Minimum Distribution-Sensitivity, Poverty Aversion, and Poverty Orderings

This paper introduces a measure of distribution-sensitivity, which is similar to Arrow-Pratt's measure of risk aversion, for a poverty index. The measure also gauges poverty aversion and has a clear and straightforward interpretation. Using this measure, we can define various classes of minimum distribution-sensitive poverty indices. We show that the ordering condition for such a class of poverty indices is simply a generalized (poverty) deprivation profile dominance. Properties and implications of this dominance condition are analyzed and poverty orderings by different classes of poverty measures are compared. Journal of Economic Literature Classification Number: I32. 2000 Academic Press