Poverty

Poverty is commonly understood as a condition in which individuals or communities lack the financial resources and essential services required to maintain a basic standard of living. It involves more than low income alone; poverty is also associated with limited access to food, safe drinking water, sanitation, shelter, health care, education, and participation in social and political life. Because it affects capabilities, dignity, and security, poverty is central to debates in economics, development studies, public policy, and human rights.

Definitions and Conceptual Approaches

The term poverty derives from Old Norman French povert and Latin paupertas, meaning “poor”. Contemporary definitions vary by institution and context, but they share the idea of deprivation.
The United Nations emphasises poverty as a denial of choices and opportunities, describing it as a violation of human dignity. In this view, poverty means not having enough to feed and clothe a family, lacking access to schools, clinics, land, employment and credit, and living with insecurity, powerlessness and exclusion. It often implies residence in marginal or fragile environments without clean water or adequate sanitation.
The World Bank defines poverty as pronounced deprivation in well-being, noting that it is multidimensional. It includes low income and an inability to acquire basic goods and services needed for survival with dignity, but also low levels of health and education, poor access to water and sanitation, inadequate physical security, lack of voice, and insufficient opportunity to improve one’s life.
The European Union adopts a distinct approach, linking poverty to relative income and social exclusion within each member state. Poverty is measured in relation to the national distribution of income, and people are considered poor if their resources are so limited as to exclude them from the minimum acceptable way of life in the society where they live. This perspective is closely associated with the concept of social cohesion and equality rather than only subsistence.

Absolute Poverty

Absolute poverty (often termed extreme poverty or abject poverty) refers to a fixed standard of minimum needs that is intended to be comparable across countries and over time. It is usually defined as a condition of severe deprivation of basic human needs, including food, safe drinking water, sanitation, health, shelter, education and information. This condition depends not only on income, but also on access to essential services.
In international practice, absolute poverty is frequently measured using an income threshold expressed in Purchasing Power Parity (PPP) dollars. The most widely used indicator has been the international poverty line, which the World Bank periodically updates to reflect changes in prices and consumption patterns. In recent years this line has been set around US$1.90 per person per day (2011 PPP) to represent extreme poverty. Thresholds for moderate poverty are often placed at higher values, such as US$2 or US$3.20 per day, depending on the analytical purpose.
National governments also define their own absolute poverty lines, which reflect local prices, social expectations and policy frameworks. For example, high-income countries may set annual income thresholds for households, while lower-income countries may use levels closer to the cost of a minimum food basket plus essential non-food items. Because these national lines differ significantly, direct comparison of official poverty rates between countries is difficult.
The concept of ultrapoverty has been used for people who fall far below the standard absolute poverty line. One approach defines ultrapoverty as living on very low incomes while spending the overwhelming majority of that income on food and still failing to achieve minimum caloric intake. This highlights situations of extreme nutritional deprivation and vulnerability.

Relative Poverty and Inequality

Relative poverty measures poverty in relation to the standards of living and income distribution prevailing in a particular society at a particular time. A household may be considered poor if its income is substantially below the median income of the society, even if its basic physical needs are met. This approach recognises that poverty is also about participation and inclusion in social, economic and cultural life.
In the European Union and many other regions, relative poverty lines are often set as a percentage of median national income (for example, 50% or 60%). Individuals below this threshold may face barriers to full social participation, such as inadequate housing, limited educational opportunities, restricted access to cultural resources, and social stigma.
Relative poverty is closely related to income inequality, for which one of the most common summary measures is the Gini coefficient. This coefficient ranges from 0 (perfect equality) to 1 (maximum inequality). Higher inequality tends to be associated with higher relative poverty, even when average incomes are high, because the gains from economic growth are unevenly shared.

Global Patterns, Causes and Consequences

On a global scale, a large share of the world’s population lives with limited purchasing power. Many people survive on only a few dollars per day in PPP terms, and a significant proportion of those in extreme poverty live in low-income or conflict-affected countries. Even in middle-income countries experiencing economic growth, the poorest groups often do not receive a fair share of the benefits and thus remain in poverty.
The causes of poverty are complex and interlinked:

• Economic factors such as unemployment, low wages, lack of productive assets, weak markets and volatile prices.
• Social factors including discrimination, inadequate education, poor health, and breakdown of family or community support networks.
• Legal and political factors such as weak institutions, corruption, lack of property rights, conflict, and exclusion from decision-making.
• Environmental factors including land degradation, natural disasters, climate change and unequal access to natural resources.

Certain groups—such as women, children, ethnic minorities, people with disabilities, and rural populations—often experience disproportionate levels of poverty. Processes like the feminisation of poverty highlight how gender inequalities in education, labour markets, unpaid care work and access to property contribute to women’s heightened vulnerability. Child poverty is particularly damaging because it affects nutrition, health, cognitive development and future opportunities.
Poverty also amplifies other social and environmental challenges. Poor communities are generally more exposed to pollution, inadequate infrastructure and unsafe housing, making them more vulnerable to extreme weather events, climate change and environmental injustice. Economic pressures can drive environmentally harmful activities such as deforestation and unsustainable resource extraction, which in turn may trigger further loss of biodiversity and social conflicts over land and resources.

Measurement Debates and Criticisms

The measurement of poverty is the subject of ongoing debate. Critics argue that single income-based poverty lines can be misleading and may underestimate the true scale of deprivation. Some scholars and practitioners propose higher thresholds (for example, US$7.40 or even US$10–15 per day) as more realistic minima for meeting basic needs and achieving normal life expectancy. Under such higher thresholds, the share of the global population considered poor would be significantly larger.
There is also concern that focusing on a single global line, such as US$1.90 per day, can encourage self-congratulatory narratives about progress while obscuring the persistent vulnerability of people living just above that line. Many individuals survive on incomes slightly higher than the extreme poverty threshold, but still face severe constraints in nutrition, health, housing and education.
Beyond income, multidimensional poverty indices have been developed to capture overlapping deprivations in education, health, living standards and other areas. These measures recognise that improvements in one dimension (for example, income) may not immediately translate into better outcomes in others (such as sanitation or schooling), and that policy responses must therefore be comprehensive.

Poverty Alleviation and Global Policy Frameworks

Governments, international organisations and civil society have adopted a wide range of strategies to reduce poverty. Common approaches include expanding access to education and health services, social protection schemes, employment programmes, rural electrification, land reform, microfinance, and urban initiatives such as Housing First for homeless populations. Infrastructure investments, from roads to digital connectivity, are also viewed as vital for linking poor communities to markets, services and opportunities.
At the global level, the United Nations has framed poverty reduction within a broader agenda of sustainable development. In 2015, the Sustainable Development Goals (SDGs) were adopted, with SDG 1 explicitly aiming to end poverty in all its forms everywhere. This goal links poverty alleviation to other objectives, including health, education, gender equality, decent work, reduced inequalities, climate action and peace. International responses to crises such as the COVID-19 pandemic likewise stress that recovery efforts should address poverty, inequality and environmental sustainability together rather than in isolation.