Criticism of Poverty Line

The MPCE (Monthly Per Capital Expenditure) Method of calculating the Poverty Line is criticized because of the following reasons:

1. The MPCE method groups all the poor together in one category and does not differentiate them between the very poor and other poor.

2. Other than income and assets, various factors such as accessibility to health care, basic education, etc., are also associated with poverty and are ignored under the MPCE Method.

3. Also, the method only categorises the poor as a group which are to be taken care of by the Government. However, it does not identify the poor who needs the help of the Government, the most.

4. There are certain social factors such as illiteracy, lack of access to resources, discrimination, ill health, or lack of political and civil freedoms that are responsible for poverty. These factors are not considered under the MPCE Method.

Because of these limitations in the estimation of poverty done officially, various scholars have tried to find other ways to determine poverty. For example, Amartya Sen, a noted Nobel Laureate, developed an index; Sen Index. Besides this, there are other tools like Squared Poverty Gap and Poverty Gap Index.

Has the Poverty Level decreased?

According to the government, there has been a decline in the poverty levels of India because of higher economic growth rate, rise in agricultural production, provision of employment in rural areas, and 1991 economic reform. However, the economists argued that while determining poverty line and number of poor, the methods used for the same are manipulated to arrive a reduced figure of the number of poor in India. Also, they believed that the aim of poverty alleviation schemes of the government should be improvement in human lives by reducing different obstacles, such as illiteracy, lack of access to resources, discrimination, ill health, or lack of political and civil freedoms. 

Even though the incidence of poverty has reduced over the years (especially in 80s), the problem of poverty still prevails.

Poverty refers to a state in which an individual is unable to fulfil even the basic necessities of life. The minimum requirements include food, clothing, shelter, education, and health facilities. A nation suffers from a cycle of poverty when a large portion of the population is deprived of even the most basic necessities of life for an extended period. If the minimum needs are not fulfilled, a person has to undergo pain and suffering. Sickness and disabilities render him helpless in all aspects of life. Generation after generation person who lives in poverty grows in poverty and dies in poverty. The population either breeds or multiplies itself.