What is Poverty Gap?

Poverty should be viewed from different angles so that we can get the real depth of the problem. The percentage of people living below the poverty line doesn’t give us a complete picture. More than that, how short are the people from getting the minimum required consumption levels (poverty line) tells us the depth of poverty faced by the population.

This measure about on an average how far the people are short from the poverty line is measured by poverty gap.

According to the World Bank, poverty gap is the mean shortfall from the poverty line (counting the non-poor as having zero shortfall), expressed as a percentage of the poverty line. Poverty gap measures the intensity of poverty. It shows the extent to which individuals on average fall below the poverty line.

The concept of poverty gap was developed by the World Bank and is extensively used to measure the incidence of poverty in different countries.

As per the World Bank, India’s poverty gap was 4.8 per cent in 2011. Most of the Sub Saharan African countries and Least Developed Countries have severe poverty gap ratios. Among developing countries that have growth prospects, India has a comparatively higher poverty gap ratio. But the gap is declining as per the World Bank.

Table: Poverty Gap for leading developing countries in 2011

Source: World Bank

Higher poverty gap shows deep level of deprivation and higher incidence of poverty for those who are under the poverty line. In effect, the government has to transfer more income to bring them above the poverty line. 

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