Sage reference fostergreerthorbecke index sage knowledge. Fostergreerthorbecke fgt index often called the pa poverty measures is given by n is the number of persons, h is the number of poor persons, and. Multidimensional poverty measurement and analysis chapter 3. The foster greer thorbecke index satisfies the monotonicity axiom i. Figure 1 and the illustration show how the index can be applied to measure noncompliance in chile. Such a threshold is generally known as a poverty line and the welfare aggregate that ranks the population from poorest to richest is usually measured on. This paper derives the pegr for an entire class of additively decomposable poverty measuresincluding the fostergreerthorbecke 1984 and watts 1968 measures.
Dear researchers, it is urgent for me to know the system of measuring poverty through fgt index in. One set of proposed indices was the foster, greer and thorbecke 1984. Which of the following is not an example of financial repression a. When i ran the model for the 40k rows, the file grew to over 1 gb. Thus, maximising the pegr implies a maximum reduction in poverty. How can i measure poverty through fostergreerthorbecke. The foster greer thorbecke indices are a family of poverty metrics. This measure is a member of the fgt foster, greer, thorbecke family of poverty measures. Sage books the ultimate social sciences digital library. My journey through the history of development economics. Decomposition of the fostergreerthorbecke index of vulnerability to poverty as description of poverty risk.
Spatial distribution of rural poverty in the last three quinquennial rounds of nss wp 2003002 3 ii. This method squares the poverty gap for each individualhousehold, and thus puts more emphasis on observations that fall far short of the poverty line rather than those that are closer. Anands 3 paper and subsequent 1983 book 4 exemplified the latent demand. Measuring poverty with the foster, greer and thorbecke indexes. Jun 19, 20 discuss the foster greer thorbecke index as a method of measuring poverty. Measuring poverty with the foster, greer and thorbecke indexes based on the gamma distribution fernandezmorales, antonio. Numerous aggregate poverty measures have been suggested in the literature, but what has gained popularity in applied work is the socalled fostergreerthorbecke fgt class of poverty measures, of which the headcount is the most recognizable, owing to its simplicity. How can i create a fostergreerthorbecke indices to. For example, estimates of a multidimensional poverty. In response to the concerns about the use of the cpi raised in malik et al. The fostergreerthorbecke indices are a family of poverty metrics. Twentyfive years ago, the fgt class of decomposable poverty measures was introduced in foster, greer, and thorbecke econometrica 52. Measuring poverty with the foster, greer and thorbecke indexes based on the gamma. Illustrated masterfully by julian galvan, the childrens book will make you more appreciative of all creatures great and small.
Oct 07, 2019 fostergreerthorbecke fgt index often called the pa poverty measures is given by n is the number of persons, h is the number of poor persons, and. The book is designed to raise issues of ethics and morality, and each chapter presents some questions to get the discussion started. A simple axiomatization of the foster, greer and thorbecke. For example, a number of alternative indexes can be expressed as normalized weighted sums of the poverty gaps of the poor e. Headcount indices and poverty gap measures are discussed first, and then the fostergreerthorbecke poverty measure and the human poverty index are described. Chapter 4 poverty measurement methodology in its most basic form, poverty measurement refers to identifying those individuals or households that live below a predefined threshold of welfare. Stata module to calculate and decompose fostergreer. I wonder why a to z fables with philosophical twists. The fostergreerthorbecke class of poverty measures is used to measure poverty headcounts, poverty gaps, and the severity of poverty foster et al. Robust standard errors for the foster greer thorbecke class of poverty indices, stata technical bulletin, statacorp lp, vol.
The second part gives a synthetic introduction of counting approaches to multidimensional poverty measurement and provides an indepth account of the counting multidimensional poverty measurement methodology developed by alkire and foster, which is a straightforward extension of the wellknown fostergreerthorbecke poverty measures that had. Multidimensional poverty measurement and analysis is evolving rapidly. The foster greer thorbecke fgt index is a generalized poverty measure developed by erik thorbecke, joel greer, and james foster. How can i measure poverty through fostergreerthorbecke index in spss or msexcel. This command combines two of the most widely used measures in the inequality and poverty literatures. This index is one of the measures of the fgt class foster, greer and thorbecke 1984, although it is not used as frequently as the poverty incidence index or head count ratio used by indec, and. To meet this goal, this book proposes a framework for measuring health inequality reflecting moral concerns part 1. Foster, greer and thorbecke class of poverty measures to assess. Decomposing the fostergreerthorbecke index of vulnerability.
A particular counting approach to multidimensional poverty measurement, developed by sabina alkire and james foster, has created considerable interest. Is there a way to format the assumptions tables or the index matches so that the file doesnt grow to be so big. Kerby, r 2006, foster, greer and thorbecke index, in odekon, m ed. The fostergreerthorbecke george washington university. The most widely used poverty indices in the literature belong to the foster greerthorbecke index fgt 12 to measure the incidence, depth and severity of poverty. May 28, 2010 twentyfive years ago, the fgt class of decomposable poverty measures was introduced in foster, greer, and thorbecke econometrica 52. Note that the two types of measures are typically calculated on the same distribution of relative incomes, that is, the same lorenz curve. A method for measuring noncompliance that solves this problem draws on the wellknown fostergreerthorbecke fgt poverty measurement technique to create an index of minimum wage violation. Erik thorbecke, professor emeritus, cornell university. From this point, the foster, greer, and thorbecke fgt class of decomposable poverty measures foster et al. There is a threshold value of wellbeing, and poverty is below this threshold. Thorbecke, jan rudolf article about thorbecke, jan rudolf. An eminent jurist and the leading liberal politician of his day, he was one of the men.
These three poverty metrics are known as the fostergreerthorbecke fgt indexes foster, greer, and thorbecke 1984. The headcount index is simply the sample average of the variable iy, z, weighted by. Chapter 4 poverty measurement methodology south asia. The standard snapshot view is by now relatively straightforward. Interest rate controls on loan and deposit rates, c. Decomposing the fostergreerthorbecke index of vulnerability to poverty conclusions conclusions risk is di. In contrast to the sen measure, which adopts a rank order weighting scheme, p. Discuss the foster greer thorbecke index as a method of measuring poverty. Economic growth and development in ethiopia almas heshmati. Fostergreer thorbecke index with defuzzified poverty line.
The aggregation method builds on the unidimensional axiomatic poverty measures and directly extends the fostergreerthorbecke 1984 class of poverty measures introduced in section 2. A new multiplicative decomposition for the fostergreer. Forced sales of government debt to the banking system, b. Economic development todaro all chapters summary universal. The core argument for editing this book is to provide an uptodate picture of the state and patterns of growth and development in ethiopia. This paper identifies a multiplicative decomposition for the foster greer thorbecke poverty indices as a product of the three components which should be involved in every poverty index. Iza world of labor compliance with labor laws in developing. Headcount indices and poverty gap measures are discussed first, and then the foster greer thorbecke poverty measure and the human poverty index are described. A sample of 360 households 180 cases and 180 controls have been. The most famous and frequently deployed fgt measure is the poverty headcount, which simply states the percentage of the population that lives below the poverty line. The result of her dictationmemoirs of a barnyard chickenis a story worthy of your attentionand your childrens and grandchildrens attention. I am creating a forecast with over 40k rows and many many columns. Anands 3 paper and subsequent 1983 book 4 exemplified the latent demand for a measure consistent with the sen axioms, and yet more broadly applicable than the sen measure.
Measuring poverty with the foster, greer and thorbecke. Erik thorbecke the foster greer thorbecke fgt poverty measures. The spatial distribution of rural poverty in the last three. The main focus of this chapter is the adjusted headcount ratio, which reflects the incidence of poverty and the intensity of poverty, capturing the joint. Misreading the index history is full of examples of people misreading the index some even wanted to use it for racist purposes and argued for eugenics in the usa, where race is a big issue, there was a recent case of the book called the bell curve. The fostergreerthorbecke index satisfies the monotonicity axiom i. Foster and shorrocks 1988a,b show how higher orders of stochastic dominance are linked to poverty dominance for different poverty measures in the fostergreerthorbecke fgt class see box 2.
It considers the inequality among the poor and allows one to vary the amount of weight on income levels when calculating poverty in. How can i measure poverty through foster greer thorbecke index in spss or msexcel. A notable example of the importance of civil society organizations and grassroots movements is the recent revival of interest in poverty and its eradication by the political leaders of industrial countries. Various axioms capture intuitions about aggregation into a single poverty index, and from these are derived families of poverty indices, like that put forward by foster, greer, and thorbecke 1984. The foster, greer and thorbecke fgt index is a poverty measure developed by eric thorbecke and joel greer of cornell university and james foster, a professor of economics at vanderbilt university. This, then, is the context in which foster, greer, thorbecke 54 was written. The most commonly used index from the family, fgt2, puts higher weight on the poverty of. This volume is a collection of selected empirical studies on determinants of economic growth and development in ethiopia. Alcohol consumption and poverty in sri lanka publish your.
The second part gives a synthetic introduction of counting approaches to multidimensional poverty measurement and provides an indepth account of the counting multidimensional poverty measurement methodology developed by alkire and foster, which is a straightforward extension of the wellknown foster greer thorbecke poverty measures that had. Although quite recent, this particular methodology of measuring multidimensional poverty has generated some practical interest. Fgt measure has been used in capturing the number of poor, depth and severity of poverty among alcohol consuming household and non alcohol consuming households. Fgt poverty measure for a given population is defined by. Fgtfinal by et and jef april 25 2010rkreferencechange1. The most widely used poverty indices in the literature belong to the foster greer thorbecke index fgt 12 to measure the incidence, depth and severity of poverty.
Robust standard errors for the fostergreerthorbecke class of poverty indices, stata technical bulletin, statacorp lp, vol. Notably the publication of the multidimensional poverty index mpi estimates in the human development reports of the united nations development programme since 2010, and. The fostergreerthorbecke fgt general poverty measure p. According to the ricardian model, the reason for lower priced services in the ldcs. The framework consists of the following three steps. This paper identifies a multiplicative decomposition for the fostergreerthorbecke poverty indices as a product of the three components which should be involved in every poverty index. The methodology this paper uses the popular foster. Many of the columns use index matches to look up off assumptions tables. Note that the two types of measures are typically calculated on the same distribution of.
Robust standard errors for the fostergreerthorbecke class. The fostergreerthorbecke fgt index is a generalized poverty. It does so by applying the fgt transformation to a variable of interest depvar and by calculating the ci of the transformed variable after ranking the observations. Dear researchers, it is urgent for me to know the system of measuring poverty through fgt index in spss or msexcel. The indices were introduced in a 1984 paper by economists erik thorbecke, joel greer, and james. The income gap ratio i z pz, for example, is the average shortfall of the poor.
A variety of poverty indexes have been proposed that integrate different combinations of the properties suggested for a good index. Ive recently noticed my excel 365 running slow when for example changing the font of a table of. The information on the poor is then combined into an aggregate measure. How can i create a fostergreerthorbecke indices to calculate fgt0, fgt1 and fgt2. Multidimensional poverty measurement and analysis sabina. The text goes on to discuss the relationships between poverty, inequality, and social welfare, beginning with a general discussion of why inequality is such a bad thing. Both the sen and thon indices satisfy all the axioms listed above except the subgroup consistency axiom. The most commonly used index from the family, fgt 2, puts higher weight on the poverty of the poorest individuals, making it a combined measure of poverty and income inequality and a popular choice within development economics. This part gives you two more measures where the third is foster greer thorbecke measure. Sciences citation index reveals a steadily increasing number of annual. The present study provides a retrospective view of the fgt paper and the subsequent literature, as well as a brief discussion of future directions.
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