and expenditure but also on the public investment such as development of infrastructure --investment in piped water, sanitation facilities, health facilities. It is important where are they living. Who are using these facilities. How presence/absence of these facilities affect their lives. These facilities are ultimately related to life expectancy, infant mortality rate -- an indicator of capability poverty, child mortality and MMR.

Thanks for your contribution Rizwana Siddiqui ....appreciated!

First of all, poverty should be well defined. It might be unidimensional or it might be multidimensional. Sometimes deprivation may be judged in terms of income/expenditure or it may be judged in terms of multiple aspects. Naturally if one is interested to judge the shortfall in terms of income/expenditure, one can take expenditure as measure of poverty. But my view is poverty should be multidimensional which yield better picture of poverty.

Your view perfectly aligns with several contributors...thanks a lot, Jayanta Sen

...deeply appreciated!

Such questions are non-binary and are contingent on several factors. On the one hand, the Gini coefficient in a country can better illustrate the distance between varying income deciles. In such circumstances, per capita consumption over 5 - 10 years could better illustrate the diffusion of GDP outcomes, without reflecting how many people are below or above the poverty line. However, it should be noted that total consumption could be concentrated in the upper deciles of the income distribution, which are not representative of overall consumption.

1). As a gauge for economic development, per capita consumption should be used in conjunction with income distribution for different deciles.

2). Secondly, the Gini coefficient, the poverty rate, and the number of people living on less than $1.80 and $3.50 could provide a better indication of the suitability of the "consumption per capita measure" as a true reflection of economic progress.

https://data.worldbank.org/indicator/NE.CON.PRVT.PC.KD (check details of WB methodology as this could be instructive).

Thanks, Henri Kouam for your your iapt contribution.

...gracias!

Thanks, Henri Kouam for your apt contribution.

...gracias!

The Dimensions of Sustainable Development are Social, Economic, Technological, and Environmental Sustainability.

Therefore the above MPI should also take into consideration the environmental dimension

Changes (not levels) in real consumption per capita over time are useful indicators of the amount of progress in raising average living standards. But a statistical (mean) average provides no information about how various income groups are progressing relative to that average. Average consumption (or income) says nothing specific about poverty.

Thanks Alan Reynolds for your contribution. I quite agree. Changes (not levels) are better measures.

...grateful!

Thanks for your input Olumide Olaoye

But several high-impact journals have published papers using per capita consumption expenditure as the measure of poverty. See:

1) Garza-Rodriguez, J. (2018). Poverty and Economic Growth in Mexico. Social Sciences, 7(10), 183. doi:10.3390/socsci7100183

2) Ho, S. Y., & Iyke, B. N. (2018). Finance-growth-poverty nexus: a re-assessment of the trickle-down hypothesis in China. Economic Change and Restructuring, 51(3), 221-247.

3) Uddin, Gazi Salah, Muhammad Shahbaz, Mohamed Arouri, and Frédéric Teulon. 2014. Financial development and poverty reduction nexus: A cointegration and causality analysis in Bangladesh. Economic Modelling 36: 405–12. doi:10.1016/J.ECONMOD.2013.09.049.

Kind regards,

I think that the consumption pattern is considered somewhat a measure or an indicator of the pattern of income distribution, and this may give an indication somewhat of the level of poverty or disparity in the distribution of income, if you will

@Olumide Olaoye, given the paucity of data on the poverty measures, do you think the non overlapping techniques could better explain the dynamics in the poverty related analysis than multiple imputation techniques

yes, it is a good measure of poverty

Adeyemi Oluwole thanks for your input, Doc.

...appreciated!

Dear Ngozi ADELEYE,

I work in the budget survey as well as in the labour and income survey in Brazil. Per capita "household" consumption can be constructed based on expenditure and budget surveys and used to measure the standard of living of each family, poverty and inequality. However, a series of steps are necessary to move from spending to consumption. 2 texts can show the necessary steps in the brazilian case and how consumption can be used to analyze poverty, inequality, well-being and vulnerability. The first deals with levels and the second with variations and dynamics.

1) Construction of a Consumption Aggregate Based on Information from POF 2008-2009 and Its Use in the Measurement of Welfare, Poverty, Inequality and Vulnerability of Families.

2) The expansion of consumption and the welfare dynamics of the Brazilian families: a decomposition analysis of poverty and inequality

Sincerely

@Ngozi, In my attempt to contribute to this your question, I end of with convincing evidences from you that even answer your question. Thanks

Hallo dear,

Your question is so interesting and confusing for most younger scientists.

Per capita consumption expenditure is a single but suitable measure of economic poverty. In fact, poverty is an amalgamation of social, economic and political scarcities to satisfy human needs.

Therefore, the level of poverty is also needs to be measured on the basis of social, economic and political indicators.

Hence, using per capita consumption expenditure as as measurement will not strong enough for you analysis and even difficult to get articles of the same methodology.

I therefore advice you to refer any development theory books for enhanced awarenesses and to detect as measurement decay in your study.

Regards,

Per capita consumption expenditure is not a suitable measure of poverty because it does not take into account other factors such as income distribution, access to basic services, and social exclusion.

Degree of government control (centralization), taxes, debt, corruption in the government, crime@@ etc. must also be variables to be considered before making a conclusion.

Poverty is a state or condition in which a person or community lacks the financial resources and essentials for a minimum standard of living.

The Human Poverty Index (HPI) was an indication of the poverty of community in a country, developed by the United Nations to complement the Human Development Index (HDI) and was first reported as part of the Human Deprivation Report in 1997. It was considered to better reflect the extent of deprivation in deprived countries compared to the HDI.

The 2010 Human Development Report calculated the HDI combining three dimensions: • A long and healthy life: Life expectancy at birth • Education index: Mean years of schooling and Expected years of schooling • A decent standard of living: GDP per capita (PPP in $)