some of countries has observed their absolute poverty incidence rate has been decreasing trend, but also increase in relative poverty incidence rate. Why it is happening? is it because of widening of the income inequality? can someone help me to understand this?
Yes. Relative poverty is a measure of inequality in the 50% poorest population.
The following article may be useful for your study,
Examining poverty trends in South Asian countries: where is Sri Lanka among its South Asian counterparts?
As the economy grows, more people enjoy higher income which allows them to exceed minimum requirements for basic living needs. As a result, more people now live above poverty line and absolute poverty rate falls. However, economic growth pushes median income line upward. As the increase of median income is larger than the increase of income of the poor, more people now live below the median income line. Consequently, the relative poverty rate increases.
because absolute poverty uses fixed poverty line ( for example costs of 2200 calories plus allowance for nonfood expenditure, defined in one year and used afterwards adjusted by inflation), while poverty line in relative poverty measurement changes and depends on the welfare distribution in each year (for example, 50% of the median income). It may happen that economic growth benefits all population, but the richest benefit the most. This will decrease absolute poverty, but relative poverty may increase since the median income growth. So, yes, this is indication of higher inequality.
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