Multidimensional Poverty in Paraguay: Trends from 2000 to 2015

To meet Paraguay’s national development goals and the Sustainable Development Goals, policy makers require more information about poverty in the country. We propose a multidimensional poverty index (MPI) for Paraguay constructed using the Alkire–Foster dual-cutoff method for multidimensional poverty identification to complement existing national poverty measures based on income. Indicators, dimensions, weighting schemes, and cutoffs used in the Paraguayan MPI were determined based on national definitions of poverty and national and international development priorities. The MPI is estimated for the years 2000–2015 using national household surveys. From 2000 to 2015, the multidimensional poverty incidence in Paraguay declined by an average annualized rate of 9.2%, from 58% of the population in 2000 to 17% of the population in 2015. In 2015, 7% of the population is estimated to be living in multidimensional poverty, but not income poverty. This population would have remained invisible based on income poverty measures alone. This is the first MPI proposed for Paraguay that reflects the country’s national development priorities. The adoption of the MPI may assist policy makers in targeting previously invisible, vulnerable populations and assessing the impact of public policies on reaching the country’s development goals.