In this paper, the concept of vulnerability of the poor’s
welfare and its practical measures are scrutinised in order to derive
implications for targeting poverty reduction policies toward vulnerable
households. As illustration, various measures of vulnerability proposed
in the literature are applied to a panel data-set collected from rural
Pakistan. The empirical results show that different vulnerability
rankings can be obtained depending on the choice of the measure. By
utilising these measures, we can identify who and which region is more
vulnerable to a particular type of risk. This kind of information is
useful in targeting poverty reduction policies. Since the nature of
vulnerability is diverse, it is advisable to use the whole vector of
various vulnerability measures. JEL classification: I32, I38. Keywords:
Vulnerability, Poverty, Risk, Consumption Smoothing,
Pakistan.