A ground-breaking study on the measurement of poverty

This ground-breaking study on the measurement of poverty shows how policy in this field has taken a wrong turn with disastrous results.

In recent years, poverty has generally been understood in ‘relative’ terms. That is, people are regarded as poor if they earn less than some benchmark relative to average earnings. One perverse result of such relative poverty measures amongst many is that poverty often declines in a serious recession when the better paid lose their jobs. The policy response of income transfers, which are used to address the perceived problem of relative poverty, has often led to serious problems that actually reduce long-term opportunities for poorer people.

The author proposes an entirely new way of measuring poverty. If this measure were applied, public policy would orientate itself towards creating the conditions that allowed the poor to become better off. Such a strategy would focus not only on ensuring economic growth and more labour market participation, but also on supply-side reforms that would reduce the cost of living for the poor.

This monograph is essential reading for all involved in the poverty debate. Its approach to the measurement of poverty and its policy conclusion are original and soundly based on evidence.

2011, Research Monograph 65, ISBN 978 0 255 36638 0, 247pp, PB

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Head of Health and Welfare

Dr Kristian Niemietz joined the IEA in 2008 as Poverty Research Fellow, becoming its Senior Research Fellow in 2013 and Head of Health and Welfare in 2015. Kristian is also a Fellow of the Age Endeavour Fellowship. He studied Economics at the Humboldt Universität zu Berlin and the Universidad de Salamanca, graduating in 2007 as Diplom-Volkswirt (≈MSc in Economics). During his studies, he interned at the Central Bank of Bolivia (2004), the National Statistics Office of Paraguay (2005), and at the IEA (2006). In 2013, he completed a PhD in Political Economy at King’s College London. Kristian previously worked as a Research Fellow at the Berlin-based Institute for Free Enterprise (IUF), and at King's College London, where he taught Economics throughout his postgraduate studies. He is a regular contributor to various journals in the UK, Germany and Switzerland.