Poverty Redefined: Why Multidimensionality Matters? - Literature Review

Abstract

This critical review highlights the evolution of poverty measurement from income-based traditional measures to multidimensional ones using extensive literature search. Through comparative analysis, the study identified the limitations of unidimensional measures, such as oversimplification and excluding systemic disparities and how multidimensional measures provide a holistic picture of poverty. Empirical evidence suggests significant divergence between income-based and multidimensional measurements, the latter capturing higher rates of deprivation, specifically 44% versus 23% in Ethiopia. Literatures also indicate gaps in multidimensional measures, that is, insufficiency of proper measuring indicators of education, health and standard of living and exclusive emphasis on newly emerging issues, like social protection, digital disparities, climate risks, and gender disparities, proposing context-specific dimensions and indicators for enhancing the Multidimensional Poverty Index (MPI). By bridging between the theoretical frameworks and realities, the current research reiterates the need for applying multi-dimension frameworks towards developing robust, reliable and contextually appropriate poverty measures to aid anti-poverty programs elsewhere. Policy responses should aim at holistic planned interventions to go hand in hand towards promoting inclusive development.