It is important to note that a country may score better in comparison to. Foster greer thorbecke fgt index a class of measures of the level of absolute poverty. 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. By using the fgt index, a quantitative estimate of the effect of a change in subgroup poverty on total poverty can be obtained. 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. Measuring poverty with the foster, greer and thorbecke. The fostergreerthorbecke fgt index is a generalized poverty measure developed by erik thorbecke, joel greer, and james foster. Examples illustrate the methodology and also present standard tables and graphics. Measuring poverty with the foster, greer and thorbecke indexes based on the gamma distribution and. Erik thorbecke is a renowned development economist who has made major contributions in many fields in the areas of economic and agricultural development, the measurement and analysis of poverty and malnutrition including the seminal foster greer thorbecke poverty index, the social accounting matrix general equilibrium modeling, and. His 1984 econometrica paper, written jointly with joel greer and erik thorbecke, is one of the most highly cited papers on poverty. Chapter 5 the alkire foster counting methodology sabina alkire, james e.
This revised edition includes a range of new entries to keep pace with an. The fostergreerthorbecke fgt index is a generalized poverty. The index has a simple additive structure where aggregate poverty is a. A class of decomposable poverty measures james foster. How can i create a fostergreerthorbecke indices to. Decomposition of the fostergreerthorbecke index of vulnerability to poverty as description of poverty risk. The most commonly used index from the family, fgt2, puts higher weight on the poverty of. The present study provides a retrospective view of the fgt paper and the subsequent literature, as well as. An explanatory analysis of economic and health inequality. 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. Twentyfive years ago, the fgt class of decomposable poverty measures was introduced in foster, greer, and thorbecke econometrica 52. Thorbecke article about thorbecke by the free dictionary.
Calculate the head count measure, the head count ratio, and the poverty gap. The paper was revisited in 2010 by foster, greer, and thornbecke. Thorbecke graduated from the university of leiden in 1820. A multistage random sampling approach was adopted while descriptive analysis and foster greer thorbecke fgt 1984 poverty index were used. How can i measure poverty through fostergreerthorbecke index. The foster greer thorbecke index satisfies the monotonicity axiom i.
Question 5 1 pts the foster greer thorbecke fgt index evaluated at a 2 is equivalent to the poverty gap index pgi true false d question 6 1 pts a regressive transfer from the poor to the rich increases headcount poverty. 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. Fostergreer thorbecke index with defuzzified poverty line. Fgtfinal by et and jef april 25 2010rkreferencechange1. Impacts of policies on poverty generalised poverty gap measures 3 3.
Note that these sensitivities in general depend not only on the poverty measure of interest, but also on the entire distribution of income as summarized by y t p. Tourism contribution to poverty alleviation in kenya. Babcock professor of economics, emeritus, and graduate school professor at cornell university. How can i measure poverty through fostergreerthorbecke. The data on income were interpreted in terms of the foster greer thorbecke fgt indices foster, greer and thorbecke, 2010, which provide a lower bound below zar 502 and upper bound above zar. Discuss the foster greer thorbecke index as a method of measuring poverty. Thorbecke hand it can be shown that p, satisfies subgroup monotonicity, and an even stronger decomposability property. Decomposing the fostergreerthorbecke index of vulnerability to poverty martina celidoni university of padova, italy paper prepared for the iariwoecd conference on economic insecurity paris, france, november 2223, 2011 session 1. Measuring insecurity and vulnerability 2 tuesday, november 22, 2011, 11.
One set of proposed indices was the foster, greer and thorbecke 1984. The fostergreerthorbecke george washington university. Multidimensional poverty measurement encyclopedia of life. Sciences citation index reveals a steadily increasing number of annual. It considers the inequality among the poor and allows one to vary the amount of weight on income levels when calculating poverty in. Thorbecke, methodology for measuring food poverty generally accepted theoretical requirements while able to meet the needs of planners and. About the book multidimensional poverty measurement. According to the mexican national commission of indigenous peoples development, an indigenous person is defined as someone living in a household whose head of the family, a spouse andor an ascendant selfidentifies and speaker of an indigenous language. In contrast to the sen measure, which adopts a rank order weighting scheme, p. Stata module to calculate and decompose fostergreerthorbecke. 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 according to a socioeconomic status. This command combines two of the most widely used measures in the inequality and poverty literatures. A revised version was published as picking the poor. Dividing each one by total sample population n i meandivide sum of g0 by n, then sum of g1 by n and then g2 by n to get head count ratio, poverty gap index, and squared poverty gap index.
Initially, we explored the correlation between indigenous presence at the municipality level. The squared poverty gap index also known as thepoverty severity index, p 2 averages the squares of the poverty gaps relative to the poverty line. Sage reference fostergreerthorbecke index sage knowledge. Impacts of policies on poverty food and agriculture. Sage books the ultimate social sciences digital library. The income gap ratio i z pz, for example, is the average shortfall of the poor. He is a cooriginator of the widely used foster greer thorbecke poverty measure and played a significant role in the development and popularization of social accounting matrix. Chapter 4 poverty measurement methodology south asia.
The indices were introduced in a 1984 paper by economists erik thorbecke, joel greer, and james foster. The paper established the foster greer thornbecke index, which has expanded into a family of poverty metrics. Try also to calculate the foster greer thorbecke measure with alpha2. Erik thorbecke, professor emeritus, cornell university. Anands 3 paper and subsequent 1983 book 4 exemplified the latent demand. It is one of the fostergreerthorbecke fgt class of poverty measures that allow one to vary the amount of weight that one puts on the income or expenditure level of the poorest members in society. We thank hamid tabatabai and james foster who throughout our research project provided very useful suggestions. Calculate the foster greer throbecke fgt index, for. The fostergreerthorbecke indices are a family of poverty metrics. It seeks to make researchers, students and policy makers aware of the multidimensional and complex nature of this social condition.
This, then, is the context in which foster, greer, thorbecke 54 was written. This second edition of this highlysuccessful glossary provides an exhaustive and authoritative guide to over 200 technical terms used in contemporary scholarly research on poverty. Erik thorbecke born february 17, 1929 is a development economist. For any income vector y broken down into subgroup income vectors y. The headcount index is simply the sample average of the variable iy, z, weighted by. The main objectives of the study were to examine the severity of household food insecurity and identify the determinants of household food insecurity in the district. Optimal taxation and public provision for poverty reduction. Generally, we can measure different indices through msexcel. 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. Learn vocabulary, terms, and more with flashcards, games, and other study tools. Poverty index results showed that 68 percent of the rural households were living below the poverty line in the region. Descriptive statistics, binary logit model, and foster greer thorbecke index were used as methods of data analysis. The second 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 a. Based on the result of descriptive statistics and foster greer.
Decomposing the fostergreerthorbecke index of vulnerability to poverty conclusions conclusions risk is di. Kerby, r 2006, foster, greer and thorbecke index, in odekon, m ed. The most widely used index in the development economics literature is the foster greer thorbecke fgt index 1984, which is a multidimensional index combining three classes of measurements. The present study provides a retrospective view of the fgt paper and the subsequent literature, as well as a brief discussion of future directions. In 1825 he became a professor of diplomatic history at the university of ghent, and in 1831 he was appointed. Given that sar household surveys are consumption based, the rest of the book refers to welfare aggregate and consumption aggregate indistinguishably. A methodology for measuring food poverty applied to kenya. Measuring the economic benefits of forests in relation to. An important advantage of the latter twoindices is thatthey account. But it needs to understand the formula of the index fgt index. Nonparametric statistics for the behavioral sciences, mcgraw. In order to measure poverty, the class of poverty measures developed by foster, greer and thorbecke fgt will be employed foster et al.