1.

Demographic Features
Larger families tend to fall under the poverty line. They are poorer, due to larger dependent

members. The burden of poverty falls dis-proportionately on the young, with lower levels of education
and nutrition, important factors of productivity later in working life thus leading to chronic poverty.
However, larger families also have significant economies of scale. Also, children consume less than
adults, so sometimes per capita expenditure measures overstate poverty.
Households led by women without male earners are also found to be poorer (Fishlow study in Brazil
also found in Latin America, Africa, South and East Asia.
2. Rural and Urban Poverty
As reflected in the table below, poverty in rural areas is significantly higher. This is visible in countries
even with advances in agriculture.
Country

Rural
Population
(% of pop)

Rural Poor
(% of poor)

India
Kenya

77
80

79
96

Infant
Mortality
(per 1000
live births)
Rural
105
59

Infant
Mortality
(per 1000
live births)
Urban
57
57

Access to
Safe Water
(% of pop)
Rural

Access to
Safe Water
(% of pop) Urban

50
21

76
610

3. Assets
Poverty is both a cause and consequence of lack of assets.
The bulk of poverty is rural, so poverty is associated with the landless. In India, it is also associated with
owners of small holdings. However, as land holdings increase, poverty decreases.
There are not only low levels of physical capital, but also human capital. Since acquiring human capital
(an education) requires removing oneself from the labour force for a certain time period, the
opportunity cost is too high for the already poor. Illiteracy rates are high, school enrollment beyond
primary levels is low.
4. Nutrition
Poverty lines in many countries are often described as the expenditure needed to obtain a certain
minimum level of food or nutrient basket. Adequate food differs based on the activities the individual
is engaged in, as well as the person's nutritional history. Poverty and under-nutrition are those closely
related.
Undernutrition in
i)
ii)

Children - leads to muscle wastage, stunting, and increased susceptibility to illness. It affects
cognitive skills.
ii) Adults diminishes muscle strength, immunity, and the capacity to do productive work.

However, as average income rises, poverty, as measured by household or per capita consumption,
exhibits less of a correlation with anthropometric measures of under nutrition like stunting, wasting, or
low weight in children.
Although poverty and undernutrition are ordinally related (a poor person is likely to be undernourished)
the relationship between increases in income and increases in nutrition are not unambiguously strong.
Two possible cases are:
a) Increase in income -> Increase in nutrition i)Desire for nutrition It leads to better health, stamina,
and mental capacity. ii)Functional value - Better nutrition increases productivity and earnings.
b) Increase in income -> Decrease in nutrition Higher income broadens a consumer's set of choices. He
might choose food on the grounds of: i)Culinary pleasure Better tasting food rather than more
nutritional food. ii)Social standing Certain food is associated with higher social standing (for example,
more meat) or highly advertised food that is reflective of a desired status in life.
The cases a) and b) generally combine to give an intermediate reaction of nutrition to income.
Elasticities and Nutrition

If nutrition is measured in terms of calorie intake, income has a significant impact on nutrition. This is
measured in terms of elasticities the percentage change in consumption of calories when household
budgets change by one percentage point.
= 1 implies that there is an equivalent percentage change in nutrition when budgets change. This is
unlikely as there is a subsistence level of nutrition below which it cannot fall. If income falls, nutrition is
obtained by other sources relatives, neighbours, and friends to survive. As income rises, individuals
substitute away from these sources. Thus 0.6 < < 0.8 is a reasonable assumption.
In actual observation, lies in the full range between close to zero and one. These contradictory findings
can be explained by the fact that: 1. Poorer households react more strongly to changes in budget by
purchasing more nutrients 2. The change in date across peak and lean agricultural seasons skews
estimates. In slack agricultural seasons, especially with imperfect credit markets, is high.