AN ASPECT OF VARIABLE POPULATION POVERTY COMPARISONS: DOES ADDING A RICH PERSON TO A POPULATION REDUCE POVERTY?

Poverty indexes are essential for monitoring poverty, setting targets for poverty reduction, and tracking progress on these goals. This paper suggests that further justification is necessary for using the main poverty indexes in the literature in any of these ways. It does so by arguing that poverty should not decline with the mere addition of a rich person to a population and showing that the standard indexes do not satisfy this axiom. It, then, suggests a way of modifying these indexes to avoid this problem.