Measurement of Multidimensional Poverty in Egypt

Abstract

Measuring poverty and targeting the poor is still challenging in many developing countries due to the absence of an agreed definition of poverty and the limited availability of data. Poor measurement and mal-targeting in anti-poverty policies makes those policies less effective. Egypt suffers from the problems because only a single dimension of poverty such as income is considered to measure and target poverty, while real poverty is multidimensional. Further, the access to those data is limited. This paper suggests a method of poverty measurement that enables us to consider the multi-dimensionality of poverty and circumvent the inaccessibility of household-level income data. First, we measure Multidimensional Poverty Index (MPI) for Egypt using a publicized dataset to show that the MPI gives a closer estimate of actual poverty. Second, we identify the characteristics of poor households by using the probit model to use the results for better targeting.