Basic Concepts of Poverty and Social Risk Management

Basic Concepts of Poverty and Social Risk Management 

This appendix defines various social policy concepts used throughout this book and highlights how they differ from one another or where they sometimes overlap. This information is presented for readers who may not be familiar with these terms and to ensure a common understanding among those who are. 

Understanding and measuring poverty and vulnerability to poverty are crucial for designing effective poverty alleviation policies and programs. Here is an attempt to briefly illustrate the multiple dimensions of poverty and the methods often used to define and measure poverty and vulnerability to poverty. 

The measurement and analysis of poverty requires some measure of welfare. Ideally, such a measure would capture the multidimensional aspects of poverty and be observable and measurable in a consistent way across households, space, and time. One-dimensional welfare measures, whether monetary or nonmonetary, are more common. Monetary indicators of poverty and living conditions include income, consumption, and assets. Nonmonetary indicators include malnutrition access to health, education, and basic services and perceptions of poverty or deprivation. Since no single measure fully captures all such features, living conditions should be monitored over time using a battery of indicators rather than a single measure. Two composite indicators that attempt to capture the mul- 

FOR PROTECTION AND PROMOTION mE DESIGN AND IMPLEMENTATION OF EFFECTIVE SAFETY NETS 

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APPENDIX A. BASIC CONCEPTS OF POVERTY AND SOCIAL RISK MANAGEMENT... 

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