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Seminar on poverty statistics
Bangkok, 21-23 June 1999
Note on FAO's Work Relating to the Measurement of Poverty
 

I. Introduction

FAO, being an organization dealing with food and agricultural development, is directly interested in poverty statistics. As part of an earlier programme for the development of socio-economic indicators for monitoring and evaluation of agrarian reform and rural development, FAO had issued specific guidelines for countries regarding the measurement of the prevalence of poverty. On the other hand, FAO has been directly involved in the estimation of the prevalence of food inadequacy (undernutrition) which is closely related to the prevalence of poverty. The activities relating to these two subjects are briefly highlighted in this note.

II. The Prevalence of Poverty

The Programme of Action adopted by the World Conference on Agrarian Reform and Rural Development (WCARRD) recommended that countries

"collect on a regular basis data and develop appropriate indicators on a number of specific items pertaining to the progress of agrarian reform and rural development;"

The Programme of Action also recommended that the UN organizations with FAO as the lead agency consider the adoption of specific measures to assist countries in these tasks. In this connection guidelines relating to a number of socio-economic indicators were prepared. Among these indicators there is one that specifically refers to the prevalence of poverty: the "percentage of population in households with per capita income below the poverty line". A detailed description of this indicator including the key methodological considerations as well as the data sources can be found in pages 16-19 of the document "Guidelines on Socio-Economic Indicators for Monitoring and Evaluating Agrarian Reform and Rural Development" FAO (1988).

III. The Prevalence of Food Inadequacy (Undernutrition)

FAO, mainly in connection with its periodic World Food Surveys, prepares estimates of the proportion and number of persons with inadequate food (undernutrition) for the developing countries. This measure involves the comparison of household food consumption (expressed in terms of calories per person/day) with a minimum dietary energy requirement (also expressed in terms of calories per person/day) and the classification of the individuals in the households with per caput calorie consumption levels below the minimum requirement as being in the undernourished category. The proportion is expressed in mathematical terms as follows:

where x refers to household per caput calorie consumption, f(x) to the frequency distribution of x in the population and c is the minimum dietary energy requirement level (cut-off point). The methodology is therefore analogous to that of the prevalence of poverty where x is taken to represent household per caput income/expenditure and c the poverty line.

Thus, for the purpose of estimating the prevalence of food inadequacy (undernutrition) it is necessary to derive a) the frequency distribution of household per caput calorie consumption and b) the cut-off point. The source of basic data for the distribution of per caput calorie consumption is household income/consumption/expenditure surveys collecting data on the quantities of food items purchased or acquired by households. However, for the purpose of deriving the distribution of household per caput calorie consumption, it is necessary to convert the individual quantities of food items corresponding to each of the households sampled into their dietary energy (calorie) equivalents. The cut-off point is on the other hand derived on the basis of energy requirement norms that are adapted to country specific body-weight standards by sex-age groups and then aggregated taking into account the sex-age distribution of the population.

Data on the distribution of household per caput calorie consumption, which are available for a few countries only, usually refer to different time points across countries. On the other hand estimates of the national average per caput calorie consumption, derived through the FAO food balance sheets, are available on annual basis for practically all countries. In view of this, FAO has developed a methodology that combines the food balance sheet estimate of average calorie consumption level with a measure of the inequality in the distribution among households to generate the frequency distribution of household per caput calorie consumption corresponding to common reference periods for the developing countries. This assumes that the distribution of household per caput calorie consumption is log-normal so that it can be determined on the basis of two measures: the mean and the co-efficient of variation. In this connection the food balance sheet average per caput calorie consumption estimate is taken to reflect the mean and the co-efficient of variation is estimated either directly on the basis of the available survey data referring to distribution of household per caput calorie consumption or indirectly on the basis of survey data on the distribution of household per caput income/expenditure.

A brief description of the principal steps involved in the FAO methodology for estimating the proportion and number of persons undernourished is given below.

  1. The distribution of the available food (expressed in terms of calories) among individuals in a country is derived by combining information on the average per caput calorie consumption level (the per caput daily dietary energy supply) and a measure of the inequality in distribution (the coefficient of variation) estimated on the basis of the available household survey data pertaining to food consumption or income/expenditure.
  2. An estimate is made of the minimum energy requirement below which the average individual's consumption can be considered to be inadequate, i.e. the cut-off point for intake inadequacy. This cut-off point is determined by first calculating the minimum energy requirements by sex-age groups (on the basis of the minimum of the range of acceptable body weight for height and light activity for adults and adolescents) and then aggregating the results (using the sex-age composition of the population as weights) to reflect the minimum requirement of the average individual in the population. The methodology of calculating the energy requirements is based on the recommendations of a joint FAO/WHO/UNU Expert Consultation on energy and protein and requirements (FAO/WHO/UNU. 1985. WHO Technical Report Series No. 724. Geneva, WHO).
  3. The proportion of the population with inadequate food (i.e. the undernourished) is estimated by applying the minimum energy requirement as the cut-off point on the distribution of food availability.
  4. The absolute number of persons undernourished is obtained by multiplying the country's estimated total population by the proportion undernourished (mentioned in step c). 

A detailed account of the methodology underlying the calculation of the proportion and number of persons undernourished is given in Appendix 3 of The Sixth World Food Survey (FAO, 1996)


   
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