Counting the World's Poor: Problems and Possible Solutions.

The World Bank prepares and publishes estimates of the number of poor people in the world. While everyone knows that these numbers should be taken with a pinch of salt, the numbers are arguably important. This paper discusses a number of problems with the current $1-a-day poverty counts, makes some suggestions for improvement, and identifies issues that need further research. World poverty numbers are calculated in two stages. At the first, or international stage, a world poverty line is set and used to derive comparable poverty lines for each country. At the second, or domestic stage, the poverty lines are used to count the number of poor people in each country, and the totals added up over countries.