Multidimensional Poverty Index (MPI)

The Multidimensional Poverty Index (MPI) is a comprehensive measure that assesses poverty beyond income by evaluating multiple deprivations faced by individuals in their daily lives. It was developed by the Oxford Poverty and Human Development Initiative (OPHI) and the United Nations Development Programme (UNDP).

Key Features of MPI

1. Introduction: Launched in 2010 by OPHI and UNDP.
2. Purpose: To provide a more comprehensive understanding of poverty by examining multiple dimensions of deprivation.
3. Components: The MPI is based on three dimensions, similar to the Human Development Index:
   • Health: Includes nutrition and child mortality.
   • Education: Includes years of schooling and school attendance.
   • Standard of Living: Includes access to electricity, drinking water, sanitation, housing, cooking fuel, and assets.
4. Indicators: A total of 10 indicators are used across the three dimensions to assess deprivations.

Calculation of MPI

1. Deprivation Score: Each indicator is weighted, and individuals receive a deprivation score based on their lack of access or resources.
2. Poverty Threshold: A person is considered multidimensionally poor if their weighted deprivation score is 33% or more.
3. MPI Value: The MPI is calculated as the product of the proportion of people who are poor (poverty incidence) and the average intensity of poverty experienced by the poor.

Advantages of MPI

1. Comprehensive Measure: Examines poverty beyond income by considering multiple dimensions of deprivation.
2. Policy Insights: Helps policymakers identify specific areas where interventions are needed.
3. Regional Comparisons: Provides a clear picture of regional disparities in poverty.
4. Focus on the Most Vulnerable: Highlights those experiencing severe deprivation.
5. Global Comparability: Facilitates comparison of poverty levels across countries.

Limitations of MPI

1. Data Dependence: Relies on the availability and quality of data, which may vary across countries.
2. Static Nature: Does not capture changes in poverty over time effectively.
3. Exclusion of Income: Does not directly include income or wealth as an indicator.
4. Aggregation Issues: Combining indicators into a single index may oversimplify complex realities.
5. Neglect of Inequality: Fails to account for inequality within households or communities.

MPI and India

1. India has made significant progress in reducing multidimensional poverty, with millions lifted out of poverty in recent years.
2. Key areas of deprivation in India include nutrition, sanitation, and education.
3. Programs like Swachh Bharat Abhiyan and Ayushman Bharat aim to address MPI dimensions.
4. India’s MPI performance varies significantly across states, with some regions showing higher levels of deprivation.

Key Points

1. The Multidimensional Poverty Index (MPI) was introduced in 2010 by OPHI and UNDP.
2. It evaluates poverty across three dimensions: health, education, and standard of living.
3. There are 10 indicators used in the calculation of MPI.
4. A deprivation score of 33% or more classifies an individual as multidimensionally poor.
5. Nutrition and child mortality represent the health dimension.
6. Years of schooling and school attendance represent the education dimension.
7. Access to electricity, sanitation, and drinking water are part of the standard of living dimension.
8. The MPI is the product of poverty incidence and poverty intensity.
9. India has implemented schemes to reduce poverty in MPI dimensions, such as Swachh Bharat Abhiyan.
10. MPI complements income-based measures like GDP and GNI.