Measuring poverty using qualitative perceptions of welfare

The authors show how subjective poverty lines can be derived using simple qualitative assessments of perceived consumption adequacy, based on a household survey. Respondents were asked whether their consumption of food, housing, and clothing was adequate for their family's needs. The author's approach, by identifying the subjective poverty line without the usual"minimum-income question,"offers wide applications in developing country settings. They implement it using survey data for Jamaica and Nepal. The implied subjective poverty lines are robust to alternative methods of dealing with other components of consumption, for which the subjective"adequacy"question was not asked. The aggregate poverty rates based on subjective poverty lines come close to those based on independent"objective"poverty lines. There are notable differences, however, when geographic and demographic poverty profiles are constructed.