Poverty Incidence among Minorities

In this chapter, we analyse the incidence of poverty among minorities in India and China. Several measures of poverty incidence are examined: headcount ratios, poverty-gap ratios and consumption per capita by religious minority.1 One of the commonest and simplest measures is the headcount ratio. This measure counts the number of people below a selected poverty line and divides this number by the total population. Assuming that n is the total number of people and m the number below the poverty line z, then the headcount ratio (H) will be: H = m/n $${\text{H = m/n}}$$ or H = F ( z ) $$H = F\left( z \right)$$ Headcount ratio is the simplest measure of poverty incidence but it suffers from limitations. It fails to reflect the intensity of poverty suffered by poor people. For example, the headcount ratio would remain unchanged if a poor Muslim family became poorer. It also fails to indicate how far below the poverty line incomes of poor people have fallen. Furthermore, H can be reduced if some people are made poorer simply by transferring some income from those far below the poverty line to those quite close to it.