Indicator 1.1.1 Proportion of the population living below the international poverty line by sex, age, employment status and geographic location (urban/rural)

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The indicator Proportion of population below the international poverty line is defined as the percentage of the population living on less than $1.90 a day at 2011 international prices. The ‘international poverty line’ is currently set at $1.90 a day at 2011 international prices.

Monitoring poverty is important on the global development agenda as well as on the national development agenda of many countries. The World Bank produced its first global poverty estimates for developing countries for World Development Report 1990: Poverty (World Bank 1990) using household survey data for 22 countries (Ravallion, Datt, and van de Walle 1991). Since then there has been considerable expansion in the number of countries that field household income and expenditure surveys. The World Bank’s Development Research Group maintains a database that is updated annually as new survey data become available (and thus may contain more recent data or revisions) and conducts a major reassessment of progress against poverty every year. PovcalNet is an interactive computational tool that allows users to replicate these internationally comparable $1.90 and $3.10 a day global, regional and country-level poverty estimates and to compute poverty measures for custom country groupings and for different poverty lines.

In assessing poverty in a given country, and how best to reduce poverty, one naturally focuses on a poverty line that is considered appropriate for that country. But how do we talk meaningfully about “global poverty?” Poverty lines across countries vary in terms of their purchasing power, and they have a strong economic gradient, such that richer countries tend to adopt higher standards of living in defining poverty. But to consistently measure global absolute poverty in terms of consumption we need to treat two people with the same purchasing power over commodities the same way—both are either poor or not poor—even if they live in different countries. Since World Development Report 1990, the World Bank has aimed to apply a common standard in measuring extreme poverty, anchored to what poverty means in the world’s poorest countries. The welfare of people living in different countries can be measured on a common scale by adjusting for differences in the purchasing power of currencies. The commonly used $1 a day standard, measured in 1985 international prices and adjusted to local currency using PPPs, was chosen for World Development Report 1990 because it was typical of the poverty lines in low-income countries at the time. As differences in the cost of living across the world evolve, the international poverty line has to be periodically updated using new PPP price data to reflect these changes. The last change was in October 2015, when the World Bank adopted $1.90 as the international poverty line using the 2011 PPP. Prior to that, the 2008 update set the international poverty line at $1.25 using the 2005 PPP. Poverty measures based on international poverty lines attempt to hold the real value of the poverty line constant across countries, as is done when making comparisons over time. Early editions of the World Bank’s World Development Indicators (WDI) used PPPs from the Penn World Tables to convert values in local currency to equivalent purchasing power measured in U.S dollars. Later editions used 1993, 2005, and 2011 consumption PPP estimates produced by the World Bank’s International Comparison Program (ICP).

To measure poverty across countries consistently, the World Bank’s international measures apply a common standard, anchored to what “poverty” means in the world’s poorest countries. The original “$1- a-day” line was based on a compilation of national lines for only 22 developing countries, mostly from academic studies in the 1980s (Ravallion, et al., 1991). Within the World Bank, the Global Poverty Working Group (GPWG) is in charge of the collection, validation and estimation of poverty estimates. GPWG archives the datasets obtained from NSOs and then harmonizes them, applying common methodologies. The objective of the GPWG is to ensure that poverty and inequality data generated, curated, and disseminated by the World Bank are up to date, meet high-quality standards, and are well documented and consistent across dissemination channels. Members of GPWG generate and update the estimates for the proportion of population below the international poverty line using raw data typically provided by country governments. The raw data can be unit-record survey data, or grouped data, depending on the agreements with the country governments. The current extreme poverty line is set at $1.90 a day in 2011 PPP terms, which represents the mean of the national poverty lines found in the same poorest 15 countries ranked by per capita consumption. The new poverty line maintains the same standard for extreme poverty - the poverty line typical of the poorest countries in the world - but updates it using the latest information on the cost of living in developing countries. When measuring international poverty of a country, the international poverty line at PPP is converted to local currencies in 2011 price and is then converted to the prices prevailing at the time of the relevant household survey using the best available Consumer Price Index (CPI). (Equivalently, the survey data on household consumption or income for the survey year are expressed in the prices of the ICP base year, and then converted to PPP $’s.) Then the poverty rate is calculated from that survey. All inter-temporal comparisons are real, as assessed using the country-specific CPI. Interpolation/extrapolation methods are used to line up the survey-based estimates with these reference years.

National poverty is a different concept than global poverty. National poverty rate is defined at country-specific poverty lines in local currencies, which are different in real terms across countries and different from the $1.90-a-day international poverty line. Thus, national poverty rates cannot be compared across countries or with the $1.90-a-day poverty rate.

Poverty economists from the World Bank typically engage with NSOs broadly on poverty measurement and analysis as part of technical assistance activities. The raw data are obtained by poverty economists through their contacts in the NSOs, and checked for quality before being submitted for further analysis.

Data Availability (measured in terms of number of countries that have at least 1 data point by region) Data on Kyrgyzstan are published annually.

National and subnational levels

Within the World Bank’s international database, data are harmonized and comparable with other countries. NSC calculates this indicator based on the KR welfare indicator using the $1.9 PPP poverty line.

www.worldbank.org For more information and methodology: http://iresearch.worldbank.org/PovcalNet/home.aspx . Additionally: http://Documentation.worldbank.org/curated/en/2015/10/25114899/global-count-extremepoor-2012-data-issues-methodology-initial-results Summary: http://www.worldbank.org/en/topic/poverty/brief/global-poverty-line-faq Links to background and working papers, articles, etc.: http://iresearch.worldbank.org/PovcalNet/publications.aspx A Measured Approach to Ending Poverty and Boosting Shared Prosperity: Concepts, Data, and the Twin Goals http://www.worldbank.org/en/research/publication/a-measured-approach-to-ending-povertyand-boosting-shared-prosperity

Published in the «Women and Men in the Kyrgyz Republic» Statistical Compendium

KR National SDG Reporting Platform: https://sustainabledevelopment-kyrgyzstan.github.io

Integrated Household Budget and Labour Force Sample Survey (hereinafter IHBLFSS).

Data are obtained through the IHBLFSS questionnaires using a cluster sample built on the latest available Census and up-to-date housing lists. The IHBLFS surveys rely on personal interviews collected using tablet computers (ComputerAssisted Personal Interview, CAPI). Data are collected on a quarterly basis and an indicator is calculated using data for the past year.

National Statistical Committee of the Kyrgyz Republic (Household Statistics Division)

Kerimalieva N.K.

Sdg_nsc@stat.kg

(0312) 32 46 91

www.stat.kg