Impacts of Policies on Poverty. Basic Poverty Measures

This module describes two of the most commonly used poverty measures in applied policy works, i.e., the headcount ratio (HR) and the poverty gap (PG) ratio. These are basic poverty indicators used to investigate impacts of public policies on poverty. After providing a conceptual background to HR and PG, this module describes step-by-step procedures and provides numerical examples to calculate these measures. In addition, advantages and shortcomings of these measures are discussed, and their explanatory power is investigated.