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Measuring Poverty: A New Approach
related to them.29 In other words, the assumption is made that family members pool their resources to support consumption and thereby achieve economies of scale. Unrelated individuals, in contrast, are assumed not to share resources with others, even if they live with one or more roommates.
Although some researchers have criticized the assumption that all family members have access to their "fair share" of the family's resources, data limitations make it infeasible at this time to consider defining the unit of analysis for poverty measurement as an individual, so we recommend continuing to use the family as the unit of analysis. We also recommend that the definition of "family" be broadened to include cohabiting couples, as they maintain longer lasting relationships than other roommates and are likely to pool resources. In the case of roommates as such, there are no data on the extent of resource sharing among them. We encourage research on this topic, and more generally on resource sharing among household and family members.
RECOMMENDATION6.2. The official measure of poverty should continue to use families and unrelated individuals as the units of analysis for which thresholds are defined and resources aggregated. The definition of "family" should be broadened for purposes of poverty measurement to include cohabiting couples.
RECOMMENDATION6.3. Appropriate agencies should conduct research on the extent of resource sharing among roommates and other household and family members to determine if the definition of the unit of analysis for the poverty measure should be modified in the future.
Considerable thought has been given in the research literature to the development of poverty statistics that provide more information than the simple head-count ratio (the poverty rate or proportion of people who are poor). Thus, it would be useful to have a statistic that reflects the depth of poverty, by measuring, for example, the average income of the poor. It would also be useful to have a poverty statistic that increases when resources are less equally distributed among the poor.
The simple head-count ratio—although readily understandable—has some drawbacks. For example, if income were taken from some very poor people to move a few less-poor persons out of poverty, the effect would be to reduce the head count, even though the depth of poverty had become worse. Yet statistics that attempt to capture several dimensions of poverty in a single index
Poverty is not defined for unrelated individuals under age 15, as no information is obtained about their income in surveys.