Do Monetary and Non-Monetary Indicators Tell the Same Story About Chronic Poverty?

This paper adopts a direct approach to modeling to investigate whether and how the monetary and non-monetary indicators of chronic poverty are related.

The paper seeks to examine two questions:

• Is the persistence of monetary poverty and non-monetary poverty similar?
• To what extent do different sub-groups of chronic poverty overlap?

The paper uses the following poverty identifiers:

• Monetary poverty: Identified using a three-category scale (non-poor, poor, and food poor) with per capita expenditures as the underlying welfare variable;
• Nutritional poverty: Based on -2 or -3 standard deviations of the US reference population and identified using stunting among children and chronic energy deficiency among adults;
• Educational poverty: Analyzed using the enrollment status of two cohorts of primary and lower secondary school age children.

Statistical tests on the data used in the paper reveal that the distribution of monetary poverty and child stunting, monetary poverty and adult malnutrition and monetary poverty and children's school enrollment are all different.The authors conclude by listing the implications arising from the analysis:

• Despite greater immobility of non-monetary poverty indicators, transitions between different categories of the same are quite high;
• Lack of association between monetary poverty and non-monetary poverty indicators, both in static and dynamic context, will not always lead to greater clarity about the characteristics of the chronically poor.