THE SENSITIVITY OF INTERNATIONAL POVERTY COMPARISONS

Using data from the Luxembourg Income Study, I study the sensitivity of cross‐national income poverty comparisons to the method in which poverty is measured. Absolute poverty comparisons that keep the purchasing power at the poverty line constant across countries lead to conclusions that differ from relative poverty comparisons in which the real value of the poverty line varies with average income. The absolute poverty ranking of countries also varies as the real value of the poverty line is lowered. Cross‐national differences in household characteristics are largely irrelevant in explaining poverty differences.